When you buy a home, there are many expenses that you’re responsible for in addition to the purchase price itself. Here are six “hidden” costs that many people forget about.

Buying a house is a large investment, so it can be easy to focus solely on the purchase price and overlook other expenses that are required to close the deal.

Even for those who have bought a house in the past, you may forget to account for one or two of the additional costs that come with moving homes. On the other hand, if you’re a first-time home buyer, you may not be aware of all of the expenses associated with purchasing a house.

So, what’s included in closing costs for a buyer in Canada? In this article, we’ll outline the six expenses that many people forget to consider when purchasing a home.

Related: How to save for a down payment

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The Hidden Costs of Buying a House in Canada

1. Inspection fees

Many offers will be contingent on a few important subjects. Before the offer closes and the deal is done, these subjects need to be removed.

Having a house inspection is one of the most common subjects that buyers include in an offer. This means that before you officially purchase a house, you’ll be shelling out for this expense.

In addition, land surveys are often required by mortgage lenders to identify the property’s boundaries. So, this expense is also due before you close.

The average price of a home inspection is $500. While the national average cost for a land survey is $422. Typically, you’ll pay for a home inspector and land surveyor to come to the property you’d like to buy, evaluate the home and/or property, and provide you with a detailed report on what they find.

It’s also important to remember that you may need to pay for these services multiple times. For example, if a home inspection reveals that the house you’re interested in has structural issues, you likely won’t move forward with purchasing it. In this instance, you’ll be faced with these fees again when you find another home that you’d like to put an offer on.

2. Closing costs

After you have an accepted offer on a home, you’ll likely have several expenses related to finalizing the deal. You’ll be required to pay for these costs before your closing day.

Legal fees

During this period, buyers are responsible for paying for legal fees that cover the cost of having a real estate lawyer or notary:

  • Complete your official paperwork
  • Review legal documents like the agreement of purchase and the mortgage
  • Ensure there are no claims on the property

Appraisal fees

Other expenses that are associated with closing include the cost of having your house appraised. On average, this is around $400 and will directly impact how much your mortgage lender will loan you.


Once you have an accepted offer, it’s standard to provide the seller with a deposit soon after. This amount is typically around 5% of the purchase price and is not part of your down payment.

Related: What are the costs associated with owning a home?

3. Transfer taxes

Depending on your location, this expense is either known as a Property Transfer Tax (PTT) or Land Transfer Tax (LTT). Unfortunately, it’s quite a large cost that many home buyers don’t consider when budgeting to move.

Applicable in all provinces and territories, with the exception of Alberta, Nunavut, Saskatchewan, and Yukon, the PTT or LTT must be paid by any individual who purchases or gains property that’s registered at the Land Title Office. A few municipalities, including Toronto, also require home buyers to pay both a provincial and municipal transfer tax.

Even if you live in one of the provinces or territories that don’t charge a transfer tax, there’s usually still a small fee that you’ll be responsible for.

If this is your first purchase, check to see if your province or municipality offers a first-time home buyers land transfer tax rebate to offset the cost.

4. Property taxes

Each year, home owners are responsible for paying property taxes. This fee is calculated based on the value of your property, varies by municipality, and ranges from 0.5% to 2.5% of the property’s value.

However, despite this being an annual expense, it’s important to remember that you may also be responsible for paying for any adjustments to the seller. For example, if the previous owner has already paid the annual property taxes, then you will need to reimburse them for the remainder of the year after the closing date.

5. Insurance costs

When it comes to protecting your home and your finances, insurance is an invaluable investment that can provide you with peace of mind.

While many people are aware of homeowner’s insurance, which is a requirement by most lenders to secure a mortgage, there are actually a few other policies that you may need as well.

For example, if your down payment is less than 20%, you must get mortgage default insurance. Often issued by the Canada Mortgage and Housing Corporation (CMHC) and referred to simply as CMHC insurance, this policy enables consumers to buy a home with a minimum down payment as low as 5%.

There’s also title insurance to consider, which varies in cost depending on where you live. This type of coverage is often a more affordable option than having a property survey done. It can protect you from title defects, as well as errors or omissions.

Related: What does homeowners insurance cover

6. Moving expenses

When the deal’s all done and you’re preparing to move into your new home, there’s one more expense that many people forget to consider: moving costs.

While you can always choose to move yourself with the help of friends and family, depending on the amount of things you have, it might not be worth the hassle. To take some of the stress off your plate, you can opt to hire a professional moving company. That said, hiring movers will cost more, since you’ll have to pay the moving company in addition to purchasing packing supplies.

You may also want to budget for storage. If your possession date doesn’t line up with when you need to be out of your old place, you’ll also need somewhere to put your belongings.

Buying a home is one of the largest investments many people make in their lifetime. Get insured and protect yourself, your home, and your finances in just minutes with APOLLO.

Related: Checklist for moving into a new apartment

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