Buying a new home is something many of us have to do at some point in our lives. It’s also one of the most expensive purchases we’ll ever make. The procedure can be complicated for first-time buyers, and any mistakes can delay this already-lengthy process.
Home inspections and mortgage applications are just the beginning, and there are many steps to take when the paperwork is done. We understand how stressful and confusing purchasing a house can be, so don’t be afraid to contact us. We can help you understand the process and quickly get you settled into your new home.
New Home Purchasing Costs
One of the key expenses is closing costs, which range from 1.5% to 4% of the house’s value in Toronto and surrounding areas. These are fees paid separately from the standard mortgage payments. Other costs to be aware of include:
- Legal costs: Average Real estate lawyer legal fees range from $1,000 to $1,500.
- Land registration: A land transfer tax must be paid to the Ontario government when receiving property ownership. This starts at 0.5% for a $55,000 home and can increase up to 2.5% for a $2 million home.
- Home insurance: The average is $1,250 per year, or around $104 per month.
- Adjustment costs: Any bills or taxes prepaid by the seller need to be paid back after the closing date. This usually ranges from $300 to $500.
- New build GST/HST: These taxes apply to newly built houses, with the Goods and Services Tax (GST) being 5% of the value and the Harmonized Sales Tax (HST) being 13%.
- Home appraisal: A professional appraiser costs between $350 and $700.
- Home inspection: This fee ranges from $300 to $500.
- Moving costs: Generally, a one-bedroom costs $400 to move, while a two-bedroom costs $600. Larger homes can start from $1,500.
Tax Credits for New Homebuyers
Your local government can provide incentives and fees, which you can learn about here. One of the key advantages of being a homeowner is potential tax credits and rebates. These include:
- First-time homebuyers’ tax credit: If this is your first home purchase in four years, you can receive $5,000.
- Homebuyers’ plan: This lets you withdraw up to $35,000 of your pension for a home purchase.
- GST/HST new housing rebate: Paying the HST on an owner-built home can pay up to $24,000.
- Moving expenses: Deductions on moving costs are available.
- Homebuyers’ tax credit for people with disabilities: You can apply for this credit to make a home more suitable for a disabled person.
- Home accessibility tax credit: $10,000 per year is available with supporting documents like invoices and receipts.
- Medical expenses tax credit: Part of your medical fees from the past 12 months can be claimed.
- Rental income deductions: You can claim on any reasonable current and capital expenses.
- Deductions from moving for work or school: Available if you’ve moved at least 40km to work or study.
- Homeowner tax credits when you work from home: You can receive $2 per day if your primary workspace is in your home.
Getting Professional Help For A New Home Purchase
The home-purchasing process can still be daunting even after the paperwork is done. There are many points to consider, such as:
- Moving process
- Home inspection
- Home safety and security
- Home planning and designing
- Home repair and renovation
- Home maintenance
The best way to ensure the process goes smoothly is to hire professional assistance. There are many legal professionals who can help, including:
- Realtor
- Real estate lawyer
- Home inspector
- Insurance broker
- Appraiser
- Land surveyor
- Lender
- Mortgage broker
- Builder or contractor
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More Information on Purchasing a New Home |
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Factors to Consider When Choosing a Home |
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Types of Homeownership |
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Closing Costs When Buying a Home |
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Need help navigating the legalities of purchasing a new home? Consult with a real estate lawyer from Diamond & Diamond today.
“When you start looking for a new home, you need to know for sure how much you can afford to spend. While your mortgage payment and your down payment may be among your biggest expenses, there are many other costs associated with purchasing a home that every homebuyer needs to consider.”
Pro Tip:
Real Estate Lawyers in Toronto
One of the most important people to consult when buying a home is a real estate lawyer. They perform many crucial tasks for you, like title searches and preparing all legal documents.
Toronto real estate lawyers can help you at any point in the home-purchase process. Read this article to discover the many benefits of working with one.
For expert real estate assistance, contact Diamond & Diamond at 1-888-INFOLAW or 1-888-463-6529.
