Buying a home involves sneaky hidden costs that are often overlooked. Be prepared for fees that go beyond the mortgage. The time for you to budget for those "end" expenses is now!
Deposit: Prepare ~5% of the purchase price readily available in cash.
Legal Fees: Lawyer and notary fees are dependent on the complexity of the transactions. A lawyer or notary public represents your needs and interests and will facilitate transactions between you, the seller and the bank on closing day. For straightforward transactions, the average cost will range from $600 to $1,200.
Property Transfer Tax (PTT): For the first $200,000, you pay 1% and 2% for the remaining balance.
Great News for First-Time Home Buyers! Effective as of February 19, 2014, the government has announced a reduction in the tax burden for first-time buyers. Under the PTT First-Time Home Buyers' Exemption program, qualifying first-time buyers can buy a home worth up to $475,000. The previous threshold was $425,000.
More information regarding the reduced tax burden can be found on our previously published blog post: Government Reduces Tax Burden on First-Time Buyers
Stay tuned for additional hidden fees of buying a home in subsequent posts!