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I have found that many buyers are not aware of the fact that there are additional costs when buying a home or condo.  I had always ‘assumed’ (I know…you’re not supposed to do that),  that banks would council their clients as to the actual costs involved, but learned that this is not always so.  Blame the hectic market pace, understaffing or any number of things, but for whatever reason, it’s not being done.

So when buyers come to me, I sometimes have to give the bad news:  Here are some of the major expenses involved when buying a home (or condo)

Legal Expenses:  The basic legal fees for purchasing a home run around $500.00  Now, many lawyers will quote something like $299 or $349,  but thats the basic fee…….there will be additional expenses on top of that, so you can expect to budget around $500.00  (This will be significantly higher when purchasing a "Private Sale", where the lawyer has to draw up the offer and act on your behalf)

House Taxes:  Depending on the time of year you take possession, you may have to pay the remaining taxes for that year.  In Winnipeg, our taxes run from Jan to Dec, and are paid in June.  What this means, in short, is that if you take possession after June, you will most likely have to pay a portion of the taxes, (assuming the current owner has paid up the taxes for the entire year).  If you take possession before June, you may actually get a refund from the current owner.  The joy this brings will be short-lived, however, as you will then be responsible for the full tax bill on June 30th…..

Land Titles Transfer Tax:  This one is a real beauty.  Every re-sale of a house or condo is subject to this tax.  The kicker is that the more expensive the home, the higher the tax. 

So a $90,000 home (if you can FIND one  of those) will cost you $360.00. 

A $150,000 home or condo will cost you $960.00.

A $200,000 home will cost you $1710.00

For every $1000 above this price, you can add another $20.00 for our provincial coffers  (you know, to keep our roads nicely repaired and stuff like that)

So if you’re up at a $300,000 house, you’ll be facing a $3710.00 bill….

Of course, the buyer needs to be aware of moving costs, and other incident expenses.

The Good News?   Many buyers are also not aware that they wont be making a mortgage payment for about a month AFTER they take possession.  So if you’re moving from an apartment into a house, and you take possession on July 1st, and left your apartment on June 30th,  your last apartment rent payment was likely made on June 1st, while your first mortgage payment will probably not  be made until the first week in August.