This is a BC HST Price Chart that outlines the new home HST Tax Increase and price difference for new British Columbia and Vancouver homes. The numbers tell the story. The BC HST Price Chart indicates that a typical new home will end up costing anywhere between 2% more (for $100,000 home) to more than 7% more (for $2,000,000 home) in the province come July 1st, 2010. The BC HST Price Chart should be used as a reference guide for any new first time homebuyer looking for the BC HST price difference between the old system and new system.

New Home HST Tax Increase – BC HST Price Difference – Harmonized Sales Tax Numbers Chart
We have received many calls and emails regarding the new British Columbia Harmonized Sales Tax. There is much confusion among the general public as to how the BC HST will affect their purchasers, and ultimately, their decisions to buy big ticket expensive items. In the latest surveys, more than 85% of British Columbians are against the provincial HST tax. In many cases, it is easy for BC residents to calculate the increase in prices due to the harmonized sales tax. Going out to the restaurant or getting a haircut will simply cost an extra 7% as part of the HST tax burden. However, the 12% BC HST on new homes and real estate purchases in British Columbia and Greater Vancouver is harder to understand due to the complexities surrounding partial HST rebates, the GST rebates and other taxes. The new home HST tax increase is substantial and the BC HST price difference between the current 5% GST system and the new 12% HST system are profound. For new homebuyers in BC and Vancouver who are unsure about the new home HST tax increase and the BC Harmonized Sales Tax price difference in real estate, please refer to the below HST Numbers Chart.

Remember that the ‘Other Closing Costs’ are just estimates and for the sake of argument, we have used $2,000 including GST for the current 5% GST system. For the new 12% HST system, we have used $2,140 for the ‘Other Closing Costs’ in the new home HST tax increase pricing chart as the difference between the current and old system is 7%.

