Extra Costs of Home Buying in London
You have found your dream home for sale in London and your real estate agent managed to snap it up quickly. Congratulations! Just be careful because purchasing a home, inevitably, will come along with many extra costs on top of the stated purchase price. These hidden costs are more complex than they appear to many Buyers and it is advisable that you figure them out to avoid unnecessary disappointments on closing day. A great real estate agent will prepare you for these extras. We are here to explain the most common hidden or extra costs involved with home buying.
Lenders may use appraisals by professional real estate appraisers to determine amounts of money to give mortgage borrowers. Before buying a home in London, your lender may require that you hire such a professional to value the property. Appraisals vary in price, often approximately $295-$395, so be sure to find out if an appraisal is necessary. As real estate agents in London, we work with many appraisers; check out our ‘Preferred Vendors” page for some great resources.
Your bank or lending institution may require an updated property survey before you buy a home. Any great real estate agent can help you organize for this.
Home Inspection Costs
It is advisable that before you make the purchase, you have the house professionally inspected. Even the newest home can have some defects that only a trained specialist will spot. And what’s more? You can potentially use the information you get from the inspection as leverage during the pricing negotiations. Most Realtors will tell you that having a home inspection is important because you will get to know the property better. Learning more about your new home only helps you understand how to maintain it and even ready yourself for any issues that creep up. The more you know the better. Let the real estate agents at Van Bart Real Estate Brokerage Inc. help you learn more about your new property!
Of course, you are aware that you have to pay property taxes. Depending on the down payment, lenders can include the property taxes in the monthly mortgage payments. Otherwise, the lenders often require annual proof that you are paying the property taxes.
Pest inspection Fees
It is professionally advisable that you should hire a trained specialist to do a pest inspection beforehand especially if there are even minor signs of pest activity. A senior scientist for the Canadian Pest Management Association, Greg Baumann explains that it is wise to have a pest inspection done before closing. Pests like wood destroying termites can lead to significant loss. He advises buyers to consider a separate inspection done for wood-destroying pests. This will cost around $200 usually.
Home insurance usually covers the contents and structure value of your home. Since homeowners insurance protects the lender’s investment on loan, the lending institution will request that you obtain a homeowners insurance plan. Your real estate agent can give you advice on where to get your new home insured.
Be prepared to pay some extra fees before you can finally sign the closing documents. Closing costs can include title insurance fees, underwriting fees, survey fees, processing fees, recording fees, etc. Ask your real estate agent in London to help you estimate these costs. If you are with Van Bart, this is a standard service we offer all of our clients. The closing costs vary greatly depending on the purchase price and whether or not you are a repeat or first-time homebuyer.
Unless you are moving houses which are close to each other, you are likely to incur a few more hundreds to thousands of dollars in moving costs. You may have to bear packing and storing expenses. Hiring a professional mover is a smart idea, not only do the movers know what they are doing you don’t have to break your back moving all your household possessions! More resources can be found on our preferred vendor’s page.
Moving can be a significant expense, especially to those moving across the country. But it’s not always all bad! If your job is the reason you are moving, your employer may have a policy to help with your move and some of the moving costs, and portions of the move for work may qualify for tax deductions in Ontario.
Maintenance and Repair expenses
These costs can include gutter cleaning, driveway repair, fixing wiring and plumbing, painting and replacing roof shingles. Maintenance and repair costs often depend on the age of your new home, climate, and the previous owner’s upkeep. Home ownership is very rewarding, but it also can be lots of work!
Be sure to budget for expenses of setting up water, gas, and electricity. These costs will usually vary from region to region and depend on consumption. It is advisable that would-be buyers ask sellers for good-faith monthly utility estimates before closing; your real estate agent can definitely help with these requests
Other extra costs incurred when buying a home include:
• Legal fees. A lawyer is always involved in reviewing the paperwork.
• Mortgage Broker’s fees
• Mortgage loan insurance fees
• Land transfer tax
• All that new furniture to fill your dream home!