Cost of Buying a Home

Before you make that offer to buy a home check out the cost of buying a home. Other than the actual price you pay for the home there are several smaller amounts and a few not so small like Land Transfer Tax and Legal Costs. Costs like Land Transfer Tax vary according to the Province or State in which you are buying. Check with your real estate agent. The Deposit you make usually when your offer has been accepted becomes part of the purchase price on the day of closing, more commonly known as moving day.These costs of buying a home are referred to as the closing costs when buying a home.


1. Ontario Land Transfer Tax: (payable to the Province of Ontario)

1% of Sale Price minus $275 for a house sale up to $250 000

1.5% of Sale Price minus $1525 for a house sale up to $400 000

2% of Sale Price minus $3525 for house sales over $400 000
New homes priced under $400 000 are exempt from the land transfer tax.
Examples

……Sale Price…………….........….............……Tax

……..$250 000…1% of 250000 - $275…..is…$2225

……..$400 000…1.5% of 400000 - $1525 is….$4475

……..$500 000…2% of 500000 - $3525…is….$6475

Note:The City of Toronto has an additional cost of buying a home in the form of a second Land transfer tax. Check to find out if your city has any additional taxes that are due upon buying a property.

2. HST or GST in Canada is payable on the purchase price if buying a newly built home.

3. A deposit of $5000 to $25 000 or more is paid usually when the offer is accepted. The higher the value of the home the higher the deposit requested.

4. There may be a fee for the mortgage loan application and insurance premium of about $250.

5. Legal Costs: from $800 to $1100 which usually includes Title Insurance. See Title Insurance.

6. Home inspection fee: from $300 to $500 and higher for larger more complex properties and older homes.

7. Water quality and well flow and recovery rates if buying a country property costs about $200 to $400.

8. Appraisal fee for the mortgage about $250 to $400. Negotiate with the lender to cancel or minimize this charge.

9. Down payment is a minimum of 10% of the purchase price. See financing.

10. Possible connection costs for telephone, hydro, gas, cable and other utilities.

11. Estoppel certificate in the case of buying a condominium is usually $100.

12. Home insurance costs depend on the size of the home, location and the type of construction as well as other factors: $800 and up.

13. Moving costs vary depending on the size of the household and the distance to be moved. See Planning a Move.

14. There can be other costs such as for appliances, renovations, decorating,

See also Home Maintenance Costs.

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Buy a Home Guide