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Typical Expenses
Property Transfer Tax When a residence is purchased a Property Transfer Tax (PTT) is applied. The tax is calculated at 1% on the first $200,000 and 2% on the remainder. The First-Time Home Buyers' Program offers an exemption to the PTT if the fair market value of the residence is $425,000 or less. In all regions there is also a proportional exemption for first-time buyers of homes with a fair market value up to $25,000 above the thresholds. This means in the Greater Vancouver area, homes valued up to $450,000 ($425,000 threshold + $25,000 proportional exemption) will be charged a pro-rated PTT. For more information please visit: www.rev.gov.bc.ca/rpt/ptt/ptt.htm Mortgage Default Insurance and Application Fee
If you get a high-ratio mortgage (a mortgage where you pay less than 20% down payment) you will have to buy mortgage default insurance from CMHC, Genworth, AIG or a private company. This insurance premium is usually added to your mortgage. Financing Required
| Premium % of Loan Amount
| Up to and including 80%
| 1.00 | Up to and including 85%
| 1.75 | Up to and including 90%
| 2.00 | Up to and including 95% Traditional Down Payment Flex Down* | 2.75 2.90 | Extended Amortization Surcharges For every 5 years of amortization beyond the 25 year mortgage period | 0.20 |
* Down Payment Requirements – Traditional sources of down payment include: Applicant’s savings, RRSP withdrawal, funds borrowed against proven assets, sweat equity (<50% of min.required equity), land unencumbered, proceeds from sale of another property, non-repayable gift from immediate relative, equity grant (non-repayable grant from federal, provincial or municipal agency). Non-traditional sources of down payment include: Any source that is arm’s length to and not tied to the purchase or sale of the property, such as borrowed funds, gifts, 100% sweat equity, lender cash back incentives. For more information please visit CMHC website. GST
When purchasing a newly constructed home, you must pay 5% GST. However, if your house is less than $450,000 you are eligible for a rebate. There is no GST on resale housing unless there have been substantial renovations to the property. GST will apply to services provided by a consultant such as a REALTOR, lawyer or home inspector. Prepaid Property Taxes, Utility Bills, etc.
You will have to reimburse the sellers for any prepaid property taxes, utilities, security services, etc. Appraisal Fee
Before your lender approves your mortgage, you may be required to have an appraisal done. Your lender may cover this cost, otherwise, it is your responsibility. The appraisal is usually required by the lender to verify that the property-not you, the borrower-qualifies for the requested mortgage amount; also, to validate that there is an existing property.The fee ranges from $150 to $350. Home Inspection Fee
Most REALTORS® recommend that you get a home inspection by a professional home inspector. Costs may vary according to the size or age of the house.The fee ranges from $350 to $500.
Legal fees
Lawyers' fees for closing the sale vary according to the complexity of the deal but they should range from $600 to $1500. They will arrange payment of Disbursements to the Land Titles Office on your behalf. Survey Fee Your lender may require an up-to-date survey of the property. If the seller did not provide you with one, you will have to pay to have one done. The fee ranges from $150 to $350.
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