Buying a home in Alberta will never be the same again. During these times of declining Calgary real estate sales, an additional $1,000 expense will be added to the cost of purchasing an average home in Alberta.
According to the Canadian Home Builders’ Association's president for the Calgary region, Wayne Copeland, the increase in fees for land titles and mortgages came as a surprise. He said an additional burden will hit buyers as they cope with still other expenses.
Effective July 1, the flat fee rate for titling will increase from $50 to $75, while an increase from $1 to $6 will take effect on the variable fee portion for every $5,000 in price or home value. Fees for mortgage registration will likewise increase at the same rate.
For a $450,000 mortgage, the cost will increase from $140 to $540. As Copeland said, this cost is not yet included in the home's purchase price, and is therefore an additional cost for the buyer.
The Calgary Real Estate Board's president, Corinne Lyall, said this is the first time that title and mortgage registration fees are increased since 2011. She said anything that would adversely affect Calgary real estate buyers is not something that realtors are excited about. In fact, this would have a sticker shock especially on the first-time homebuyers.
According to the Real Estate Investment Network's senior analyst, Don Campbell, these fee hikes may hit homebuyers, but it won't significantly hurt the the Calgary real estate market. He said many buyers don't actually know about the fees they're paying unless informed by their lawyers on the final adjustments. They may not be apprised at the beginning of the transaction so it wouldn't deter them from buying. But it would definitely hurt them.
According to Alan Tennant, CREB chief executive, the board was not consulted re the fee hikes and right now he's still informing realtors on this fee increases.
Service Alberta's spokesperson, Donna Babchishin, said the ministry is conducting discussions with stakeholders. She said per discussions and consultations last year, the ministers and staff were informed that Alberta's fees were lower compared to other provinces.