Closing Costs Guide · Value-First Home Team
Closing Costs Guide · Value-First Home Team
Understanding Closing Costs in BC
A breakdown of some of the costs that come due between an accepted offer and the completion date — covering both the buyer's side and the seller's side, including what's mandatory, what's conditional, and what most people underestimate.
Overview
What Closing Costs Are — and Who Pays What
Closing costs are all the expenses that come due between an accepted offer and the completion date — separate from the property price itself. They don't build equity. They don't contribute to the mortgage. They are the cost of completing the transaction.
Both buyers and sellers have their own closing costs, and some items — like property tax adjustments — appear on both sides of the same transaction. Understanding both perspectives is useful whether you are buying, selling, or doing both at the same time.
In BC, buyer closing costs are typically paid in cash on or before completion day and cannot be added to the mortgage (with the exception of CMHC insurance premiums). Seller costs are typically deducted from sale proceeds by the notary before the net amount is released.
Buyer Closing Costs
Typical Range
2–5%
of purchase price, on top of down payment
On a $900K Purchase
$18K–$35K
cash closing costs excluding CMHC and down payment
Biggest Single Cost
PTT
$16,000 on a $900K purchase — paid in cash
Due
Completion
Cash required by the morning of your completion date
Seller Closing Costs
Typical Range
1–4%
of sale price, deducted from proceeds
On a $900K Sale
$9K–$36K
depends heavily on commission structure negotiated
Biggest Variable
Commission
Negotiable — the largest seller cost on most transactions
How Paid
Net Proceeds
Most costs are deducted from sale proceeds at completion
Buyer Costs
The Big One Buyer
Property Transfer Tax (PTT)
Property Transfer Tax is a provincial tax paid by the buyer every time a property changes ownership in BC. For most buyers in Greater Vancouver, it is typically the single largest closing cost — often exceeding all other closing costs combined.
PTT is calculated on the fair market value of the property at the time of transfer, which in most transactions is the agreed purchase price.
2025 PTT Rates
| Portion of Purchase Price | Rate | Tax on That Portion |
|---|---|---|
| First $200,000 | 1% | $2,000 |
| $200,001 – $2,000,000 | 2% | Up to $36,000 |
| $2,000,001 – $3,000,000 | 3% | Up to $30,000 |
| Over $3,000,000 (residential) | 5% | 2% additional surcharge on portion over $3M |
PTT at Common Price Points
$700,000
$12,000
1% on first $200K + 2% on $500K
$900,000
$16,000
1% on first $200K + 2% on $700K
$1,100,000
$20,000
1% on first $200K + 2% on $900K
$1,300,000
$24,000
1% on first $200K + 2% on $1.1M
$1,600,000
$30,000
1% on first $200K + 2% on $1.4M
$2,200,000
$44,000
1% + 2% + 3% tiers applied progressively
PTT is due on completion day in cash — it cannot be added to your mortgage. On a $1,000,000 purchase, that is typically $18,000 out of pocket on closing day, on top of the down payment. This is one of the most common costs buyers underestimate.
PTT Exemptions Buyer
Who May Be Eligible to Avoid PTT
There are two major PTT exemptions available to residential buyers in BC. Both were significantly expanded in 2024. Eligibility depends on specific criteria — confirming qualification with your notary or lawyer before completing is advisable.
First-Time Home Buyer Exemption
Full Exemption
Up to $835,000
Partial
$835,001 – $860,000 (phases out)
Max Savings
Up to $8,000
Who Qualifies
Canadian citizen or PR · Never owned a principal residence anywhere in the world · BC resident for 12+ consecutive months immediately before purchase (or filed 2 BC income tax returns in last 6 years)
Conditions
Typically must move in within 92 days · Occupy as principal residence for at least 1 year · Property on land ≤ 0.5 hectares
Note
Commonly applies to the first $500,000 only — PTT is still payable on the portion from $500,001 to $835,000.
Newly Built Home Exemption
Full Exemption
Up to $1,100,000
Partial
$1,100,001 – $1,150,000 (phases out)
Max Savings
Up to $20,000
Who Qualifies
Canadian citizen or PR · Purchasing a newly built home, new condo, or manufactured home on vacant land · Does not need to be a first-time buyer
Conditions
Typically must move in within 92 days · Occupy as principal residence for at least 1 year · Land ≤ 0.5 hectares
Note
Available to repeat buyers — purchasing new construction may qualify even if you have owned before.
