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How much does it cost to buy or sell a house?

Posted by Christina Steinmann Lowry on March 23, 2021
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Buying a home is often one of the biggest purchases someone makes. It can take a lot of time saving money for a down payment and deciding what kind of home you want. Saving your down payment isn’t the only money you have to consider saving.


Commission Costs

If you are only buying a home realtor fees are usually paid from the selling side. Essentially, the service of a realtor is free for buyers. If you are selling one home and buying another, you will need to consider the commission cost. Each realtor sets up their fees differently, so speak to a few to determine which route is best for you.

Mortgage Penalty

If you are selling a home and your mortgage term is not up, you may need to pay a penalty to break your mortgage. You also have the option to port your mortgage to the next house you buy. This is something to keep in mind and to speak with your mortgage specialist about when planning to move.


Land transfer Tax

Land Transfer Tax is calculated differently across Canada. In Ontario, there is a different tax amount whether you are buying in Toronto or the surrounding area. I will be focusing on the Ontario Land Transfer Tax, without Toronto. The tax is calculated on the sale price of the home. The government has a formula to figure it out. Based on a house bought for $800,000.00 it is $12,475.00, for the Kitchener-Waterloo area. First time home buyers receive a Land Transfer Tax government rebate of the full amount of the tax up to $4,000.00. Any tax beyond that the buyer would pay the balance of.

Down Payment

For a home buyer a minimum down payment of 5% of the purchase price is needed. If a home buyer has a down payment under 20% they will need to buy mortgage insurance, often known as CMHC. The mortgage insurance would be an extra cost over cost of borrowing from the bank (interest rate). To save up enough down payment for an average single detached home (in today’s market) at $800,000, a buyer would need $40,000.00 or above. This is for the down payment alone, not any of the other fees.

Lawyers Fees

Lawyers fees also need to be taken into consideration when buying and selling a home. The average lawyers fees for a home purchase are $1,400.00 – $1,500.00. This of course will vary depending on the lawyer you use, the area you are from and if you are also selling a house. If selling, you will also need your lawyer to take care of that too.

Moving Costs

If you decide to use movers then that is an extra cost you will need to budget in. The average cost of moving is between $300.00 – $1,500.00. It will fluctuate with the amount of furniture you have to move or the distance between the homes.

These are the main costs for buying and selling a home. Some other fees that may apply to you are: Title Insurance, Registration of Mortgage, Transfer of Deed, Appraisal Fees, Survey Costs, Insurance, and Adjustments Utilities/Taxes/Condo Fees.

Saving up to buy a house is more than just a down payment. You may also want to consider saving some extra for new furniture to fit your new home!

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