Buyers Estimate of Closing Costs

Closing costs are one-time fees that the buyer of real estate must pay when they decide to purchase a property. 
Closing costs is an umbrella term for the many various fees related to purchasing a home. 
These costs include but are not limited to land or property transfer taxes, lawyer fees, inspection fees. 
They have to be paid upfront and, in most cases, can't be rolled into your mortgage. Generally, it is a good idea to budget between 3% and 4% of the purchase price of a resale home to cover closing costs. 

When purchasing a new home, in addition to the purchase price, legal fees, and disbursements, you will normally incur a number of additional expenses, including Land Transfer Tax, the Goods and Services Tax (GST) or the Harmonized Sales Tax (HST), and adjustments.

The Balance of the Purchase Price – The purchase price less your initial deposit. Usually, the bulk will come from your lender and become your mortgage.

Legal Fees – Amount varies depending on purchase price and lawyer/notary. This should also include acts such as ordering a title search and registering title. It is safe to estimate about $1000-$1500.

CMHC Insurance Premium – Insurance premium charged if you have less than 20% down payment. It is common for the mortgage broker to include this in your monthly payment.

Title Insurance – Sometimes included in your legal fees ($250-$400).

Strata Documents – Usually ordered by the listing agent or the property, but an updated Form B may be required by the lender or lawyer if there is a long completion and the existing one is out dated. If required for a rush may be up to $100-200 extra.

Strata Move in Fee – One time fee that varies from strata to strata as this is an amount set out in the bylaws for each strata. Safe to estimate about $100-$200 but ranges up to $300.

Property Survey – Lenders may require a survey of the property, which ranges from $500 upwards + GST. This is not required on strata properties.

Home/Fire Insurance – Lenders typically require home buyers with a mortgage to buy home insurance. The insurance should be effective on the earlier of either the completion date or the date that the balance of funds is placed in trust. Most lenders require property buyers to carry fire and extended coverage insurance and liability insurance.

One of the largest additional expenses when purchasing real property is the provincial land transfer tax. The amount the purchaser pays is set by each province, and in some cases, municipalities, and is usually calculated according to a schedule based on the purchase price of the property.
In British Columbia, buyers must pay a property transfer tax, which is based on the fair market value of the land and improvements. The tax is charged at a rate of 1% for the first $200,000, 2% for the portion of the fair market value that is greater than $200,000 up-to and including $2,000,000, and 3% on the portion of the fair market value greater than $2,000,000.

There is no tax payable by the seller.

A first-time home buyer may qualify for a rebate of the tax from the provincial government. 

  • When is PTT Payable on Property Sales in British Columbia?

Again, upon Completion of the Contract of Purchase and Sale (Subject Free Accepted Offer) at the Land Titles Office.

  • GST / HST on the purchase price of new homes
The Goods and Services Tax (GST) and Harmonized Sales Tax (HST) do not apply to the purchase of used homes. If you buy a new home, however, GST or HST will be payable.

Currently, for new home buyers in other provinces, the GST payable is 5% of the purchase price, but most purchasers who buy a property for their own personal use (rather than as an investment property) may be entitled to a partial rebate of the GST, depending on the price and location of the property. Many builders include the GST in the purchase price, while others charge the GST in addition to the purchase price.

  • GST / HST on transaction costs
Even if GST or HST is not payable on the purchase price of your home, GST or HST is payable on other transaction costs, such as legal fees and disbursements, real estate commissions, appraisals, home inspections, and survey fees. GST and HST is not payable on land transfer tax or mortgage insurance fees.

  • GST/HST rebates for new home purchase
The purchase price of resale homes are exempt from the GST/HST, while the purchase price of new homes are subject to GST/HST. If you are a purchaser of a home, your property may qualify for a rebate of a portion of the GST/HST paid. You do not have to be a first-time homeowner to qualify, but the home must be your primary place of residence.

The property will qualify if you:
buy a new home, or a substantially renovated home, from the builder
buy a newly constructed house from a builder, where you lease the land from the builder under the same agreement to buy the house
buy a mobile home (or a floating home, not a house-boat) from a builder
buy a share interest in a newly-built, co-operative housing corporation
build, or substantially renovate your home, or construct an addition
rebuild your home due to fire
Buyers may also be eligible for further provincial and federal GST/HST rebates on various types of new home purchases. Visit for more information.

  • When is GST payable on Real Estate Transactions in BC?

Upon Completion of the Contract of Purchase and Sale at the Land Titles Office.

