The Nova Scotia government plans to double the deed transfer tax for non-resident homebuyers, a move criticized by the province’s Realtors Association. The increase would raise the tax from five to ten percent, with officials estimating an additional $13 million in revenue. The Association argues that this tax hike would deter out-of-province buyers and hinder investment, particularly in rural areas. Suzanne Gravel, the incoming President of the Nova Scotia Association of Realtors, stated that this tax increase would drive potential buyers away and impact property sales, especially for cottage properties.
Finance Minister John Lohr defended the tax increase by stating that it would give Nova Scotians an advantage in bidding for properties against out-of-province competition, particularly in the midst of affordable housing shortages. However, Donna Harding, a real estate agent in Halifax, refuted this claim. She explained that most out-of-province buyers are interested in seasonal cottage properties, not the typical homes sought by first-time buyers. The tax increase would significantly raise the cost of these properties, making them less accessible for buyers, including Nova Scotians living in other provinces who wish to retire in their home province.
The deed transfer tax applies to all residential properties in Nova Scotia, including residentially zoned vacant land and properties with three dwelling units or less. According to Lars Osberg, an economics professor at Dalhousie University, this tax acts as a wedge between the buyer’s payment and the seller’s earnings. Osberg believes that the tax primarily impacts rural areas and does little to address housing shortages, particularly in urban centers like Halifax. He also criticized the tax for sparing large property owners while burdening middle-class homeowners, stating that it does not affect those who own apartment buildings.
The Nova Scotia Realtors Association is set to voice their objections to the tax increase during a hearing with the legislature’s public bills committee, representing over 2,000 members. The association argues that this tax hike could have negative consequences for the real estate market in the province, discouraging potential buyers and hindering property investment, especially in rural areas. Critics of the tax increase believe that it could lead to reduced property sales, particularly for cottage properties, and that it unfairly burdens buyers while sparing large property owners. As the debate continues, the Nova Scotia government will need to reconsider the implications of doubling the deed transfer tax for non-resident homebuyers.
