The City of Chicago has passed the increase of the transfer tax buyers pay on a property transfer. The rate has been raised from $7.50 per $1000 purcahsed to $10.50/1000.
This money as you probably know has been approved to pay the budget deficit for the CTA budget woes.
An average Lakeview condo sells for $380K. The buyers transfer tax would have been $2850 paid to the city coffers.
Starting April 1, the tax (sorry "transfer stamps") due from the buyer on that same average condo will be $3990!
The politicians are working on getting a stimulus package to jump start the economy by issuing the petty refunds they've granted, however, our local politicians are actually PENALIZING the buyers and reducing the buyers position to move into this already shaky and slowing market.
It's MIND BOGGLING. Why not spread the transfer tax to the SELLER SIDE. That is usually where the money would be available due to capital gains from appreciation. Makes sense to me. Tax the sellers and raise their petty $1.50/1000. Raising the funds from this side would amount to $4.50/1000. On that same $380K condo the seller would be required to pay $1,750 on that sale up from only paltry $570 which will now be due from the same transaction.
Almost $4000 from the buyer and only $570 from the seller AFTER the close. What's wrong with this stimulus package?
At least the buses will be running as the housing industry continues to slide. Experience tells me the housing industry trumps the transit industry as a stimulation of the local, state and national (not to mention global) economy.
Where are our political leaders with vision?
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