Owners of Banff Housing Corporation equity-share properties will now pay a commission fee instead of a flat rate when selling their homes through the registered resale list.
Town council – acting as shareholders of the BHC – has unanimously approved moving from a fixed fee of $2,500 to 0.6 per cent of the full market value of the property being sold.
Officials say the idea to move to a commission fee over a flat rate aims to better cover the cost of services provided by BHC for the sale of equity share properties through the registered resale list.
“I’ve batted this one back and forth, but I am going to support this on the premise of what’s important here is ability to pay,” said Mayor Karen Sorensen at the BHC shareholders meeting, Tuesday (Nov. 13).
“Homes that sell for a little bit more will pay a little bit more and homes that sell for a little bit less will pay a little bit less.”
There have been no fee increases since 2006. The new commission-based fee will come into effect on Jan. 1, 2013.
Many BHC homeowners have spoken against the change, arguing the fee doesn’t reflect the service they get and doesn’t compare to the work a realtor does.
Margarette Moar-Bell said she is disappointed, but did not want to make further comment until fully reviewing council’s decision. “At the end of the day, it’s disappointing,” she said. “Where was the option that it would stay as it is?”
Ladd Snowsell, a BHC board member and a BHC homeowner, did not take part in discussions on the user fees recommendations, but has consistently said fees must be related to the services provided and that there’s no comparison of what a realtor does in terms of service to what the BHC does.
While he said he did not believe it was appropriate to comment on Tuesday’s decision because he is both a homeowner and board member, he did say the process being used by the BHC board for decision making is a huge improvement compared to the process used before a working group was struck.
“These important decisions are being made in a very transparent and accountable fashion and I hope that BHC homeowners and all Banff residents can see the strength of this process,” he said.
Council did consider an alternative option to the commission fee, which included a fixed fee of $3,500 – including inflation added since 2006 – plus an annual inflationary hike.
They chose not to go this route, with some councillors saying they preferred the percentage fee approach over a flat fee because it’s more in line with the practice of the open market with a real estate agent.
“I think it’s a more fair and equitable way,” said Coun. Grant Canning.
A report to council said those who list through BHC gain access to a continuously updated list of interested buyers, the property itself is shown by BHC, and it’s advertised on the Town of Banff website.
As well, the report said BHC administration is the conduit through which potential purchasers are put in touch with the seller of a BHC home.
The document stated the board has also done a great deal of work to separate the services that are being provided to each user group to ensure they are being charged appropriately.
“The resale fee revenues are not being directed to new properties or to projects that would be of town-wide significance,” the report stated.
In addition, council approved an annual increase matching the maximum annual increase permitted to price restricted properties be added to the current resale fee of $2,150.
That means, for example, there will be a two per cent increase effective Jan. 1 2013 for BHC properties that are currently subjected to a price restriction of two per cent.
“In any future developments, there might be a different (price restricted) percentage,” said Leslie Taylor, who was acting as a council representative on the BHC’s board of directors. “This motion ties the annual increase to whatever is in the contract for that property.”
In addition, a rental fee of $250 will be charged beginning in the New Year. This will apply to every request for renewal and the maximum rental approval period is one year.
The owners of BHC homes that contain legal suites can go on renting out their suites as they always have – with no application process or fee involved. However, owners wishing to temporarily live elsewhere, such as for education purposes, and want to rent out their home during their absence, have to apply to the board and the fee would cover that application.
A homeowner of a BHC property has three ways through which they can sell their property; they can sell through the BHC’s registered resale list; they can sell through a real estate agent, or they can sell privately.
