Real Estate Transfer Fees? Capital Recovery Fees?

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Real Estate Agent with (512) 786-8300

Real estate transfer fees, capital recovery fees, and re conveyance fees, are terms most consumers have never heard of. These fees are typically imposed on the sale or resale of a home, and were likely originated by a builder or developer to recover costs associated with building. These costs can include streets, sewers, and other infrastructure items.

Real estate transfer fees tend to range from one quarter of one percent of the sales price, to a full one percent of the sales prices. Furthermore, the fee will be charged every time the home changes hands for ninety nine years. More often than not, transfer fees go unnoticed by potential home buyers. Several sellers, are exempt from disclosing the existence of such fees. They tend to be the same sellers exempt from other home disclosure requirements- probate sellers, foreclosures, and bankruptcy to name a few. 

There are several critics of the fees, which include real estate professionals and title companies, who see it as another additional cost to a buyer, that provides no value. The controversy continues as the practice becomes more common and the drumbeat from the critics becomes louder.

So how does a person know there is a transfer fee on a property? The real estate professional and buyer should always review every disclosure document, associated with a home thoroughly. And calculate all home costs and fees before making an offer. 

One of the most recent, and contentious transfer fee controversies, revolves around a proponent of recovery fees, here in Austin, Texas. Forbes has an informative article, which covers the story, and explains the fees in great detail:

http://www.forbes.com/2010/08/24/new-real-estate-fees-personal-finance-reconveyance-fees.html

Posted by

Scott Hayes

Austin Real Estate Agency

Extraordinary Service, For Extraordinary People

Direct: 512-786-8300

www.austinrealestateagency.com

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Melissa McKinney
McKinney Realty Group - Fayetteville, NC
Realtor, www.LivingFayetteville.com

Scott~ very interesting and thanks for the link!

Aug 28, 2010 04:22 PM #1
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Scott Hayes

Realty Austin, Broker Associate
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