Re:Are short-term home sellers screwed?
by faisalkhalid80 on Tuesday January 09, 2018 @08:42AM
(#16106044)
Limited by data here unfortunately. The data source I'm using is Land Registry, which only shows successful deals. Regarding transaction costs, in the UK its around 1.5% for broker fees, plus moving and legal costs. There's also capital gains tax on profits generated on the sale, which is a complex mathematic, and applies if its 'not your first home'. And stamp duty (varies by price) which you pay on purchase.
I understand all of your points, and from what you're saying, with the fee levels you've described, it does sound like the UK is different from Canada.
Also you need to factor in realtor fees on both the original purchase and then subsequent sale (I do not know what they are in the UK, but in Canada they can 3%-7% of the transaction, and this exclude lawyer fees and mortgage discharge fees) which means that you need to get a certain percentage of "gain" in the selling price compared to the purchase price to make any real profit at all. If this was Canada, a good percentage of these so called "profitable sales" would actually be breakeven or slight losses.
Assume realtor fees of 5% on both the original purchase and the sale, this completely wipes out the profit of $168M on the $1.5B of sales. Hmm...
Strange article. It is like the author is not at all knowledgeable at all about how realestate works, or maybe UK is very different than Canada.