When you’re purchasing a home, especially if it’s your first time, it’s easy to get hung up on the face value of the transaction. The down payment is a hurdle that most couples are anticipating, which makes it easy to ignore some of the costs that aren’t as obvious. We thought it would be helpful to list a few of them here for you.
Land Transfer Tax
If you’re purchasing a home, you'll have to pay Land Transfer Tax (or property purchase tax.) In Ontario, 0.5% is charged on the first $55,00, 1% is charged on $55,000 to $250,000, and lastly, 1.5% is charged on $250,000 to $400,000. If you’d like to get an accurate idea of what you’re going to have to pay, you can try this helpful calculator. Remember, if you’re a first-time buyer, you’re eligible for a rebate.
If you're buying a new home, you'll have to pay GST; however, you may qualify for a partial rebate. You can learn more about the eligibility, here.
Utilities, such as electricity and gas, will require a nominal fee during the initial set-up process. You can expect to pay a few hundred dollars.
If you’re going to have a mortgage for your home, your lender will insist that you have enough home insurance to cover total, since the property is their security for the loan. Your lawyer will also need confirmation that insurance has been arranged.
You’ll also want to set aside some money for the general costs of moving and living in your home for the first time? Or month? This includes things like garbage bags, cleaning supplies, groceries, and furnishings like blinds, or appliances. As always, you can refer to our buyer’s guide for helpful tips.