Home Buying Costs

It’s best to know your home buying costs before you get started. It helps you financially prepared for the purchase costs. The following are the expenses that can be applied to many home buyers and you can find some of them best suit your case.  

1. Down payment: This is the main cost of the purchase of a property; in some cases, the down payment can be as low as 5% of the purchase price. 

2. Mortgage insurance: The federal government requires high-ratio mortgages (with less than 20% down payment) to be insured against default. The cost ranges between 1.25 to 3.75 per cent of the mortgage amount which is added to the mortgage principal.

3. Appraisal fee: Your mortgage lender may request an appraisal of the property.

4. Deposit: The amount is normally paid after subject removal and becomes part of your down payment.

5. Legal fees: Lawyer or notary fees for closing the real estate transaction. The fees include disbursements and charges for courier, facsimile, Trust administration, State of Title Certificate, Land Title Registration,  etc.

6. Property Transfer Tax: Tax rate: 1% on the first $200,000 and 2% on the remainder of the purchase price. There is a rebate for qualifying first-time buyers of homes not more than $425,000 and a proportional rebate for homes up to $450,000.

7.  Goods and Services Tax (GST): The 5% GST applies to the sale of new residential homes in BC. For newly built homes where 10% or more construction begins before April 1, 2013, but ownership and possession occur on or after April 1, 2013 to April 1, 2015, there'll be 5% GST and 2% transition tax.

8. Prepaid property tax and utilities (water, sewer and garbage):  The buyer will reimburse the seller for any prepaid taxes and utilities. 

9. Fire and liability insurance: Most mortgage lenders require property buyers to carry fire and extended coverage insurance and liability insurance.

10. Home inspection: Fees varies and can range from $400-$700, depending on the size of the home and complexity of inspection. 

11. Moving expenses: Depending on the distance travelled and time consumed.  Moving companies usually charge the fee by hours.

12. Home renovations: painting and flooring etc.

13. Service hook-up fees and deposits 

14. New furniture, light fixtures and window coverings