In addition to the purchase price of your home, home ownership carries a few more expenses. Although a ball park figure, you can expect to spend an additional 3% – 4% of the purchase price on closing costs.
Deposit. The biggest pre-purchase cost that you should allow for is the deposit. The deposit can be due after acceptance or after subject removal. While the amount can vary, 1% to 10% of the purchase price is a good figure to work with. The deposit can make up part if not all of your down-payment.
Home Inspection. Home inspection costs will vary on the size of the home but will typically range from $600 – $750. Having a home inspection as a subject clause is money well spent and can often save you money in the long run as it will pinpoint maintenance areas of the home that need to be addressed, immediately or in the near future, and figured into the final sale price.
Appraisal. While not all lenders will require an appraisal it is prudent to allow for $350 to $500 for such a service.
Down payment. Conventional mortgages can require up to 20% down-payment and depending on qualification as low as 5%. Ensure you ask your Financial Institution or Mortgage Broker what options are available to you.
Property Transfer Tax. In BC buyers are responsible for the Property Transfer Tax or PPT. The current amount for this is 1% on the first $200,000.00 and 2% on the remainder. Under the First Time Home Buyers Program, eligible purchasers can claim an exemption from the PPT on homes up to $525,000.
Legal/Notary fees. To transfer and convey the Title of the property you will require the services of a Lawyer or Notary. These fees can range from $1,000 – $1,800.
House Insurance. Most mortgage lenders will require you to have a home insurance policy in place by your closing date. Insurance policies vary in cost.
GST. Applicable to new home purchases, commercial real estate and newly subdivided lots.
Moving costs. Will vary depending on the distance and amount to be moved. A professional moving company can make your move much easier.
Adjustments for prepaid property tax and Strata fees. Your annual payments due by municipalities for water, sewer, garbage and property taxes will be calculated to a daily value and adjusted accordingly for a credit or debit depending on the date of completion of your home or property and whether the amount due has been paid already.
Repairs and Improvements. These should be taken into consideration for when negotiating a final sale price but are ongoing expenses that should be accounted for.
Utility and Service hook up. Contact the respective utility companies to determine cost if applicable.