I am a little concerned about the lack of foresight shown by our legislative body here in Washington state. They are currently discussing a service tax (read "sales tax") on real estate commissions. This tax will be in addition to the Real Estate Excise Tax currently charged sellers (currently 1.78% of the sales price in most counties).
My dilemma is our representatives now readily admit that we were heading into a recession before the housing market crashed and didn't realize it because the housing market was carrying the load. Most of the more intelligent legislators recognize that the housing market is crucial to stabilizing the economy both in our state and across the country.
They say they understand the problem yet they want to add one more stumbling block to a home buyer's ability to buy a home by charging a sales tax on the agent's commission. This will prevent many potential home buyers from purchasing a home.
Once again we see legislators willing to step over dollars to pick up pennies - a practice that seems way too common these days.
A Washington REALTORS report stated that for every 1000 homes purchased nearly $126 million in purchases and services were generated as a result. And approximately 900 folks were working as well. There has been a major push to stimulate the first time home buyer and for good reason. Without the first time home buyer there are fewer move-up home buyers.
It would be my hope that our legislators would look at the big picture or at the very least, listen to those few legislators who have a business back ground.
Our local REALTOR Association (Seattle King County REALTORS) is having a forum this Wednesday morning at Meridian Valley Country Club in Kent at 7:30 a.m. Bill Riley, state president for Washington REALTORS will be speaking on this sales tax issue. Contact SKCAR at 425.974.1011 to register.
Bill Hicks, Designated Broker, Keller Williams Realty Federal Way
Administrator, Evergreen Professional Training, Inc.
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