Price of Eligible New Home (not incl. GST/HST)	Property Transfer Tax		OLD SYSTEM (5% GST)					NEW SYSTEM (12% HST)						NEW HOME COST INCREASE
			GST (5%)	GST Portion (New Housing Rebate1)	Other Closing Costs (incl. 5% GST)	Total Purchase Price		HST (12%)	GST Portion (New Housing Rebate1)	BC Portion (New Housing Rebate2)	Other Closing Costs (incl. 12% HST)	Total Purchase Price
$100,000	$1,000		$5,000	$1,800	$2,000	$106,200		$12,000	$1,800	$5,000	$2,140	$108,340		$2,140
$150,000	$1,500		$7,500	$2,700	$2,000	$158,300		$18,000	$2,700	$7,500	$2,140	$161,440		$3,140
$200,000	$2,000		$10,000	$3,600	$2,000	$210,400		$24,000	$3,600	$10,000	$2,140	$214,540		$4,140
$250,000	$3,000		$12,500	$4,500	$2,000	$263,000		$30,000	$4,500	$12,500	$2,140	$268,140		$5,140
$300,000	$4,000		$15,000	$5,400	$2,000	$315,600		$36,000	$5,400	$15,000	$2,140	$321,740		$6,140
$350,000	$5,000		$17,500	$6,300	$2,000	$368,200		$42,000	$6,300	$17,500	$2,140	$375,340		$7,140
$400,000	$6,000		$20,000	$3,150	$2,000	$424,850		$48,000	$3,150	$20,000	$2,140	$432,990		$8,140
$450,000	$7,000		$22,500	$0	$2,000	$481,500		$54,000	$0	$22,500	$2,140	$493,140		$9,140
$500,000	$8,000		$25,000	$0	$2,000	$535,000		$60,000	$0	$25,000	$2,140	$550,140		$10,140
$550,000	$9,000		$27,500	$0	$2,000	$588,500		$66,000	$0	$26,250	$2,140	$607,140		$12,390
$600,000	$10,000		$30,000	$0	$2,000	$642,000		$72,000	$0	$26,250	$2,140	$664,140		$15,890
$650,000	$11,000		$32,500	$0	$2,000	$695,500		$78,000	$0	$26,250	$2,140	$721,140		$19,390
$700,000	$12,000		$35,000	$0	$2,000	$749,000		$84,000	$0	$26,250	$2,140	$778,140		$22,890
$750,000	$13,000		$37,500	$0	$2,000	$802,500		$90,000	$0	$26,250	$2,140	$835,140		$26,390
$800,000	$14,000		$40,000	$0	$2,000	$856,000		$96,000	$0	$26,250	$2,140	$892,140		$29,890
$850,000	$15,000		$42,500	$0	$2,000	$909,500		$102,000	$0	$26,250	$2,140	$949,140		$33,390
$900,000	$16,000		$45,000	$0	$2,000	$963,000		$108,000	$0	$26,250	$2,140	$1,006,140		$36,890
$950,000	$17,000		$47,500	$0	$2,000	$1,016,500		$114,000	$0	$26,250	$2,140	$1,063,140		$40,390
$1,000,000	$18,000		$50,000	$0	$2,000	$1,070,000		$120,000	$0	$26,250	$2,140	$1,120,140		$43,890
$1,050,000	$19,000		$52,500	$0	$2,000	$1,123,500		$126,000	$0	$26,250	$2,140	$1,177,140		$47,390
$1,100,000	$20,000		$55,000	$0	$2,000	$1,177,000		$132,000	$0	$26,250	$2,140	$1,234,140		$50,890
$1,150,000	$21,000		$57,500	$0	$2,000	$1,230,500		$138,000	$0	$26,250	$2,140	$1,291,140		$54,390
$1,200,000	$22,000		$60,000	$0	$2,000	$1,284,000		$144,000	$0	$26,250	$2,140	$1,348,140		$57,890
$1,250,000	$23,000		$62,500	$0	$2,000	$1,337,500		$150,000	$0	$26,250	$2,140	$1,405,140		$61,390
$1,300,000	$24,000		$65,000	$0	$2,000	$1,391,000		$156,000	$0	$26,250	$2,140	$1,462,140		$64,890
$1,350,000	$25,000		$67,500	$0	$2,000	$1,444,500		$162,000	$0	$26,250	$2,140	$1,519,140		$68,390
$1,400,000	$26,000		$70,000	$0	$2,000	$1,498,000		$168,000	$0	$26,250	$2,140	$1,576,140		$71,890
$1,450,000	$27,000		$72,500	$0	$2,000	$1,551,500		$174,000	$0	$26,250	$2,140	$1,633,140		$75,390
$1,500,000	$28,000		$75,000	$0	$2,000	$1,605,000		$180,000	$0	$26,250	$2,140	$1,690,140		$78,890
$1,550,000	$29,000		$77,500	$0	$2,000	$1,658,500		$186,000	$0	$26,250	$2,140	$1,747,140		$82,390
$1,600,000	$30,000		$80,000	$0	$2,000	$1,712,000		$192,000	$0	$26,250	$2,140	$1,804,140		$85,890
$1,650,000	$31,000		$82,500	$0	$2,000	$1,765,500		$198,000	$0	$26,250	$2,140	$1,861,140		$89,390
$1,700,000	$32,000		$85,000	$0	$2,000	$1,819,000		$204,000	$0	$26,250	$2,140	$1,918,140		$92,890
$1,750,000	$33,000		$87,500	$0	$2,000	$1,872,500		$210,000	$0	$26,250	$2,140	$1,975,140		$96,390
$1,800,000	$34,000		$90,000	$0	$2,000	$1,926,000		$216,000	$0	$26,250	$2,140	$2,032,140		$99,890
$1,850,000	$35,000		$92,500	$0	$2,000	$1,979,500		$222,000	$0	$26,250	$2,140	$2,089,140		$103,390
$1,900,000	$36,000		$95,000	$0	$2,000	$2,033,000		$228,000	$0	$26,250	$2,140	$2,146,140		$106,890
$1,950,000	$37,000		$97,500	$0	$2,000	$2,086,500		$234,000	$0	$26,250	$2,140	$2,203,140		$110,390
$2,000,000	$38,000		$100,000	$0	$2,000	$2,140,000		$240,000	$0	$26,250	$2,140	$2,260,140		$113,890

