New "flip" tax.

[flippinout]

Apparently, developers feel they haven't been getting theirs. With new home development stalling, developers seem to think that the only way they can increase profitability is to build it into their work. Behold then, the latest financial scheme from the housing industry: a flip tax that gets paid to the developer every time the home gets sold.

And this goes on for every time the house is sold within a 99 year time frame.

Now this is, as you might imagine, controversial. So much so, some states have apparently either limited or banned these "private transfer fees." OK, I should have known you'd want to know which ones: Kansas, Oregon, Florida and Missouri, just plain ban the practice, according to the paper, while Texas and California have some restrictions on it.

But most states do not address the issue of these fees at all, so it is something you the potential home buyer should look for before signing a contract for a new home. That's vital because the fees (which are paid by the seller) are not subject to negotiation. If you end up selling a house one day that has one of these private transfer fee deals attached to it, you either pay a trustee at closing or, sorry, no sale!

This is one new tax that apparently is very well known and knowledge of it isnt given to the buyer when they buy the house so it can come back to bite them if they ever decide to sell.

And this will not be good for "flippers" because if you dont have the money to pay for this when the house is sold then there would be no sale.