The Illinois Association of REALTORS® and the Mainstreet Organization of REALTORS® oppose a referendum on the April 7 ballot in the village of Midlothian, where residents will decide whether or not to impose a real estate transfer tax on property sales.
If approved, Midlothian will charge sellers $5 for every $1,000 sold. So for example, on a home that sells for $100,000, an additional and new tax of $500 would be owed to the village, along with other taxes and fees. See a list of all April 7 Cook County referenda.
IAR Governmental Affairs Director Tom Joseph says if the referendum is approved, even though the village places the tax on the seller at the time of sale, most REALTORS® know at some point the additional tax may have to be a part of the overall negotiation process since it can create a challenge for first-time buyers.
“This referendum is an extension of Home Rule,” says Joseph. “We oppose it not only because the new tax potentially raises the cost of future transactions but because – together with municipal point-of-sale inspections and the issuance of transfer stamps – it can be used to control the real estate process.”
Approximately 18 years ago, the IAR successfully lobbied for a law to prevent Home Rule communities from creating real estate transfer taxes without voters approving them by referendum, says Joseph. The law also requires Home Rule communities to get voter approval to increase real estate transfer taxes.
When communities throughout Cook County and elsewhere have faced Home Rule authority issues like those being posed in Midlothian, it is our purpose to defeat them, he says.
Want more information on April 7 Home Rule initiatives in Illinois? Want more background on IAR’s position? Check out the March 5 blog, “IAR opposes 4 Home Rule measures in April 7 elections.”