When property is purchased in Canada, there are other costs related to the transaction beyond the purchase price.
BC Property Transfer Tax: A provincial tax charged every time a property changes hands. The cost is 1% on the 1st $200,000 of value; 2% on the portion of the value greater than $200,000 up to and including $2,000,000; and 3% on the portion of the fair market value greater than $2,000,000. If you are a first time home buyer, and purchasing a property under $500,000 then you are fully exempt from this tax and between $500,000 to $525,000 are entitled to a partial exemption. The full details of this program are outlined here.
Title Insurance: Title Insurance protects the land owner against losses incurred as a result of undetected or unknown title defects.
Legal Fees: If you are selling a property, you will be responsible for legal fees regarding clearing the title for the purchaser. If you are the purchaser, you are responsible for conveyance fees, preparation of statements of adjustment, and mortgage registration.
Property Tax Adjustments: Generally, property taxes for the calendar year are paid at the beginning of July. If you purchase a property before July 1st, the seller will be paying you for the days they owned the home from January 1st to completion day. You then are responsible for the entire amount to be paid to the municipality on July 1st. If you purchase a property after July 1st, you will pay the seller for the days you own the property from completion day to December 31st, as they will already have paid the entire amount to the municipality on July 1st.
House Insurance: Also commonly called Homeowner’s Insurance, this is property insurance that covers private homes. It is an insurance policy that covers losses to one’s home, contents, loss of use, etc.