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I believe that buying a new home should be a simple and straightforward transaction, with no surprises, hidden fees or unexpected costs. Many new buyers will budget themselves for the cost of their new home, but will fail to account for the additional fees and expenses involved in a home transaction. For this reason, I have compiled a list of the most common unexpected closing costs that often surprise buyers, so that you can be well prepared and financially ready when you go to purchase your next home:

Land transfer tax

Whenever a property changes hands, the new homeowner is required to pay a land transfer tax. The amount to be paid is dependent on the purchasing price of your new home and varies depending on which province you live in.

Home inspection fee

It is very common to include a home inspection as a condition of your offer when buying a new home. A home inspector will ensure that your new home is structurally sound and that all the systems are working properly. A home inspection is particularly important if you are buying an older home, and can help you avoid major expenses in the years to come.

Legal fees

Ensure that your lawyer provides you with a quote ahead of time so that you know exactly what to expect when your legal bill comes rolling in. Before signing your Offer to Purchase, it’s a good idea to go over the conditions of the offer with your lawyer to ensure that you are well protected.

Home insurance

When buying a new home be sure to factor in home insurance, which will protect your home and belongings. Home insurance must be in place by closing day, so, unfortunately, it is not an expense that you can put off until you move into your new home.


Depending on what province you live in, you may have to pay GST and/or PST on your new home purchase. Usually, this is only the case when purchasing a new home, and does not apply for resale properties.

Property survey

Before granting you a mortgage or loan, your financial lender may require you to have an updated survey of your property completed. This helps to establish the boundaries of the property, as well as any easements or right of ways that may be present.

Mortgage default insurance

If your mortgage down payment is less than 20 percent (which is becoming increasingly common these days) then you will be required to purchase mortgage default insurance when buying your new home. Therefore, if you can afford to put down 20% at the time of purchase, you can save yourself from this extra expense.

Moving expenses

While moving day is an exciting time, it can also turn into a pricey day. If you are lucky enough to have your own trailer and friends and family willing to help you out, then your only expense may be beers and pizza at the end of a long day. However, if this is not the case, then you will probably need to rent a truck for the day and possibly a moving crew.

Utility hook-up fees

When you move into your new home you will be required to pay utility hook-up fees. This includes gas, electricity and Internet and telephone services, so be sure to set aside some extra cash for this additional move-in expense.

Decorating & design

When purchasing a new home there are always going to be unforeseen decorating and design expenses. So be prepared for a trip (or ten) to Ikea before your new house looks and feels just the way you want it to.

While this list may seem a tad overwhelming, don’t let it deter you from the exciting venture of buying a new home. When buying a new home, it is important to be financially prepared and knowledgeable of all the hidden and unexpected closing costs that may arise. If you would like more information or are interested in buying a home in the Clarington region, I would be more than happy to speak with you.

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