What Are My Closing Costs?
Let’s look below at the main closing’s costs associated with buying your new home:
- Land Transfer Tax
In the province of BC, when ownership transfers title, buyers are faced with a land transfer tax – or better known as property transfer tax
- + 1% on first $200,000
- + 2% on balance up to $2,000,000
- + 3% on the balance over $2,000,000
- + 2% on balance over $3,000,000 **If Residential**
- Appraisal Fees
- Your lender may ask you to order a home appraisal as part of your conditions. This cost varies depending on property value, but appraisals typically range between $300 - $500.
- Legal Fees
- At the final stage of your home buying process, your legal team (lawyer or notary), are responsible for legalizing your transaction, including registering your mortgage & transferring title. This estimated cost is between $1,500 - $2,500.
- Home Inspection
- A home inspection is optional in most circumstance and will cost between $300 - $500.
- Home Insurance
- Most lenders will require proof of home insurance at completion. This cost will vary, but you should budget $50 - $100 per month.
- Costs of Newly Constructed Homes
- On a new construction purchase, you will likely be required to pay a 5% GST tax at completion, on top of your down payment.
- Adjustment Costs
- If the seller has pre-paid property taxes, water bills, or utilities in advance for that year, you’ll need to reimburse them at completion via your legal team’s final adjustments. This can potentially add hundreds to your closing costs. On a positive note, the first few months in your new home will be paid for.
- Title Insurance
- Title insurance can safeguard you against fraud. Fees here range from $150 - $300 & are arranged by your legal team.
- Down Payment
- Your down payment is the accumulation of funds that make the difference between your total purchase price & your total mortgage.
- Minimum Down Payment
- 5% on the first $500,000
- 10% on the next $500,000 up to $1,000,000
- 20% on any purchase over $1,000,000
- Make sure to budget for last minute expenses such as professional movers, locksmiths, cleaning supplies, etc…