Closing Costs - What You Should Expect

If you are the buyer of a new home, chances are you will be the one responsible for the closing costs. These fees are a normal part of the real estate transaction. In some cases, such as when the owner wants a quick sale, your Realtor® may be able to negotiate with that seller about sharing some of these costs. Some of the items that you should budget for are included below.

Credit Report

Credit reports are normally requested when you apply for your mortgage pre-approval. Depending on when the report is requested, the fee could be added on to the application for that mortgage or considered part of the closing costs for the home sale itself.

Title Search

The title search protects you by finding out if there are any liens or prior claims against the home. Normally costing about $15, it is well worth the cost. Once the search is complete you can then buy title insurance to protect your purchase from future claims. Cost for title insurance is usually about one percent of your home’s value.

Property Appraisal

Buyers are responsible for getting the property appraisal, which normally costs about $300. If you are getting mortgage insurance through CMHC then it is a requirement. A property appraisal lets you know the true value of that property and if it is worth what the seller is asking. The fees are taken care of sometime during the home purchasing process.

Land Title Recording and Documentation Fees

A Land Title is a legal document that must be filed anytime a property changes hands. The fees cover this necessary step and do vary depending on the jurisdiction and their required procedures.

Property Taxes, Condo Fees

The date you take possession of the property determines the amount of property tax you will owe that first year. The exact amount is pro-rated, with the buyer and seller responsible for their respective shares. It’s the same story for condo fees. Another item frequently overlooked are yearly insurance premiums, which are treated the same as the condo fees.


Consider budgeting about 1.5 percent of your new property’s transaction costs to take care of these miscellaneous costs. That gives you a comfortable monetary cushion to fall back on.


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