Buying your first home in Ontario is an exciting milestone, but many first-time buyers are surprised by the additional expenses beyond the down payment. These are called closing costs and they’re an important part of budgeting when purchasing Sudbury homes.
Below, we’ll break down what closing costs you can expect, how much they typically are, and how first-time buyers in Sudbury can prepare.
What are closing costs when buying a home in Ontario?
Closing costs are the one-time fees and expenses you’ll need to pay on the day you officially take ownership of your new home. These costs usually range between 1.5% to 4% of the purchase price.
For example, if you’re buying a $400,000 home in Sudbury, closing costs could add up to $6,000–$16,000.
What closing costs should first-time buyers expect in Sudbury?
Here are the most common fees you’ll see:
Land Transfer Tax (LTT): Ontario charges this tax on every home purchase, based on the property’s price. First-time buyers may qualify for a rebate of up to $4,000.
Legal Fees: A real estate lawyer is required to finalize the purchase. Expect $1,000–$2,000.
Title Insurance: Protects you from title fraud or ownership disputes, usually $250–$400.
Home Inspection: Not mandatory but highly recommended. Typically $400–$600.
Appraisal Fee: Sometimes required by your lender, around $350–$500.
Adjustments: This covers prepaid property taxes or utilities that the seller has already paid, which you’ll need to reimburse.
Other Miscellaneous Costs: Courier fees, admin fees, and HST (on certain services).
Do first-time buyers in Ontario get help with closing costs?
Yes! First-time buyers may be eligible for incentives such as:
Ontario Land Transfer Tax Rebate (up to $4,000)
First-Time Home Buyers’ Tax Credit (a federal non-refundable credit)
RRSP Home Buyers’ Plan (HBP): Withdraw up to $60,000 (as of 2024) from your RRSP to put toward your down payment, which can free up more money for closing costs.
How can Sudbury homebuyers prepare for closing costs?
The best way to prepare is to budget early. When planning your purchase, set aside at least 2–3% of the home price for closing costs. A Sudbury realtor or mortgage advisor can help you estimate these numbers more accurately based on the property you’re buying.
Why is it important to understand closing costs before buying?
Many first-time buyers focus only on their down payment, only to feel stressed on closing day. By planning for these expenses in advance, you’ll avoid surprises and feel more confident moving into your new home.
Key Takeaway: When buying your first home in Sudbury, don’t forget to factor in closing costs. They typically add up to 1.5%–4% of the purchase price, but rebates and tax credits can help reduce the total.
📞 Want help navigating the process? Reach out to a local Sudbury real estate agent, such as Tanya Vanden Berg who can guide you through every step of buying your first home.