Closing Costs
So you have found your home, and sorted out your mortgage - what other expenses can you expect ?
PROPERTY TRANSFER TAX
Payable by the buyer - 1% on the first $200,000 and 2% on the balance of the purchase price (first time buyers see note below)
LEGAL FEES
No fixed scale but you should probably budget at least $800-1200 for
conveyancing plus a further $2/300 for registering the mortgage. By all
means check with a couple of lawyers/notaries but don't just go with
the cheapest - make sure he has experience in closing real estate deals.
LAND TITLE OFFICE (land title search/filing fees etc)
Around $ 200-300 (your lawyer will arrange this)
PROPERTY TAXES/UTILITIES/STRATA FEES (if applicable)
If these have already been paid in advance by the Sellers, you will have to reimburse them pro-rata
HOME INSPECTION
Your home is a big investment and it is generally recommended to get a
report from a certified home inspector. The cost varies depending on
the size/age of the house but is probably in the range of $400-500 for
a smaller home up to $600-800.
SURVEY FEE/APPRAISAL
Not always required but for some properties your mortgage company may ask for an up to date survey or an appraisal.
INSURANCE
Not strictly a closing cost but it is a standard mortgage requirement
that the home be adequately insured so you will need to arrange this
prior to closing. "Adequate" does not necessarily mean for the full
value of the home - the largest portion of the value of most homes is
actually in the land so even if the house burns down you still have the
land value. Talk to your lender and your insurance broker for a
realistic compromise figure.
G.S.T.
GST is usually payable only on brand new or completely remodelled
homes. If the purchase price is under $450,000 a rebate of up to 36% of
the GST may be available.
FIRST TIME BUYERS
First time buyers are exempt from the BC Property Transfer Tax, subject to certain conditions:-
-must have resided in BC for the past 12 months
-Maximum purchase price $425,000