House Bill 1340 was pulled from the table after governer Bill Ritter announced that he does not support it. This bill, commonly known as “The Transfer Tax Bill”, would ask the voters to increase the Documentary Fee from one cent to five cents per $100 for residential real property, and doubeling it on commercial property.
The proposal would place a disproportionate burden on home buyers by creating an additional mechanism in which to fund affordable housing. In my opinion, establishing yet another tax on housing is counter-productive to keeping it affordable.
The Colorado Association Of Realtors Website has the following to say about this issue:
Reasons CAR does NOT support this bill-
Real estate transfer taxes disproportionately affect lower income households.
Increases the amount of money needed to purchase a home.
Given the disproportionately high cost of real estate in certain Colorado markets, a statewide real estate transfer tax is of particular concern to local stakeholders as housing affordability varies greatly from region to region.
According to Legislative Council, there are more than 300 providers of affordable housing services in the state that spend more than $700 million annually on affordable housing issues in Colorado. In 2007-08, the Division of Housing alone received $31.3 million in federal funds for this purpose ($17M for low income rental subsidies and $11.1 million for affordable housing development).
This transfer tax is the wrong approach to attempt to raise funds for affordable housing. It is a large-scale issue that requires larger-scale solutions. It demands much more than just a little extra money to make it work. Please don’t take that as me being against affordable housing. It’s actually quite the opposite. I, and Colorado REALTORS® as a whole, are in strong support of affordable housing. CARHOF (Colorado Association of Realtors Housing Opportunity Foundation ) has donated over $5.8 million to affordable housing since it’s inception. Research supports that over $700 million is already being spent towards this issue.
There is a clear call for a needs assessment to be done on a statewide level. There is also a clear need for the local Pagosa leadership to give adequate attention to the visionaries and developers who would enable a functional, smart plan for affordable housing here in our town. Creative knowledgeable planning that draws on the strengths of the willing, and is not afraid to confront the obstacles in our way…that is how we must approach affordable housing.
Adding yet another tax to hoard more un-accounted for funds is not the answer. Keep an eye on HB 1340. If it lives through it’s shelving and raises it’s ugly head again give your voice of support in it’s opposition.