Although there are lenders who will give you a mortgage with a down payment of 5-10 per cent of the purchase price, it benefits you to provide at least a 20 percent down payment. The government requires mortgage insurance for any down payment of less than 20 per cent. If you are considered a “foreign buyer,” you are required to provide a 30 per cent down payment.
If you aren’t a Canadian citizen or a permanent resident, you are considered a foreign buyer for the purposes of British Columbian real estate. Even if you’ve been living in Canada, you will need to be a citizen or permanent resident to avoid this tax.
Other than the obvious down payment, there are some other costs every buyer needs to account for. Here are the main ones:
Appraisal – Most financial institutions require a property appraisal to estimate the true value of the property. This cost starts around $300 and increases depending on the size of the property.
Home Inspection – In the majority of situations, it’s recommended to carry out a home inspection. It protects you from any nasty surprises and will help to shine a spotlight on any obvious deficiencies. The cost of this will vary with the size of the property. For apartments, it can range anywhere from $300-$600. Townhouses and houses will start around $500 and go up depending on square footage.
Legal Fees/Notary Public Fees – The services of a lawyer or notary public will be required to complete the legalities of the transaction. Their fees usually start around $400, increasing depending on the complexities of the transaction.
Property Insurance – If you are purchasing within a strata property, basic insurance is usually included. This doesn’t include insurance on any upgrades or personal belongings. The cost of additional insurance on a strata property usually starts at $300. Insurance on a detached property usually starts at $500.
The cost and variety of taxes depend on your unique circumstances. Here’s a brief guide:
GST – If you are purchasing a brand new property, you are required to pay GST. This is an additional 5 per cent on the purchase price.
Property Transfer Tax – Unless you are a first time home buyer, you will have to pay PTT at the time of completion.
This rate represents 1 per cent on the first $200,0002 per cent on the portion of the fair market value greater than $200,000, up to and including $2,000,000.
3 per cent on anything above $2,000,000 but below $3,000,000.
Finally, anything above $3,000,000 is levied at 2 per cent.
Talk to the Professionals
Working with a realtor is advantageous for several reasons:
Negotiating Power – Extensive market knowledge paired with industry relationships give us an edge in negotiation.
Market Knowledge – Constant market updates and research over our careers allow us to pinpoint appropriate market value for offers.
Experience – We do this all day every day and are committed to this business.
Facilitate Due-Diligence – Avoiding complications we can communicate with the mortgage brokers, listing agents, and inspectors to try and foresee any complications and deal with them prior to closing.
Protection – We look out for your best interests and uphold confidentiality.
Connections – We have curated an extensive list of trusted industry professionals to form our Home Buyer Concierge Team.
The MLS, or Multi-Listing Service, is a suite of services that realtors use to accumulate and disseminate information on available properties. It lists homes for sale, new homes, re-sale homes, acreage, lots and commercial property.