Did It Really Cost $2?

Reading Time: 3 minutes

Key Takeaway
A buyer can hide the price paid for a property if they prepay the Land Transfer Tax before closing.

As Realtors, you have a couple of options to see what an owner paid for a property.

You can check the MLS history and see previous sales, or in the event of an 0ff-market sale, you can use GeoWarehouse.

But what about when you come across this?

I'm sure you know that this is not just a "really good deal"...

And there's two (2) explanations:

  1. The last transfer was a title transfer adding or removing someone from title, usually a spouse or a child.
  2. The buyer did not want the purchase price publically available.

Wait you can do that?

That "Last Sale" price on GeoWarehouse is actually referencing data from the Land Registry.

But... the Land Registry does not record the price paid, it records the Land Transfer Tax paid on the date (which is based on the purchase price).

So while the standard practice is to pay the LTT on the date of closing, the alternative is to:

  • Pay the land transfer tax before the closing date and receive a clearance certificate, then
  • On the day of closing, register the property at a nominal value (e.g., $2), since the tax is already paid.

So, if you have a buyer that does not want the price of a property publicly available (for whatever reason) they can choose to prepay the LTT and register for nominal consideration.

Just remember that you'll need enough time before closing to arrange this.

Written by
Zachary Soccio-Marandola
Real Estate Lawyer

Direct: (647) 797-6881
Email: zachary@socciomarandola.com
Website: socciomarandola.com
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