Your lawyer or notary applies the PTT exemption at the time of registration. You are legally responsible for the accuracy of the claim — inaccurate declarations can result in penalties equal to the exemption amount.
Foreign Buyer Note
BC's additional 20% PTT for foreign nationals in specified regions including Metro Vancouver has been extended to January 1, 2027. Foreign nationals and non-PR residents are not eligible for standard PTT exemptions.
Family Transfer Exemptions
Transfers of a principal residence between certain related individuals may be exempt from PTT if the property was the transferor's principal residence for at least 6 months before transfer, among other conditions. A lawyer or notary can confirm eligibility.
High-Ratio Mortgages Buyer
CMHC Mortgage Default Insurance
If the down payment is less than 20% of the purchase price, mortgage default insurance is mandatory under federal law. Commonly called "CMHC insurance," though private insurers Sagen and Canada Guaranty offer it at the same rates. The insurance protects the lender — not the buyer. The buyer pays for it.
Added to the Mortgage — Not Cash on Closing
Unlike PTT, the CMHC premium is not paid in cash on closing day. It is added to the mortgage balance and paid off over the amortization period, increasing total borrowing and the total interest paid.
Maximum Purchase Price for Insured Mortgages
CMHC insurance is only available on homes purchased for $1,499,999 or less. At $1.5 million or more, a minimum 20% down payment is required and mortgage default insurance is not available.
2025 CMHC Premium Rates
| Down Payment | Loan-to-Value | Premium Rate | On $700K Mortgage | On $900K Mortgage |
|---|---|---|---|---|
| 5% | 95% | 4.00% | $28,000 | $36,000 |
| 10% | 90% | 3.10% | $21,700 | $27,900 |
| 15% | 85% | 2.80% | $19,600 | $25,200 |
| 20%+ | 80% or less | None | $0 | $0 |
30-year amortization: As of December 15, 2024, first-time buyers and buyers of newly constructed homes may access 30-year amortization on insured mortgages. Choosing 30 years typically adds 0.20% to the CMHC premium rate. The lower monthly payment comes at the cost of a higher insurance premium and more total interest paid.
Minimum Down Payment Rules
Under $500,000
Minimum down payment is typically 5% of the full purchase price.
$500,000 – $999,999
5% on the first $500,000 plus 10% on any amount above. On a $750,000 purchase: $25,000 + $25,000 = $50,000 minimum.
$1,000,000 – $1,499,999
Minimum 20% down payment. CMHC insurance may still be available depending on the specific transaction.
$1,500,000+
Minimum 20% down payment required. CMHC insurance is not available — the mortgage is uninsured regardless of down payment size.
Other Buyer Costs Buyer
All Other Buyer Closing Costs
Beyond PTT and CMHC, here are the other costs buyers typically encounter between an accepted offer and possession day.
Legal / Notary Fees
A BC lawyer or notary public handles title transfer, mortgage registration, PTT filing, adjustments, and Land Title Office registration. Required for every purchase. Strata purchases and transactions with unusual title matters commonly cost more.
$1,200–$2,200
Mandatory
Title Insurance
A one-time policy protecting against title defects, fraud, survey issues, and certain encumbrances. Most lenders require it. Covers both the lender's interest and optionally the owner's interest.
$150–$350
Typically lender-required
Home Inspection
A professional inspection of the property's condition, systems, and structure. Paid directly to the inspector during the subject period. Not legally mandatory, though widely considered prudent for resale purchases.
$500–$900
Highly recommended
Appraisal Fee
A lender may require a professional appraisal to confirm the property value supports the mortgage amount. More commonly required on high-ratio mortgages or when the purchase price is aggressive relative to comparables.
$350–$600
Lender-dependent
Property Tax Adjustment
BC property taxes are billed annually and often prepaid by the seller. At completion, taxes are prorated to the exact date — if the seller has prepaid more than their share, the buyer reimburses the seller for the remainder of the year.
$500–$3,500
Mandatory adjustment
Strata Fee Adjustment
For strata properties, strata fees are prorated to the completion date. If the seller has prepaid the month's fees, the buyer owes the seller for their portion of the period. Calculated and processed by the notary at closing.
$50–$500
Strata purchases only
Home Insurance (First Premium)
Lenders require proof of home insurance before releasing mortgage funds. A policy effective from the completion date is typically needed, with a binder or certificate provided to the lender and notary before closing.
