The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

HOME and property buyers who are can close their transactions prior to January 1 should seek to do so, a leading housing developer urged yesterday, as there would be a “big difference” between closing costs before and after Value-Added Tax (VAT) implementation.

Franon Wilson, president of Arawak Homes, told Tribune Business it would now be more of a challenge for persons to own their own home.

He added that buyers should recognise the increased fees that will ultimately be levied against them once VAT is implemented on January 1, 2015.

“The customer, whoever purchases a home or unit, a duplex or whatever the case may be, they will be paying more,” Mr Wilson said.

“It will be more of a challenge for someone to own their own home. With that said, it really comes down to educating the public. If you have a transaction that could possibly close before January 1, you would want to do that.

“After January 1, you also have to be aware of what the fees will be, so you will know how much more you may have to save.”

Earlier this week, the Ministry of Finance’s financial secretary, John Rolle, gave a VAT presentation to the real estate industry.

Mr Wilson added that the Ministry of Finance was looking to produce a paper on whether to replace Stamp Duty on property transactions with VAT, and ultimately reduce purchase costs in some instances.

“It’s all about the education. We have a customer now who just signed their sales agreement, and so right now we are having a conversation with them to let them know that after January 1 we will have to have a new conversation, and that any part of the home that is not finished, VAT may be applicable,” Mr Wilson told Tribune Business.

“It’s the transition and looking at what will be the final cost. That’s something we all will have to go through. There is a big difference between closing a transaction before December 31 and after January 1.

“If someone can close a transaction before December 31, they would save themselves a couple of dollars. If someone is on the fence or they have a deposit but they haven’t taken the next step, there is reason for them to do it now.”