Does Real Estate Sales Have an Impact on the Economy?
Most of us out there probably do not think that a Real Estate transaction has any impact on the local and national economy. As a matter of fact it has a very large impact on the local economy. A news release from BCREA (British Columbia Real Estate Association) explains the impact real estate has on the GDP and how it creates jobs.
British Columbia Real Estate Association (BCREA) say the economic impact is substantial of Multiple Listing Service® (MLS®) residential sales to the provincial economy in 2007. A typical MLS® residential sale generated nearly $42,000 in economic output, $20,000 in Gross Domestic Product (GDP) and $13,000 in household income. Tax revenues to federal, provincial and municipal governments exceeded $9,800. A typical MLS® residential sale also generated 0.28 full time equivalent jobs (FTE).
BCREA further explains that MLS® residential sales provide a significant contribution to BC economy. Every 100 transactions in 2007 generated nearly $4.2 million in economic output and $2 million in GDP.
While a single home sale has a relatively small impact, the cumulative effect of thousands of transactions is noteworthy,” added Muir. The province recorded 102,892 MLS® residential sales last year, contributing $4.3 billion to economic output and $2 billion to provincial GDP.
Home sales also create employment. For every 100 MLS® residential sales, 28 full-time equivalent (FTE) jobs were generated in 2007. This means 28,800 FTE jobs were needed to service the total number of MLS® residential sales last year.
100 typical MLS® residential transactions added nearly $1.3 million to household income. Total MLS® residential sales in 2007 contributed to more than $1.3 billion in BC household income.
Residential transactions generate significant tax revenue. Every 100 MLS® residential sales in 2007 accounted for nearly $300,000 in federal taxes, $660,000 in provincial taxes and $32,000 in municipal taxes. Total MLS® residential sales in 2007 generated approximately $300 million in federal taxes, $680 million in provincial taxes and $33 million in municipal taxes. In total, MLS® residential transactions contributed more than $1 billion to government coffers. End of Article.
We then ask, what does the government do with the 1 billion in revenue? It would be nice to know.
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Cheers,
Bill
Bill Ethier B.Sc – REALTOR®
Properties in Victoria Professionals- Royal LePage Coast Capital Realty
Bill has been a REALTOR® in Victoria since 2006. Originally from the Vancouver area, Bill moved to Victoria to attend the University of Victoria where he received his Bachelor of Science. Not only does Bill have a wealth of real estate knowledge he is also an active member of the community. He is a member of Triple Shot Cycling Club, Island Road Racers and is the Race Director for the Sooke River 10K.