$1,200–$3,000/yr
Lender-required
Strata Document Review
For strata purchases, a review of financial statements, the depreciation report, meeting minutes, bylaws, and the insurance certificate is widely considered essential. Some buyers review these themselves; others use a professional review service.
$0–$300
Recommended
GST on New Construction
Purchasing a newly built home directly from a builder typically triggers GST at 5% of the purchase price. On a $900,000 new home, that is $45,000. Partial rebates commonly phase out before price ranges typical in Greater Vancouver. Always confirm whether GST is included in or in addition to the quoted price.
5% of price
New builds only
Moving Costs
Professional movers, packing, storage, and housing cost overlap. Moving costs in the Lower Mainland are generally higher than in most other Canadian markets and fluctuate significantly by season.
$1,500–$8,000
Varies widely
Buyer Examples Buyer
Complete Buyer Closing Cost Examples
Illustrative estimates of what buyer closing costs look like at two common price points in Greater Vancouver. Actual costs depend on the specific purchase price, down payment, property type, completion date, and individual circumstances.
Example A: $850,000 Resale Home — First-Time Buyer, 10% Down
| Cost Item | Amount | Notes |
|---|---|---|
| Property Transfer Tax | $15,000 | 1% on $200K + 2% on $650K |
| PTT First-Time Buyer Exemption | − $8,000 | Partial — purchase price above $835K threshold |
| CMHC Insurance Premium | Added to mortgage | 3.10% × $765,000 ≈ $23,700 — financed, not cash |
| Legal / Notary Fees | $1,600 | Estimate — confirm with your notary |
| Title Insurance | $250 | Estimate |
| Home Inspection | $600 | Estimate |
| Property Tax Adjustment | $1,500 | Estimate — depends on completion date |
| Home Insurance (first year) | $1,800 | Estimate — obtain an actual quote |
| Moving Costs | $2,500 | Estimate |
| Total Cash Closing Costs | ~$14,750 | Plus $85,000 down payment = ~$99,750 total cash required |
Example B: $1,100,000 Resale Home — Repeat Buyer, 20% Down
| Cost Item | Amount | Notes |
|---|---|---|
| Property Transfer Tax | $20,000 | 1% on $200K + 2% on $900K — no exemption available |
| CMHC Insurance Premium | None | 20%+ down payment — no insurance required |
| Legal / Notary Fees | $1,800 | Estimate |
| Title Insurance | $275 | Estimate |
| Home Inspection | $650 | Estimate |
| Property Tax Adjustment | $2,000 | Estimate — depends on completion date |
| Home Insurance (first year) | $2,200 | Estimate |
| Moving Costs | $3,500 | Estimate |
| Total Cash Closing Costs | ~$30,425 | Plus $220,000 down payment = ~$250,425 total cash required |
PTT accounts for nearly two-thirds of closing costs in Example B — and that is on a purchase that does not trigger the luxury rate. On a $1.5M home, PTT alone is typically $26,000. On a $2M home, it is typically $36,000. This is why Greater Vancouver buyers are commonly advised to budget 3–5% for closing costs, not the 1.5% figure often cited elsewhere in Canada.
Seller Costs
The Biggest Variable Seller
Real Estate Commission
Commission is typically the single largest cost on the seller's side and is entirely negotiable. It is not set by law, not standardized across brokerages, and not regulated by any government body. The commission structure you agree to with your listing agent is between you and that brokerage.
Commission in BC is typically paid by the seller and is commonly structured to include compensation for the buyer's agent as well — meaning the total commission is generally split between the listing brokerage and the cooperating buyer's agent's brokerage.
An Illustrative Commission Comparison
The table below shows what commission might look like under different structures. These are illustrative examples only. Commission is negotiable and should be discussed directly with any agent you consider working with.
| Sale Price | 7%/$100K + 3% (Comparison) | 2% with $9,950 min — Value-First | Illustrative Difference |
|---|---|---|---|
| $700,000 | $25,000 | $14,000 | $11,000 |
| $900,000 | $31,000 | $18,000 | $13,000 |
| $1,100,000 | $37,000 | $22,000 | $15,000 |
| $1,400,000 | $46,000 | $28,000 | $18,000 |
| $1,800,000 | $58,000 | $36,000 | $22,000 |
Commission is negotiable. The 7%/$100K + 3% structure above is a commonly cited comparison benchmark — it is not a regulated rate. Value-First Home Team charges 2% with a $9,950 minimum; on transactions at or near the minimum, the split between the listing agent and the buyer's agent's brokerage may differ. Seek independent advice and compare commission structures before signing any listing agreement.
