If you are buying a house, there are a lot of additional costs to consider besides your down payment. You have scrimped and saved to get your down payment, but what else is going to come up?
Here are some costs that you will also need to save for, and in many cases, provide proof to your mortgage holder that you have these funds saved.
The biggest cost is the Property Transfer Tax. This is very different than property taxes. The Property Transfer Tax (PTT) is paid when you buy a home and is a percentage amount based on the fair market value of the property (unless you qualify for an exemption). If you purchased the house through a Realtor, the house will generally be considered fair market value, but if you bought the house from your Grandma, and she gave you a smoking deal, you may be required to prove that you paid fair market value and are likely to be audited.
The amount is substantial. As of January 2019, the tax is 1%on the first 200,000.00, 2% on the portion between 200K and 2 Million, 3% on the portion from 2 Million to 3 Million and 5% for any value greater than 3 Million.
As an example, if you purchase a $500,000 house, you will be required to pay $8000. Below is the BC Government tax estimate calculator.
https://forms.gov.bc.ca/taxes/estimate-your-property-transfer-taxes/
IF you have NEVER owned a home anywhere in the world, and purchase a house under 525,000.00 then read the blog on PPT exemptions as you may be eligible for an exemption.
As well, IF you are buying a newly built home that is subject to GST and under 750,000.00 you may be eligible for an exemption (which seems fair as you are paying GST as well).
Legal Fees will likely be around $1500
Title Insurance is required if you are getting a mortgage $200
And an Appraisal if you are getting a mortgage $300
Moving costs - this can range from beer and pizza ($125) up to thousands of dollars when you moving any distance. When getting a quote from a mover ask for an all in price, including fuel surcharge, tax etc. From personal experience, I was quoted $1400 for a move and the final bill came in at just over $2100.
Odds and Sods - You will likely have new connection fees for things like natural gas, electricity, internet, and cable. Other things that you might not have considered are garbage cans, garden hoses, blinds or drapes. I once moved into a house which had no window coverings at all, it felt like the neighbourhood fishbowl. Blinds and drapes can easily cost $100/window so with even ten windows you are out another thousand dollars.
If you require any further clarification on closing costs, please reach out to me and I will be happy to go over what your specific closing costs should look like.