At a recent housing affordability fair at the Egyptian Board of REALTORS®, I was discussing a transaction in the home rule community of West Frankfort. “My client was surprised to learn at closing she had to pay a fee of 1 percent of the sale price to the city—which meant $1,200 out of her pocket,” the REALTOR® said.
Surprised by the transfer tax, I began researching the history of the real estate transfer tax. The Village of West Frankfort passed a referendum in 2006 making it a home rule community. In 2008, citing their home rule status, the council passed an ordinance creating a transfer fee on the transfer of leases surrounding the city-owned lake. Illinois Association of REALTORS® (IAR) Legal Counsel found that under state law before they implement a transfer tax, the question must be put on the ballot for referendum for voters to decide.
The Illinois Association of REALTORS® (IAR) sent a letter to the village of West Frankfort asking them to stop imposing the tax on all transfers. We are waiting for a response from city officials on their course of action.
This is a prime example of what keeping your government affairs staff informed of what is going on in your real estate market can do to help save you and your client money and get you to the closing!
Kyle Anderson is IAR’s representative for the Greater Gateway, Southwestern Illinois and Egyptian REALTOR® organizations.