GST on Commission
Commission is subject to GST at 5% and is typically charged in addition to the commission rate. On $22,000 in commission, GST adds $1,100. Always confirm whether quoted commission figures include or exclude GST.
Buyer's Agent Compensation
How buyer's agent compensation is structured is evolving in Canada. Many listing agreements still include a cooperating commission offered to the buyer's agent's brokerage, but this is negotiated between the listing agent and seller, not mandated. Clarifying this directly with your listing agent is advisable.
Legal & Financing Costs Seller
Legal Fees & Mortgage Payout
Sellers engage a notary or lawyer at closing to discharge the existing mortgage, prepare and register the transfer documents, and handle all financial adjustments. These fees are generally lower on the seller's side but are still a real cost.
Seller Legal / Notary Fees
Handles discharge of the existing mortgage, preparation of transfer documents, financial adjustments, and disbursement of sale proceeds. Required for every sale.
$800–$1,500
Mandatory
Mortgage Payout Penalty
If the sale closes before the mortgage term ends, the lender commonly charges a prepayment penalty. For fixed-rate mortgages, this is typically the greater of three months' interest or the Interest Rate Differential (IRD) — which can be tens of thousands of dollars. Variable-rate mortgages typically carry only a three-month interest penalty. Confirming the exact payout figure with your lender well before listing is advisable.
$0–$30,000+
Depends on mortgage terms
Mortgage Discharge Fee
Separate from any prepayment penalty, most lenders charge an administrative fee to discharge the mortgage from the title. Your notary will confirm the exact amount.
$200–$400
Most lenders
Property Tax Adjustment (Seller's Side)
If the seller has prepaid property taxes for the full year, the buyer reimburses the seller for their portion. If taxes haven't been fully paid, the seller provides a credit to the buyer. Your notary calculates the exact amount based on the completion date.
Credit or Debit
Varies by timing
Strata Fee Adjustment (Seller's Side)
For strata properties, monthly fees are prorated to the completion date. If the seller has prepaid beyond their ownership period, they receive a credit. If fees are underpaid for that period, the seller makes up the difference.
Credit or Debit
Strata only
Outstanding Strata Levies
If a special levy has an outstanding balance on the unit, this amount is commonly required to be paid out of sale proceeds at completion. Buyers typically ask for confirmation during the subject period — outstanding levies are generally the seller's responsibility to resolve.
Varies
Strata only — if applicable
Other Seller Costs Seller
Pre-Listing, Optional & Tax Considerations
Pre-Listing Home Inspection
Some sellers obtain a pre-listing inspection to identify and address issues proactively. This can reduce surprises during a buyer's subject period, but issues identified are typically required to be disclosed to buyers. Whether and when to get one is worth discussing with your listing agent and lawyer.
$400–$800
Optional
Home Staging
Ranges from a consultation to full staging of a vacant property. The impact on sale price and days on market varies widely by property, neighbourhood, and market conditions.
$500–$5,000+
Optional
Cleaning & Minor Repairs
The condition in which a property is left for the buyer is a negotiated term of the contract. In practice, most contracts include a requirement that the property be left in a "broom clean" or similar state. Sellers typically account for cleaning and minor repairs during listing preparation.
$200–$2,000
Depends on condition
Moving Costs
Professional movers, packing, storage, and potential housing overlap. For sellers downsizing or moving significant distances, costs on the higher end of the range are common.
$1,500–$8,000
Varies widely
Capital Gains Tax (Non-Principal Residences)
The sale of a principal residence is typically exempt from capital gains tax through the principal residence exemption. The sale of a rental, investment, or mixed-use property may result in a taxable capital gain. Tax implications can be complex — consulting a tax professional before listing any non-primary residence is advisable.
Varies
Non-principal residences
Non-residents of Canada selling BC real estate face additional obligations under the Income Tax Act, including withholding requirements and a certificate of compliance process. Non-resident sellers are strongly advised to consult a Canadian tax professional before signing a listing agreement.
