What are the additional costs of buying a home?
Once you have decided on the price range of your home and calculated your mortgage payments, you may still have to consider the following associated costs to ensure you can manage the financial load,
- Mortgage insurance – if your down payment is less than 20% of the property price, your mortgage lender may require a mortgage loan insurance to be bought through Canada Mortgage and Housing Corporation (CHMC). The cost is usually between 0.60% to 4.50% of the mortgage loan, based on the size of your down payment.
- Appraisal Fee – Your mortgage lender may pass on the appraisal expense to you.
- Property Insurance.
- Property Transfer Tax.
- Prepaid vendor costs such as fuel and utility bills.
If you’re buying a new property, the builder may offer optional upgrade packages. This will increase the purchase price of the home but can be rolled into the mortgage and be amortized over the life of the mortgage. After final completion, you’ll be facing ongoing payments such as annual property taxes. If you’re moving into a strata corporation, monthly strata maintenance fees are obligatory.