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Closing Costs You’ll Pay When Buying a Home

Apr 11, 2025
Closing costs include legal and administrative fees. These fees can total up to 4% of the purchase price.
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Written by Kurt Woock
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Closing costs are the legal and administrative fees you'll pay when your home purchase closes.

Closing costs are made up of several one-time fees, so they can add up quickly. It’s important to factor closing costs into your budget before making an offer on the house you want.

How much are closing costs?

Expect closing costs to equal 1.5%-4% of the purchase price of the home.

So, if you are buying a home for $400,000, your closing costs could add an additional $6,000 to $16,000.

This is a pretty significant sum, which is why you need to take closing costs into consideration when making an offer and figuring out your down payment.

The actual amount of your closing costs will depend on several factors, including where you live and what kind of home you are buying.

🤓Nerdy Tip

Use a closing costs calculator to better estimate how much you might have to pay on closing day.

Common closing costs in Canada

Some closing costs are mandatory, some are optional, and some may be specific to your situation.

While not all of these fees may apply to your specific situation, it’s good to keep these costs in mind and factor them into your budget when looking to buy a home.

What it is

Cost

Home inspection

A home inspection is a professional evaluation of a home’s condition. It's optional, but usually recommended.

Between $300 and $600.

Property appraisal

A home appraisal serves as an estimate for the overall market value of the property you are buying.

Between $300 and $500.

Property survey

Identifies the property’s boundaries and any buildings or factors that may impact the overall value of the property.

Between $1,000 and $2,000.

Title insurance

Title insurance protects you and the lender from challenges to ownership due to real estate fraud, municipal work orders, zoning violations and property defects.

Between $150 and $300.

Property insurance

Protects a home against various forms of damage. Must be in place before a lender will advance mortgage funds.

Varies according to property, location and provider.

Mortgage default insurance

Protects lenders against default. Mandatory if a down payment is less than 20%.

Between 0.6% and 5% of the loan amount.

Land transfer tax

Land transfer tax (LTT) is paid by home buyers in all provinces and some municipalities.

Usually a percentage of a home's purchase price.

GST or HST

Charged on new construction if not included in the sale price.

Varies.

Property taxes, utilities and condo fees.

Applies if the seller has prepaid these fees and must be reimbursed.

Varies.

Legal fees and disbursements

The cost of doing business with a real estate lawyer.

Between $400 and $2,500.

Estoppel certificate fee

Protects condo buyers by declaring any debts the previous owner might still be responsible for.

Up to $350.