Understanding Closing Costs When Buying a Home in Markham

June 10, 2023

Closing costs are an important aspect of purchasing a home in Markham, Ontario. They refer to the additional expenses incurred on top of the property’s purchase price. It’s essential to have a clear understanding of these costs to ensure you budget appropriately for your home purchase. Here are some common closing costs you may encounter when buying a home in Markham:

  1. Land Transfer Tax: This tax is levied by the provincial government and is based on the purchase price of the property. Markham is located in the province of Ontario, so you’ll need to consider both the provincial and municipal land transfer taxes. First-time homebuyers may be eligible for rebates on these taxes.
  2. Legal Fees: Hiring a real estate lawyer is crucial for a smooth transaction. They will review the purchase agreement, conduct title searches, handle the transfer of funds, and ensure all legal aspects are taken care of. Legal fees can vary, so it’s advisable to obtain quotes from different lawyers.
  3. Home Inspection: It is highly recommended to have a professional home inspection before finalizing the purchase. The inspector will assess the condition of the property and identify any potential issues. The cost of a home inspection typically falls between a few hundred to over a thousand dollars, depending on the size and complexity of the property.
  4. Appraisal Fee: If you’re obtaining a mortgage, your lender may require an appraisal to determine the market value of the property. The appraisal fee is usually paid by the buyer and can range from a few hundred to several hundred dollars.
  5. Mortgage Costs: When obtaining a mortgage, there may be various fees involved, such as an application fee, mortgage insurance premium (if applicable), and a mortgage broker fee (if you use a broker). These costs vary depending on the lender and mortgage product.
  6. Title Insurance: Title insurance protects against any issues with the property’s title, such as outstanding liens or encumbrances. The cost of title insurance is typically a one-time payment and depends on the purchase price of the property.
  7. Utility and Property Tax Adjustments: The seller may have prepaid property taxes or utility bills that extend beyond the closing date. As a buyer, you’ll need to reimburse the seller for these expenses.
  8. Moving Costs: While not directly related to the closing process, it’s essential to consider the expenses associated with moving your belongings to the new property.

Remember that these are just some of the common closing costs in Markham, and there may be additional expenses depending on your specific situation. It’s always advisable to consult with a real estate professional or a qualified lawyer to get a comprehensive understanding of the closing costs you can expect when buying a home in Markham.