  • Provincial Sales Tax
If your purchase includes appliances, furniture, or other items that are left in the home, you may also have to pay the retail sales tax on the value of these items in provinces that have provincial sales tax.

  • Adjustments
The amount of money due on the closing date of your purchase or sale will be “adjusted” to reflect the expenses of the property that should be paid by the seller and those that should be paid by the purchaser for the number of days of the year each of the parties will own the property. For example, the purchaser will be required to reimburse the seller if the seller has prepaid any property taxes. If a home is heated by an oil furnace, the seller will usually fill the tank before closing and the purchaser will pay the seller the cost of the full tank.

In addition to taxes and adjustments, purchasers are also responsible for a number of general administrative transaction costs. These include expenses such as legal fees, document searches and registration costs. Purchasers may also need to pay for mortgage insurance, title insurance, and possibly for a survey of the property if the seller is not able to provide them with one.

Property Tax Adjustment – Generally, property taxes are paid on July 1st for a full calendar year. If your move in date is post July 1, you will likely have to provide a reimbursement to Seller of property taxes they paid beyond the closing date. However, this can also be a credited amount back to the buyer depending on the move-in date and whether or not the seller paid the taxes prior to the due date.

Adjustments for Utilities/Condo Fees/etc. – Reimbursement to Seller for prepaid utilities, water fees, strata maintenance fee, etc. (amount varies)

Adjustments for Rentals and Security Deposits – If the home has a rental portion, or you are taking over a rental, the security deposit should be credited to the buyer from the seller. Additionally, if the move in date is past the monthly rental payment date, the seller should credit the buyer for a portion of that month’s rent.

GST – 5% tax based on the purchase price; generally only applicable on newly built homes (ie presale condos). A GST rebate equivalent to 36% of the 5% GST paid is available for new homes priced up to $350,000 and a partial rebate on new homes priced up to $450,000 may also apply to you. GST can be added to your mortgage unless you are receiving a rebate, in which you need to pay your portion of the GST in full. 

For more information on GST and when you need to pay it, read this blog post: Goods and Services Tax (GST) in Real Estate 

After Closing 

What You Need to Pay For After Closing
Moving Expenses ($1,000+)
New locks 
New Fob 
Household Goods (varies)
Utility Connection Charges(varies)
Redecorating and Renovating Costs(varies)
Immediate Repair and Maintenance Costs(varies)
Elevator or move in deposit (refundable by the strata)

Is there a Rebate of BC GST for Real Estate?

Yes. For homes under $350,000 that the buyer intends on living in, there is a full 36% rebate of the GST referred to at the G.S.T. New Housing Rebate. Property purchases between $350,000 and $450,000 is gradually reduced to nothing. Homes over $450,000 get no GST New Home Rebate.

Is there a BC GST Rebate for Rental Properties?

Yes. For new properties a buyer intends to rent out, there may also be a rebate available referred to as the GST New Residential Rental Rebate (GST NRR Rebate). As with the GST New Housing Rebate, the full GST NRR Rebate is only available for new properties under $350,000 and a partial rebate is available for properties priced between $350,000 and $450,000. There is no rebate for properties over $450K

  1. To qualify for this rebate the Buyer must meet certain conditions which include:1. the Purchaser must not be entitled to claim input tax credits in respect of any part of the tax payable on the acquisition of the rental unit.
  2. The rental unit must be a “qualifying residential unit” which means the person applying for the rebate must be the owner of the unit and the unit must be a self contained residence as defined in the Excise Tax Act;
  3. The property must be held by the owner for the purpose of making exempt supplies (for example, a residential tenancy)
  4. The property must be used as a primary place of residence by the tenants and must be so used for at least one year and the Purchaser will have to provide a copy of the tenancy agreement showing a term of at least one year.

How is the BC GST on property sales calculated?

BC GST is calculated on the purchase price of the property as laid out in the Contract of Purchase and Sale.

Is BC GST payable on all property transactions?

No, only new properties are subject to BC HST.

What is the Property Transfer Tax (PTT) in BC?

Property Transfer Tax or PTT is a tax on the transfer of ownership of properties in BC.

British Columbia’s Property Transfer Tax is payable on the fair market value as follows:

  • 1% on the first $200,000.
  • 2% between $200,000 and $2,000,000.
  • 3% on the amount of the fair market value above $3,000,000.
  • 5% on the fair market value above $3,000,000

Is there a PTT exemption for First Time Home Buyers in BC?

Yes, buyers who are BC residents and have not purchased a property anywhere in Canada or the world are are not required to pay PTT when buying a property in British Columbia under $500,000.

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