Local Politics

Realtors to pump $10M into transfer tax fight

Posted June 11, 2008
Updated June 12, 2008

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— The North Carolina Association of Realtors has committed $10 million to its crusade against a tax on real estate sales.

Last year, state lawmakers gave counties two options to raise revenue to pay for growth-related needs like new schools, wider roads and extended water and sewer lines. One was a quarter-cent local sales tax, and the other was land transfer tax of 0.4 percent of the sale price of homes and land.

Voters in 19 counties overwhelmingly rejected the transfer tax at the polls in November and May – one county turned back the tax twice.

Despite its seeming unlikely to be approved, Realtors want the transfer-tax option taken away from counties, and they are banking a $10 million fund to accomplish that goal.

"It takes resources in order to educate the public about this issue, and the more the public knows about this issue, the less they like it," said Tim Kent, chief executive of the North Carolina Association of Realtors.

A bill that would repeal the tax option passed the Senate Finance Committee on Wednesday afternoon and appeared to be picking up momentum before a vote in the full Senate.

"Although it is a vote of the people, they don't like that hanging over them. Therefore, I think it needs to be repealed," said Sen. David Hoyle, D-Gaston, co-chairman of the Senate Finance Committee.

Armed with "Say No to the Home Tax" stickers, Realtors patrolled the hallways of the Legislative Building on Wednesday, courting lawmakers friendly to their cause.

A similar repeal effort failed in the House, but Realtors said they hope it will be revisited there.

"The craziest thing that you can do is add additional costs to owning a house," said Rep. Dan Blue, D-Wake.

The state association and its local affiliates spent an estimated $1 million in the past year for ads and lobbying efforts to fight the tax.

County advocates complained that Realtor money has already helped kill the tax option 20 times.

"I'm a little bit surprised that they are, in fact, using a nuclear bomb to kill a fly," Rebecca Troutman, government relations director for the North Carolina Association of County Commissioners, said of the $10 million war chest.

Without revenue options, Troutman said, delayed school projects will hurt the same people fighting the transfer tax.

"If these monies aren't in place to do infrastructure, that means you can't have the building boom that we've had in the past," she said.

24 Comments

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  • davidgnews Jun 12, 2008

    This realtor lobby is part of the problem, never the solution.

  • DurhamDude Jun 12, 2008

    If I was a realtor I'd support the spending of the money if it meant more money in my pocket down the road. I work to make money. Business are in business to make money. The goal is to make more money than last year.

  • bs101fly Jun 12, 2008

    just another case of realtors thinking THEY are above everyone else!

    Well, YOU ARE NOT!! Time for REALTORS to suffer some too! Especially since THEY are the ones, along with the elite builders, making money all the money on the rest of OUR misery!!!

    Why don't you tell your clients the TRUTH about the MANDATORY schools and the imploding school system instead of covering it up or FLAT OUT lying about it!!!

  • TheAdmiral Jun 12, 2008

    What gets me is that the Orange County Commissioners said that the people were not educated enough to pass the tax.

    What the county commissioners in all 100 counties don't understand is that they can no longer afford pet projects that waste money and have no return on investment.

    They have long ignored the infrastructure of their own towns and cities and then say that they have to continue to annex in order to keep costs in line.

    Excuse me? But you can not continue to annex, adding costs to your system and maintenance issues, and say that it is to fix your own cities problems.

    That is assenine to believe that people living outside the city limits are the problem. No, living inside the city limits is the problem, and bringing them in ADDS to the problem.

    But then again - the liberals who want a communist and socialist society where the government gives you everything don't see this kind of thing as a problem (though most of your failed socialist and communist are gone.)

  • jbyrd Jun 12, 2008

    "They are obviously making too much money if they can waste $10 million."

    Waste $10 million? Get real, if they are willing to spend $10million you can rest assured they plan to make $50million profit from it.

  • davidgnews Jun 12, 2008

    jbyrd - absolutely, just follow the money !

  • keepitreal Jun 12, 2008

    Just finishing my thought!!!

    You work back from the payment to determine price point.

    I can afford X amount per month. Taxes , insurance and interest rate determine what price range you look in not one time fees paid at closing, especially ones paid by the seller, you don't care about their fees you have to look out for your own interests.

    Bottom line is defeating a transfer tax will be good publicity for realtors but not do them any real good in the long run, but no matter what the marketing machines that they are say--- they are only worried about the next sale.

    Stop listening to ads and do your own math and what is best for you not the realtors.

  • jbyrd Jun 12, 2008

    Makes you wonder how much of that $10million will end up directly into some politicians pockets.

  • OpinionOnEverything Jun 12, 2008

    My grandfather and my dad both told me that a house is the best investment you can make.

    They were wrong.

    From 1980 to 2003, home prices in the US average no more than 5% appreciation. From 2004 to 2006, it was 15%. With that sole exception, returns on the S&P500 index has averaged 10-11% for the same 23-year period.

    A house is your home first; a tax shelter second; a smart investment third. Forget the real estate bubble, max out your 401k, Roth, IRA, or whatever stock-based portfolio you have, then think about investing in real estate from now on. Even buying land is a smarter move than hopping from new house to new house.

  • mep Jun 12, 2008

    Wanna know how realtors are able to spend 10 million to fight this? Because they are already making millions, and they do not want to see their profits fall IF this new tax impacts the home sale business. Our current system of, build them (homes) without a plan in place to allow the areas infrastructure (schools, roads, public services) to keep pace is killing us. In my opinion, the area needs something to slow down the growth, and allow for our infrastructure to catch up.

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