Ask the Rocca Sisters: The Hidden Costs of Buying a Home
At the Rocca Sisters Team, we frequently get questions from clients and friends about various aspects of the home selling and home buying process. That is why every week we choose a question and answer it right here on our blog! This week we are covering a topic that we get asked about all the time: What are some of the hidden costs of buying a home?
Buying a home is one of the most important decisions one can make. Particularly for new home buyers who have not been through the process before, the additional costs –that is, anything aside from the price of the home — associated with purchasing a property can seem to come of out of nowhere. Luckily, the Rocca Sisters Team has you covered! Below, we will explore some of the “hidden” costs of buying a home.
What are Some of the Hidden Costs of Home Ownership?
- Home Inspection: Depending on the age and condition of the home, a home inspection, while not mandatory, is often a good idea. Costing between $300 – $400, this inspection allows a professional to assess your new home and advise you of any health, safety, or maintenance issues that may arise in the future.
- Lawyer Fees: Your lawyer will charge you a fee for representation, due on closing. Your knowledgeable Rocca Sisters Team member will be able to refer you to a reputable lawyer if you do not have one in mind.
- Moving Expenses: This one seems very self-explanatory, but many people forget to factor it in. Even if you do not have the need to hire movers, things like transferring and installing utilities, cable, or phone are also considered moving expenses.
- Land Transfer Tax (LTT): Land Transfer Tax is paid by everyone who purchases any home, even a condo, and must be paid once the transaction has been closed, to a max of up to 30 days after closing.
- Harmonized Sales Tax (HST): Harmonized Sales Tax (13% in Ontario) is paid only on newly built home. It does not need to be paid on homes that are being resold.
- Deposit/Down Payment: Most homes require a deposit as an insurance to the home buyer that they will not lose the home to another potential buyer. They also assure the home seller that the buyer is serious about purchasing the home. If the home is purchased by the buyer, the deposit is factored into the down payment. In Canada, the minimum down payment is 5% of the purchase price, but in some cases the seller may require a much larger percentage.
Do you have a question you would like to see answered on this blog? Contact us at any time, we’d love to hear from you!