Review this checklist so the home you buy doesn’t break the bank.
Consider these 8 home-related expenses:
- Home inspection fee: Before closing, it’s customary for the buyer to hire a home inspector to confirm the home meets building standards and is “up to code” for that city. The inspection cost is based on the size and complexity of the home’s systems, but on average the fee should be between $375 and $500, according to our BMO Home Buyer’s Guide. You are responsible for paying this to the inspector. It’s a good idea to make your offer conditional, based on a successful home inspection. Sure, the house might look beautiful, but your inspector may detect structural or other problems that you can then negotiate with the seller to either fix or deduct the repair cost from the agreed-upon price.
- Appraisal fee: Your mortgage lender will require an appraisal (for example, the current market value of the home) before they’ll finalize your loan. Appraisals generally cost between $250 and $500, according to the Canadian Mortgage and Housing Corporation (CMHC), and you may have the option to roll it into your closing costs.
- Utility bills: Unlike renters — who may have utilities built into their monthly rent payment — homeowners are responsible for all bills, such as water, gas, electric, home phone, cable and Internet. And this can add up faster than you may think. For example, keeping a home warm in the winter and cool in the summer can be pricey, depending on where you live. In fact, heating accounts for a significant part of the total expenses of Canadian households, according to Statistics Canada. Its Survey of Household Spending found Canadians spend an average of $1,895 on electricity, natural gas and other heating and cooking fuel a year. Need help planning? Use Natural Resources Canada’s home energy calculator to estimate how alternative energy sources and energy system replacements could potentially affect your energy bills.