With every home purchase comes closing costs. These are costs over and above the price of the home. Costs can vary, but typically are between 1% – 2% of purchase price.


Typically needed for new homes, the appraisal gives the lender with a professional opinion of the market value of the property. This cost is traditionally the buyer’s responsibility.

Home Inspection Fee

This is pretty standard with any home you purchase that is not newly built. And as much as you may not want to spend, it protects you. Most sales are contingent on the inspection and should anything come up, you can back out. Make sure the inspector has liability insurance just in case they overlook something.

Fire Insurance

To take possession, you will need a certificate of fire insurance to be in place that is at the very least the amount of the mortgage.

Provincial Sales Tax on Mortgage Insurance

If your mortgage is insured, (CMHC or Genworth Financial), you will be required to pay the applicable taxes on the insurance premium on closing. While the insurance premium can be added to the mortgage amount, the tax must be paid at closing.

Land Survey Fee or Title Insurance Fee

Often a recent survey of the property is required by lenders – if one is not available you will need to contract for one at a cost. Many lenders will accept title insurance in lieu of a survey, which can cost considerably less.

Legal Costs

These vary but lawyers and notaries do charge for their time and services including drafting the title deed, preparing the mortgage, and conducting the various searches.

Land Transfer Tax

Ontario charges a land transfer tax payable by the purchaser and is based on the purchase price.

New Home Warranty

For more information on Ontario new home warranty visit www.tarion.com.


HST is payable on the purchase of a newly constructed homes only. If you are purchasing a new home make sure you know who pays this, you or the builder. On the offer the purchase price will say “Plus HST” or “HST Included” and who gets any HST rebates. Many builders have included this cost into the purchase price so the buyer does not have to come up with it at closing.

Closing Adjustments

Inevitably the seller will have prepaid some bills be it property taxes or utility bills. Obviously there may be a refund due the seller effective the closing date.