Closing Costs

As a new or first time home buyer, one may think that buying a property can be as simple as buying a car or other durable household items.  When you purchase a car, there can be many options that you can refuse to add except freight, PDI, insurance, government/environmental levies and HST.  However, I believe that thousands of new home buyers every year are surprised with their closing costs.  You should expect another 3 - 5% on top of your purchase price, depending on the value, new/resale property, type of property, the time gap between interim occupancy and final closing for new condo project, etc.

Here is a non-exhaustive list for your quick reference that are applicable to most new residential properties in GTA:

• Land Transfer Tax (both new and resale property)
• HST (if buyer is not qualified for a rebate of a new home purchase)
• Development charges (vary from one region to another and size of an unit)
• Park levies
• Section 37 levies 
• Prepaid property taxes 
• Water & Hydro meter connection and installation
• Legal fee
• Tarion Warranty Enrollment (applicable to most new properties)
• Reserve fund contribution to condo corporation
• Property appraisal 
• Home inspection fee (highly recommended for resale properties)
• Fire and/or property insurance
• Title insurance

For new condo, another large expense before final closing is occupany fee.  Buyer needs to pay monthly occupany fee between interim closing and final closing to builder in exchange for occupying an unit before title is being transferred.  The longer the time between the two closings, the more occupany fee you have to pay.  

As a real estate professional, I will provide all relevant information so that your investment will be within your budget.  For instance, you should always request to cap the development charge as the city government does not charge the builder not until the completion of the project.  Without capping the development charge, you may be surprised to pay way more than you thought/expected.