Updated on April 1st, 2021
Buying: What are the one-time costs?
Set aside the equivalent of 3% to 5% of your property value for these inevitable costs:
- land transfer tax (commonly referred to as the welcome tax in Quebec)
- notary or lawyer fees
- adjustment of municipal and school taxes
- mortgage insurance premium1
- professional services such as a home inspection and appraisal
- moving expenses
- standard service connection fees (electricity, gas, telecommunications, etc.)
Setting up your home
Sometimes, little expenses here and there can add up. In particular, keep in mind the cost of:
- purchasing new furniture and/or household appliances
- interior decorating: blinds, curtains, lighting, carpet cleaning, painting, etc.
- outdoor renovations: installing a fence, landscaping, adding a pool, etc.
- small odd jobs and slightly more substantial renovations
Need to renovate your new home?
RenoAssistance - External link. This link will open in a new window. has a list of verified contractors in your area.
Building your own home? Your one-time costs will go up as you’ll also be paying for:
- the preparation of plans and specifications
- a building permit
- sales taxes
- possibly water and/or soil analysis
Recurring costs: Up to 32% of your gross income
Once you’re settled in, you’re still not off the hook. It’s recommended that you set aside up to 32% of your gross income on annually-recurring fixed costs. These typically include:
- your mortgage loan payment
- standard service fees (electricity, gas, telecommunications, etc.)
- home insurance, life and disability loan insurance
- municipal and school taxes
- condo fees, if you live in a condo
- RRSP repayment if you participated in the HBP
Selling: The most common expenses
Few people realize that it’s just as important to budget for the following expenses when selling your home, especially if you’re also buying a new property:
- paying your mortgage balance (this one goes without saying), but it’s possible you’ll also be charged a prepayment penalty if you pay your loan in full before the end of your contract. Assess this amount properly with your financial institution before deciding whether to sell.
Use our calculator to estimate your mortgage prepayment charges - External link. This link will open in a new window..
Note that the lender may not impose a penalty if you buy a new property and take out a new loan with the same institution.
- updating your certificate of location, a document that’s required for notarized transactions
- taxable brokerage fees (the percentage specified in your contract with your real estate agent)
- repairs, tests or analyses that the sale of your property is conditional on
- a release fee, allowing you to register your mortgage discharge with the land registry
- municipal and school tax adjustment
- moving expenses
Don’t hesitate to ask your financial advisor or real estate broker for their valuable advice-they’re your allies.
1. If you have a down payment of between 5% and 20% to purchase your home, you’ll have to take out mortgage insurance from Canada Mortgage and Housing Corporation (CMHC) or Sagen. You’ll have the option of paying it off as a single lump sum or adding it to your mortgage amount and amortizing the payment.