There are many expenses that will be incurred when purchasing and moving into a home.  Awareness and a little bit of early planning will help avoid any unpleasant surprises.

Here is an overview of typical expenses, broken down into two parts:

  1. those incurred before or during the purchase process, and
  2. those incurred once you have purchased the home and are preparing your move or have just moved in.


1. Costs incurred during the purchase process

  • Down Payment – The down payment is part of the home price that does not come from the mortgage loan. It is your savings.
  • Deposit – A deposit is sometimes paid when you make an Offer to Purchase to show that you are a serious buyer.  At the time of closing, this amount will be included as part of your down payment.
  • Appraisal Fee – The bank where you are getting your mortgage may ask for an appraisal of the property you are considering purchasing.   The appraisal will also be a good negotiating tool for you as it provides you with a good indication of the value of the home.  Appraisals should include:  assessment of the home’s features, analysis of recent comparable sales, and notations of any other current market conditions which may affect the value of the home.
  • Home Inspection – In addition to an appraisal and before finalizing your offer to purchase, a thorough home inspection should be done.  A home inspection conducted by a qualified home inspector will detail the structural and mechanical conditions of the home.
  • Mortgage Life Insurance – You may want to consider obtaining insurance that will cover the cost of discharging your mortgage in the event of death.
  • Survey or Certificate of Location Cost – Your mortgage lender may ask for an up-to-date survey or certificate of location.  If the seller has a survey, but it is more than five years old, it will probably need to be updated, especially if there has been a new addition, deck or fence built close to the property line.
  • Land Transfer Tax – Also commonly referred to as Land Registration Fee, Deed Registration Fee, Tariff, Welcome Tax or Property Purchases Tax.  In some provinces and territories, you may have to pay this provincial or municipal charge when you close the sale. The cost is a percentage of the property’s purchase price. This tax is usually a few thousand dollars.  If you would like to plan the exact amount, refer to the web or with your lawyer (or notary) to find out the current rates. (Check out our articles pertaining specifically to land transfers taxes in various provinces.)
  • Water Tests – If the home has a well, you will want to have the quality of the water tested to ensure that the water supply is adequate and the water is drinkable. You can negotiate these costs with the vendor and list them in your Offer to Purchase.
  • Septic Tank – If the house has a septic tank, it should be professionally checked to make sure it is in good working order. You may negotiate the cost with the vendor and list it in your Offer to Purchase.
  • Estoppel Certificate Fee (does not apply in Quebec) – This may also be referred to as a Status Certificate.  It applies if you are buying a condominium, or strata unit and it details the corporation’s financial and legal state.
  • Prepaid Property Taxes and/or Utility Bills – In the event the seller has already paid property tax or other expenses that apply to the time after you close on the sale of the home, you will need to reimburse the seller.
  • Legal Fees – Legal fees and related costs must be paid on closing day. The minimum cost is $500 (plus GST/HST). In addition, your lawyer or notary will charge you direct costs to check on the legal status of the property.
  • Goods and Services Tax (GST) – A GST tax of 5% is only payable on newly constructed homes and is often included in the quoted sales price.  Applicability and rebate information can be found on Canada Revenue Agency’s website.
  • Provincial Sales Tax (PST) ranges from 0-10% and is normally included in the quoted sale price.
  • Harmonized Sales Tax (HST) is a combination of GST and PST and is used in British Columbia, Ontario, and the Atlantic provinces of New Brunswick, Newfoundland and Labrador, and Nova Scotia. HST is applicable on most goods, services and consumer products including new homes.  Applicability and rebate information can be found on Canada Revenue Agency’s website.

2. Costs to be incurred once you have purchased your new home

Depending on your situation, there will be other expenses that you will need to take into account.

  • Interest Adjustments – This covers any interest accrued between the closing date of the purchase and the first regular payment date of the mortgage.
  • Moving Costs – Whether you’ll be hiring a moving company, or renting a truck and asking friends for help, there are likely to be moving expenses.  The amount of the moving costs will depend on the distance of the move and the amount of furniture and goods to be transported. There are a lot of details to consider when planning the move of your physical belongings, to help you with this, take a look at our articles on this topic (see Moving My Goods section).
  • Renovations, Repairs and Maintenance – Are there any repairs and renovations you are planning on doing as soon as you move in?
  • Cleaning – Your new home should be given a thorough cleaning at moving time. Whether you’re buying cleaning supplies and doing it yourself, or hiring someone to clean for you, the costs can really add up.
  • Decorating – You might want to re-paint, replace some light fixtures, refinish the floor, re-carpet, or do any number of other re-decorating tasks.
  • Utility Fees – Service connection fees for telephone, gas, electricity, cable TV, satellite TV, Internet, and so on.  Some may also charge a deposit.
  • Changing the Locks – When you move into your new home you will want to change the exterior door locks for security.
  • Home Appliances and Equipment – This is broad category that can include items such as:  appliances, tools, yard equipment, etc….
  • Property Insurance – Property insurance covers the replacement value of the structure of your home and its contents. It will likely be required by the bank or financial institution from which you obtain a mortgage.

You can use the Expense Tracker tool to help you keep track of your expenses.