¹ In the current 5% GST system, new homebuyers in Vancouver and British Columbia may be eligible for a one-time federal GST Rebate. The rebate is called the GST new housing rebate and can be completed by the homeowner themselves or by their legal team. The GST new housing rebate is equal to 36% (thirty six per cent) of the total 5% GST paid on the first $350,000 (three hundred and fifty thousand dollars) of the purchase price of a new Vancouver or BC home. For new homes between $350,000 to $400,000 (before property transfer taxes, GST and other closing costs), the amount of the federal GST new housing rebate phases until until it reaches zero at $450,000.

² In the new 12% HST system, BC homebuyers of new homes and condos will still receive the same federal GST new housing rebate (as explained above) which is phased out when the purchase price of a new home hits $525,000. However, for new Vancouver and BC home buyers, they get an added HST rebate on the British Columbia portion of the Harmonized Sales Tax of 5% (five per cent). In other words, there is a proposed HST rebate of 5% on the 12% HST tax for homes valued under $525,000 only. For new homes costing more than $525,000, the maximum partical BC HST rebate is $26,250.

What Do The New Home BC HST Tax Increase Mean? How Much Is the BC HST Price Difference on New Homes in Vancouver?
As you run through the numbers in our BC HST Chart, you will see the differences between the Total Purchase Price in the Old System (5% GST) and the New System (12% HST). In the far right most column, we have calculated the New Home Cost Increase. The new home BC HST tax increase is quite profound when you consider that home ownership and real estate markets in British Columbia are among the highest in Canada already. With affordability a key topic for all residents in this province, the new home BC HST tax increase may mean that many more people will be priced out of the property markets, and forced to rent for a lot longer than anticipated. The BC HST price difference is also very significant. When considering some simple numbers such as the purchase price of a $100,000 new condo in BC, the BC HST price difference is $2,140, which is essentially a bit more than 2% more than the old system. When you work your way up to the $500,000 house, the new home BC HST tax increase stands at roughly $15,140, or 3% more, even after the HST rebate. When you’re talking about a $1 million home, the BC HST price difference is a whopping $50,140, which represents a 5% increase in total purchase price of a new home in Vancouver or BC. And the numbers get uglier as the purchase costs go up.

With the BC HST Price Difference, What Major Impact Does That Have on First Time Homebuyers?
Although an increase in purchase price of 2 to 5% may not sound like much, we are still talking about thousands of dollars. As the above BC HST Price Chart outlines, the new home BC HST tax increase is very substantial even for a small condo that costs $300,000. Do you know of many Vancouver first time homebuyers who can pay an extra $6,140 in BC HST on their new home upon closing? Remember that the major banks are unlikely to finance this 12% HST tax burden, which basically means that the first time home buyer will need to cover the BC HST price difference. Coming up with an extra $6,140 is tough enough, but when it comes to this new home BC HST tax increase for first time homebuyers, it is money out of their wallet that does not even increase the value of their home. The implication of the BC HST price difference and extra tax burden is that many first time homebuyer in Vancouver and British Columbia will stay away from the new construction housing market. The costs and the new home BC HST tax increase for first time homebuyers is too high, forcing many purchasers to either wait and rent for a while or to purchase resale Vancouver property instead. The secondary effect of the new BC HST price difference on new homes is that with fewer first time homebuyers driving the new housing market, the construction industry is likely to suffer. BC new housing sales and construction will drop, forcing many people in the industry to move out of the province or to seek alternate employment. For Vancouver first time homebuyers, July 1st, 2010 may be the last cut off date for you to find an affordable new home before the new BC HST tax increase takes effect.