The following was submitted to Pittsburgh Post-Gazette on 12/15/17:
Pittsburgh City Council has advanced a 0.5% increase in the real estate transfer tax in order to fund the affordable housing trust fund. The final vote will be taken next week.
While we understand the desire to capitalize the fund we strongly believe there are ways to do so that do not burden City of Pittsburgh residents and developers.
The City of Pittsburgh already has one of highest realty transfer tax rates in the state at 4%. The bill under consideration will increase that to 5%. The next highest rates are in Scranton and Philadelphia at 4.3% and 4.1% respectively.
Individuals wanting to invest in their future and the future of Pittsburgh through homeownership in the first time buyer range will be impacted by this increase. How many people will be prevented from purchasing a home in various Pittsburgh neighborhoods because of the increased closing costs?
From the real estate development community’s perspective an additional strain will be placed upon us with a transfer tax increase as we work hard to bring great live, work and play places to the City. Increasing the transfer tax will endanger the willingness of developers to take the very real risk of developing in the City. This increase in real estate transfer tax will be an impediment to real estate investment activity and ultimately slow economic activity in the City of Pittsburgh.
At the end of the day this is not about affordable housing it is about putting the burden on one industry and jeopardizing the City’s future. There are many alternatives to the transfer tax increase that will provide resources to the trust fund. Let’s consider ways to do so that will allow the development community to meet the needs of the “new” Pittsburgh.
We urge Council to postpone next week’s vote and continue to explore other viable options for funding the trust fund.
David P. Weisberg