6 Home purchase closing costs

Congratulations, you’ve just finished the mortgage process, removed subjects, and are now preparing for your meeting with the Notary to complete your new purchase. This is a time for celebration, not panic. A good Broker will prepare you for the added costs associated with purchasing a new property, but just in case your not working with me 😉 here is a list of additional costs to account for. They are:

  • Legal Fees
  • Title Insurance
  • Home Fire and Flood Insurance
  • Land Transfer Tax
  • Adjustments
  • GST

Legal Fees. You’re required to pay legal fees. Your lawyer or notary will cost anywhere from $700 – $1,000 to help with your purchase. There are also fees to register your title with the municipalities. Anticipate a bill of around $1,000 – $1,300, after tax.

Title Insurance. A one-time fee of about $150 which protects you against any issues, defects or fraud on your title. Your lawyer or notary helps sets this up for you, and helps you purchase it.

Home and Fire Insurance. Mortgage lenders require a certificate of fire insurance to be in place by the time you take possession of your home. This amount is generally equal to if not more than your mortgage amount or the replacement cost of the home. The cost can vary based on the property size, any extras being insured, and the insurance company and the municipality the property is located in. The cost can vary anywhere from $400 per year for condos to $2,000 for large homes.

Land transfer tax. Land transfer tax, or property transfer tax (PTT) as it’s known as in British Columbia, is a fee that is charged to you by the province. First-time home buyers are exempt from this fee if they purchase a property under $500,000. All home buyers are exempt if they are purchasing a new property under $750,000.

In BC, the PTT is 1% on the first $200,000 of purchase and 2% thereafter. However, if the property being purchased is over $2,000,000, then it is 3% on any value over $2,000,000.

Adjustments. An adjustment is a cost or payment to you the seller gives or receives for prepaying any property tax or condo fees on your behalf. Simply put, if you take possession in the middle of a month and the seller has already paid for the whole month, you have to pay the seller back for what they’re not using.


GST. GST is only paid on new construction purchases. GST is 5% on the purchase price. Keep in mind that there is a partial GST rebate on properties under $450,000.

Be prepared, and let the celebration ensue. You just bought yourself a new home!!!