Closing Costs

Buying a Home or Investment Property in British Columbia, Canada
(As of  Jan 2009)

As a home purchaser in B.C. you may be responsible for the following costs:

1. CMHC fees (mortgage insurance fees) apply if less that 20% down payment.
   Application fee 3.25% of the mortgage   (premiums/fees subject to change).
   
   If you put down 10% or 15%, insurance fees decrease to 2% and 1.75% respectively.
   *Can roll premium into mortgage. Application fee of $235 or $75 + appraisal at Buyers cost.
   
   
2. Property Transfer Tax * ALL HOMES - (Provincial - CANNOT be rolled into Mortgage).
                        1% on the 1st $200,000
                        2% on the balance.
   
   First time buyer exemption available upon meeting the following qualifications:
   1. Must be financing 70% or more of the purchase price.
   2. Mortgage term at least one year & Mort balance cannot be reduced by more than $11,000 or below 70% of the amount borrowed, during the 1st year.
      
   3. Purchaser never owned an interest in a principal residence before … anywhere!   
      
   4. Purchase price not to exceed $425,000.
      
   5. B.C. resident for more than one year prior to registration/permanent resident of Canada.
      
   6. Property will be principal residence.
      
   
   *A buyer who ceases to maintain the residence as his principal residence prior to the first anniversary of the registration date may be eligible for a pro-rated exemption.
   
   * A property with a fair market value of up to $25,000 more than the above limits may be eligible for a proportionate amount of the exemption.
   
   *Other requirements may apply-contact Property Transfer Tax info line 1-250-387-0604 or visit: www.gov.bc.ca/sbr (bulletin PTT 004) for details/changes.
   
   *Pre-completion (new homes) Tax is based on “market value” at the time of completion.
   
   
3. Adjustments Costs any prepaid utilities/taxes paid by the seller prior to closing.
   
   
4. Mortgage application and appraisal fees ($150-$350) that the financial institution may charge. 
    
5. Survey certificate/Title insurance (House- $350-$500+), if required by the lender.
   
   
6. Legal Fees for closing and conveyance. $850 - $1,200 +
   
   
7. Property Insurance as required by the lender. (Condo-maintenance includes this)
   
   
8. Harmonized Sales Tax – H.S.T.* NEW HOMES ONLY - (Federal & Provincial - CAN be rolled into Mortgage).

   Combines the Federal G.S.T. (5%) with a newly applied Provincial Tax (7%) for a combined single tax rate of 12%.

   Rebates for homes under $525,000 are available to qualifying purchasers reducing the total H.S.T to 7%.

   Click here for more information and please contact your Accountant/Lawyer for your particular situation.

9. Home inspection -  $350 +  (House will be substantially more)
   
   
10. Sales commissions (Realtors). * Seller pays these fees in most cases.

**January 28, 2009 Federal Budget announcements.

• Home Buyers’ Plan: First-time home buyers may withdraw $25,000/person from RRSP (was $20,000). Or $50k/couple
• First-time home Buyers’ Tax credit- Can claim a 15% non-refundable tax credit to  $5,000 for a maximum credit of $750. (per property purchased) Unused portion may be transferred to spouse.
• Home renovation Tax credit up to $1,350 and ecoEnergy retrofits up to $5,000 (energy improvements) * Expires Feb 1, 2010.