Ihope that you would agree that home buyers need to now all the costs involved in buying a home. Over the years I have found that many buyers are not aware of the fact that there are additional cost of buying a house (called Closing Costs) when buying a house or condo. I had always ‘assumed’ (I know…you’re not supposed to do that), that banks would counsel their clients as to the actual costs involved. Alas, I learned that this is not always so. In this article you will learn about the list of closing costs for buying a house or condo.
Closing Costs when buying a home in Winnipeg
Real Estate Lawyers Costs
The basic real estate legal fees for purchasing a home run around $1200.00 Now, many lawyers will quote something like $399 or $449, but that’s the basic fee. There will be additional expenses on top of that, so you can expect to budget around $1500.00.
Property Taxes
Depending on the time of year you take possession, you may have to pay the remaining taxes for that year. In Winnipeg, our taxes run from Jan to Dec, and are paid in June. What this means, in short, is that if you take possession after June, you will most likely have to pay a portion of the taxes. This is assuming the current owner has paid up the taxes for the entire year. If you take possession before June, you may actually get a refund from the current owner. The joy this brings will be short-lived, however, as you will then be responsible for the full tax bill on June 30th…..So depending on WHEN you take possession, these taxes could form a major part of your overall expenses.
Land Titles Transfer Tax: largest of the closing costs
This one is a real beauty and easily the biggest part of the closing costs. Every sale of a house or condo, whether a re-sale or brand new, is subject to this tax. The kicker is that the more expensive the home, the higher the tax.
So a $90,000 home will cost you $370.00.
A $150,000 home or condo will cost you $970.00.
A $200,000 home will cost you $1720.00
For every $1000 above this price, you can add another $20.00 for our provincial coffers. (You know, to keep our roads nicely repaired and stuff like that)
So if you’re up at a $300,000 house, you’ll be facing a $3720.00 bill….
Winnipeg REALTORS® have actually been lobbying hard, for years, to try and get the Provincial Government to understand that this tax-grab is unfair.
Thank you to my friend Daryl Harris of One-Link Mortgage for pointing this out. There is now a tax on top of the mortgage insurance fee. Daryl gives an example of “$720 for a $250,000 mortgage with 5% down payment” sweeeeet!
Home Insurance
Home Insurance is absolutely required if you are getting a mortgage, and of course highly recommended in any case. This is where houses and condos are different, because in the case of a house, you need to insure the building as well as contents, and your personal liability. In condos (high-rise apartment style) you only insure the condo improvements and your liability, as the building itself is usually insured vie your condo fees (and thru the condo corporation).
In any case, with a house, you should budget between $500 to $1000, and in cases where the home is more expensive, you’ll be looking at more than that. Contact an insurance broker to give you a quote. (If you need one of those, I can refer you to a good insurance broker in Winnipeg)
For condos, your expected cost should be around $250 to $300 (for high-rise condos), but for bare-lands condos you will need to budget more along the lines of what a house would cost.
Mortgage Insurance
NOT REQUIRED. This is a type of Life Insurance that many lenders try to push on the home buyer. I have some rather strong opinions on this, please read the article “Mortgage Insurance or Life Insurance: which should you get?”
Of course, the buyer needs to be aware of moving costs, and other incident expenses.
If you’re looking to buy a house or condo, please give me a call. I work with a lot of first-time buyers, and will take the time to explain the entire process, including all Closing Costs to you.
Also, here are some sample mortgage payments for you to consider.
F.A.Q. about Closing Costs
These are additional fees and taxes, on top of the house or condo purchase price. In Winnipeg, these will include legal fees, Land Titles Transfer Taxes, Property Taxes, and certain banking and registration fees.
Banks will usually tell you that closing costs will be approximately 2% to 2.5% of the purchase price. While legal fees are not usually dependant on the property value, land titles transfer costs are entirely linked to property value.
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Costs for buying a home in Winnipeg | Closing Costs when buying a house or condo | Closing Expenses paid by the home buyer in Winnipeg
About the Publisher
Bo Kauffmann is a residential real estate agent with over 18 yrs experience in helping buyers and sellers achieve their goals. Inducted into the REMAX Hall of Fame in 2010 and receiving the REMAX Lifetime Achievement Award in 2019, Bo has sold over 500 houses and condos in the Greater Winnipeg market. He is an accredited buyer representative (A.B.R.) and a Luxury Home Marketing Specialist.
Bo provides exceptional service to First-Time Home-Buyers, Seniors looking to downsize and Home Sellers of all ages.
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Bo
Thank you Janine for reading and commenting….I appreciate it
Bo
Thank you very much for reading and commenting.
SIidica
I had no idea that buying a house could have all those closing costs involved. Your article is very helpful for people who are thinkiingto buy a house or a Condo in Winnipeg.