Seller Examples Seller
Complete Seller Closing Cost Examples
These examples illustrate what seller-side costs might look like at two typical Greater Vancouver price points. Commission figures use both the Value-First Home Team rate (2%) and the common comparison structure (7%/$100K + 3%) for reference. Actual costs depend on the specific transaction, mortgage terms, and commission agreement.
Example C: $950,000 Sale — Resale Home, Mortgage Ending at Closing
| Cost Item | At 7%/$100K + 3% | At 2% — Value-First | Notes |
|---|---|---|---|
| Commission | $33,500 | $19,000 | Before GST |
| GST on Commission (5%) | $1,675 | $950 | Added to commission |
| Legal / Notary Fees | $1,100 | $1,100 | Estimate |
| Mortgage Discharge Fee | $300 | $300 | Estimate |
| Mortgage Payout Penalty | $0 | $0 | Assumed: term ending at closing |
| Moving Costs | $3,000 | $3,000 | Estimate |
| Total Seller Costs | ~$39,575 | ~$24,350 | Illustrative difference: ~$15,225 |
Example D: $1,350,000 Sale — With Early Mortgage Payout Penalty
| Cost Item | At 7%/$100K + 3% | At 2% — Value-First | Notes |
|---|---|---|---|
| Commission | $45,500 | $27,000 | Before GST |
| GST on Commission (5%) | $2,275 | $1,350 | Added to commission |
| Legal / Notary Fees | $1,200 | $1,200 | Estimate |
| Mortgage Discharge Fee | $300 | $300 | Estimate |
| Mortgage Payout Penalty (IRD) | $12,000 | $12,000 | Illustrative — confirm with lender before listing |
| Property Tax Adjustment | $1,500 | $1,500 | Estimate — depends on completion date |
| Moving Costs | $4,000 | $4,000 | Estimate |
| Total Seller Costs | ~$66,775 | ~$47,350 | Illustrative difference: ~$19,425 |
The mortgage payout penalty in Example D ($12,000) is illustrative. IRD penalties on fixed-rate mortgages can range from a few thousand dollars to well over $30,000 depending on the original contract rate, current rates, and the remaining term. Confirming the exact payout figure with your lender before listing is advisable — it directly affects your net proceeds.
Planning Tips
For Buyers Buyer
How Buyers Can Budget Effectively
Budget Before Setting Your Price Ceiling
Estimate closing costs before deciding on a maximum offer price. On a $950,000 purchase with no PTT exemption, PTT alone is typically around $18,000 — in addition to the down payment.
Ask Your Notary for a Preliminary Estimate
A notary will typically provide a preliminary closing cost estimate once there is an accepted offer. They calculate the exact PTT, adjustments, and their own fees based on the specific transaction.
Check PTT Exemption Eligibility Before You Offer
If you may qualify for a first-time buyer or newly built home exemption, confirming eligibility before submitting an offer is advisable. Small differences in purchase price near the exemption threshold can have significant PTT implications.
Closing Costs Must Be Liquid
Closing costs in most circumstances cannot come from a line of credit or other borrowed funds. They need to be available in your bank account by completion day.
Account for CMHC's Real Cost
CMHC insurance is not a cash cost on closing day but it increases your mortgage balance and total interest paid over time. A buyer putting 5% down on a $750,000 home typically adds roughly $26,000 to their mortgage in insurance premiums alone.
New Builds: Confirm GST Treatment
GST on new construction is one of the most commonly overlooked buyer costs. On a $900,000 new build, GST is $45,000. Confirming whether GST is included in or in addition to the quoted price is important — these represent two very different final costs.
For Sellers Seller
How Sellers Can Prepare Financially
Calculate Net Proceeds Before Listing
Understanding what you will actually net from the sale — after commission, legal fees, mortgage payout, and adjustments — helps inform decisions about pricing, timing, and what you can afford next.
Confirm Your Mortgage Payout Figure Early
Contact your lender before listing to get an exact payout amount and prepayment penalty calculation. IRD penalties in particular can be substantial — knowing the figure before you accept an offer directly affects your net proceeds.
Commission Is Negotiable — Get It in Writing
Before signing a listing agreement, understand exactly what rate applies, what services are included, what portion is offered to a cooperating buyer's agent, and what GST implications apply. Seek independent advice if any terms are unclear.
Principal Residence Status Matters
If the property has always been your principal residence, the sale is commonly exempt from capital gains tax. If the property has ever been used as a rental or for other purposes, the tax implications can be
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