Costs of Home Ownership

Costs of Home Ownership


The purchase price of your home is only one of the costs you’ll encounter. Here are other possible costs you need to consider:

APPRAISAL – $250 – $350

This is the fee for determining the property’s lending value for mortgage purposes. This value may or may not be the same as the purchase price of the home.

Home Inspection Fees – $250 – $500

The home inspector evaluates the structures & systems that make-up the home and provides you with a written report. While not a requirement, many home buyers make a professional home inspection a condition of their “Offer to Purchase”.

Insurance Costs for High-Ratio Mortgages – .50 – 2.75%

If your down payment is less than 20% of the purchase of the price of your home, you must pay a one-time insurance amount of your loan premium.

The insurance is calculated on a sliding scale based on the amount of mortgage as outlined below:

Mortgage Amount

Insurance Premium*

Up to & including 65% of purchase price 0.50%
Up to & including 75% of purchase price 0.65%
Up to & including 80% of purchase price 1.00%
Up to & including 85% of purchase price 1.75%
Up to & including 90% of purchase price 2.00%
Up to & including 95% of purchase price 2.75%

*Note: The insurance premium gets added to the mortgage. Premiums in Ontario are subject to provincial sales tax – the sales tax cannot be added to the loan amount

LAND TRANSFER TAX – See calculations below

These fees are paid to the government whenever a property changes ownership.

Ontario Land Transfer Tax

Total Purchase Price

Calculation of LTT

$0 – $55,000 .005 x Price
$55,000 – $250,000 (.01 x Price) minus $275
$250,000 – $400,000 (.015 x Price) minus $1525
> $400,000 (.02 x Price) minus $3525

 

Toronto Municipal Land Transfer Tax

Total Purchase Price

Calculation of LTT

$0 – $55,000 .005 x Price
$55,001 – $400,000 (.01 x Price) minus $275
> $400,000 (.02 x Price) minus $4275

Legal Fees/Disbursements – $800 (fee) plus $400 – $500 (disbursements)

Ensure your lawyers quote includes all related expenses.

Title Insurance – See calculations below

Is optional and covers problems that may arise due to survey irregularities, power of sale issues or other issues relating to the property’s previous owners.

Freehold Resale Title Insurance**

Total Purchase Price

Calculation of Title Insurance

$0 – $500,000 $325.00
> $500,000 $325.00 plus ($0.90 per every
additional $1,000.00 in purchase
price above $500,000) OR
(Price less $500,000 / 1,000 x .90) plus $325.00

Examples:
$1,000,000 purchase price – Title Insurance calculation is (1,000,000 – 500,000 / 1,000 x .90) + $325.00 = $775.00
$2,000,000 purchase price – Title Insurance calculation is (2,000,000 – 500,000 / 1,000 x .90) + $325.00 = $1,675.00

Condominium Resale Title Insurance**

Total Purchase Price

Calculation of Title Insurance

$0 – $500,000 $150.00
> $500,000 $150.00 plus ($0.90 per every additional $1,000.00 in purchase price above $500,000) OR (Price less $500,000 / 1,000 x .90) plus $150.00

Examples:
$1,000,000 purchase price – Title Insurance calculation is (1,000,000 – 500,000 / 1,000 x .90) + $150.00 = $600.00
$2,000,000 purchase price – Title Insurance calculation is (2,000,000 – 500,000 / 1,000 x .90) + $150.00 = $1,500.00

**Premiums based on Stewart Title Guaranty Company. There may be some variation in premiums with different insurers. May be subject to solicitor’s administration fees.

Property Survey – $1,000 – $2,000

A document that illustrates the property boundaries and measurements, specifies the location of buildings on the property, and indicates any easements or encroachments. This may not be required if Title Insurance is obtained.

Adjustments – $400 – $700

You will be required to reimburse the seller for any prepaid property taxes or utility bills.

Moving Costs – $1500 – $5,000

The cost of the services of a professional mover or a rental truck if you move yourself.

Home Insurance – $1,000 – $2,000/yr

Protection of your home and contents.

Miscellaneous Costs – $500 – $2,000

Incidental costs.

*All costs are approximate or “on average” costs.