David Tjoe
What a good post! This information is very useful for new buyers. Especially those who do not understand this at all, so they can prepare the budget appropriately.
Clarissa
A must read especially to first time buyers. I will definitely recommend you to my friends who wants to buy a house or condo.
janinebocateja
Thank you for the new learning I’ve read about moving and the costs. Never had an idea about this since it’s differen from my country.
oyema111
Getting a loyal agent has been an issue am facing. This ideal is really enlightening as I’m yet to buy my house, never knew about the closing costs. I think house agents should always educate buyers on all of these though on a regular basis. Thanks for this update.
Aissa Jo Quizon
This is really a great read especially for people wondering about closing costs. They now know how much they’ll expect paying and other things asides.
oyema111
You have said the good truth that the basic real estate legal fees for purchasing a home run around $1200.00 Now, many lawyers will quote something like $399 or $449, but that’s the basic fee. There will be additional expenses on top of that, so you can expect to budget around $1500.00. This won’t make me wanna loose any deal with you. Please keep me updated via my email sir. Thanks for this hopeful post.
pranze
I am happy to come across this blog. I just hope people will see the benefit of owner a house. But they should also remember that being able to do so will require patience and financial burden.
Augusta Ukpong Noble
This is really enlightening as I’m yet to buy my house, never knew about the closing costs. I think house agents should always educate buyers on all of these though
meldred judith
This is a very helpful write up. This is such an eye opener to everyone.
Prince
Wow, so depending on WHEN you take possession, spells out how much taxes u will pay. I still believe buying after june is better, or what do you thing Sir?
Wilson Jake
Thanks for touching the Mortgage Insurance issues buys go through and that’s why it’s profitable to go through a professional. I am sure this post will go along way helping serious home buyers. Thanks for this piece
Ricardo Zulueta
This is really complicated. I should see a mortgage broker because I have a lot of questions.
Randall Alvarez
There are many more houses and condos for sale! Keep selling guys! We can do it!
Jamie
If you are selling privately through Comfree and the perspective buyer would like to purchase your home, I understand you can negotiate with their agent to either lower the % received for commission or settle on a finder’s fee (please correct me if I’m wrong!) How much are Agents usually willing to decrease their % received on commission and how much if the finder’s fee (if you chose to go this way).
Bo Kauffmann
Hi Jamie: Pretty much everything is negotiable as far as commissions go. How flexible is the agent? How much time has he/she invested with their buyer before “Finding’ your home?
The other way to look at it is this: If the buyers offer, minus the commission, does not provide enough money for YOU the seller, you are always able to counter-offer for a higher price. Then it is up to the buyer to decide whether its worth it.
Craig Smith
This story reminded me of how I got started buying foreclosed homes in Canada a few years ago.I just want to let everyone who’s thinking of doing this to go for it – it’s not as hard as many people like to make it seem. For example, in my case I didn’t have much money and could not even qualify for a mortgage. Still, I didn’t give up and by looking in the right places I was able to secure properties for as much as 50% below market value. If you’re interested, you might want to check out this article, which explains what I’m talking about much better than I could:
Hope it helps anyone reading this!
Scott Innes
Craig Smith, I would love to hear more of your story. Find me on Linkedin
Bo Kauffmann
Would love to, but ‘Craig Smith’ is not enough info….. here I am on linkedin https://ca.linkedin.com/in/bokauffmann
Ernesto
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Leslie Brlec
Great blog. Thanks for all the great information.
Daryl Harris, AMP
Bo, good post. Another cost buyers should be aware of PST (introduced in the last 2 years) on the Mortgage Default Insurance for anyone with less that 20% down payment. On a $250,000 mortgage with 5% down payment this cost is $720. This can really add up. I also recommend lenders which allow TIPPS program through the City of Winnipeg to avoid the Property tax adjustment which is a huge one in Winnipeg. Not all lenders offer this option with buyers that have a 5% down payment.
Great to see a realtor explain these items, as mortgage broker I do as well, no surprises = happy buyer!
Bo Kauffmann
Thanks Daryl. I’ve updated the article and have included your comment in the post…
Kyle Dunn
I wish I could read your post before. I did know about such closing costs when I purchased my condo last year. No one told me that I have to pay that cost until I made the final move.
Nancy
Hi Bo! It’s very great that you help first time buyers to explain the process about buying house and the closing costs. Many times first time buyers don’t know about it and then they have to pay for it.
Audrey Greenwood
Besides the cost of the house, the costs of moving in to the house is going to be something to think about too! Besides moving company charges and fees, there's buying or renting boxes for packing and keeping your things. It sure isn't easy to buy a house these days with all the money issues that keep adding up!