The real cost of closing on a home - Give Me Back My Five Bucks

The real cost of closing on a home

I feel like when people talk about “closing costs” they mostly talk about what is due to their notary or lawyer, plus a home inspection. But the truth is, there are so many hidden expenses associated with moving and closing on a place that perhaps we might not take into consideration. And they can add up fast!

Here is what I spent on my closing costs:

Cell phone overage ($52.14) – Epically long phone conversations all month long with my Mortgage Broker and Realtor.

Coffee shop expenses ($43.88) – This was over the course of 6 weeks, which accounts for a couple of weekends of open houses, lots of meetings, and many, many nights spent writing until late.

Dining out expenses ($90.82) – This was over the course of 6 weeks while I was in limbo, packing/moving and staying away from the house as much as possible.

Replacement groceries ($325.42) – Because I was moving out of ex-BF’s house, I had the task of starting with an empty fridge. I brought absolutely no food, condiments, spices, and no pantry items.

Household items ($264.80) – Includes cleaning supplies, a few decorative items, and household miscellaneous.

UHaul rental ($102.43) – 10 ft. van rental for 6 hours, plus the cost of gas.

Internet/cable hook-up ($76.16) – This included hook-up fee and wireless modem purchase.

Home inspection ($562) – I loved my home inspector. He was very thorough and helpful. This cost was for my unit and an inspection of the entire building complex.

Credit union fee ($5) – It cost $5 to join VanCity, which is where my mortgage is being held.

House insurance ($221) – 12 months of coverage with a $500 deductible.

CLOSING COSTS (paid to Notary):
Payment of Insurance Binder ($40)
Payment to building complex management ($22.40)
Pro-rated maintenance fees ($142.18)
Strata plan move-in fee ($100)
Legal fees, disbursements & taxes ($1,025)

GRAND TOTAL: $3,073.23

Please note that these expenses do not include furniture or renovation costs. I had originally budgeted $4,000 for the closing cost expenses noted above, and for furniture. And I think I will be right around that amount once I actually buy my furniture. I went to IKEA over the weekend and picked out most of the pieces that I want. I will peruse Craigslist to see if anyone is selling theirs first. As for renovations, that should be around $4,500 in total. I will document the full cost of my renovations and furniture purchases closer to the end of the month once I know final numbers.

About Krystal Yee

I'm a writer, personal finance blogger, and marketing professional based in Vancouver. I'm a former Toronto Star (Moneyville) columnist, author of The Beginner's Guide to Saving and Investing, and co-founder of the Canadian Personal Finance Conference. When I'm not working, you can usually find me running, playing field hockey, or plotting my next adventure.

30 comments

  1. That is actually pretty low for closing costs (including your hidden expenses)!

    I have been trying to figure out how much I will pay in closing costs when I finally due buy a home and it appears it will be approaching $3k without any of the hidden costs you mentioned… I guess I should factor some of those in too and I will be getting close to $5k!
    My recent post Tips for Buying Your First House

  2. Finding My Way

    Finally! Someone with the guts enough to post about their actual closing costs. Thanks for this. I will be a big help when I budget for my own place.

  3. Dang! That's really eye opening. I appreciate all of the facts and figures, that will really help us picture how much we need to buy a house. Enjoyed it!

    Austin
    My recent post What Good is a PF Blogger without Goals

  4. Krystal, Didn't you have to pay property taxes that the previous owner had paid for May or later months? In our case, we moved in December and the previous owner had paid the property taxes for that month as well. So we had to pay him that.

    • I actually got a credit for the taxes from January-May that the previous owners had to pay me, and will end up paying property tax sometime in June which will be about $1,500.

      • Wow, that's great that you didn't have to pay it right away!!

        Lot of people have to pay property tax + land transfer fee (we got a rebate on that because we are first time home owners) during closing as well.
        My recent post The end in sight

  5. I love that you included the cell overage–mine went over by almost $100 due to a crazy amount of daytime minutes spent speaking to my realtor, mortgage officer, and attorney (my unit was a foreclosure and closing literally came down to the last possible minute with updated HUDs coming through as I was already signing other things!). It's really important that people realize the true costs of the move, including all of those miscellaneous fees that crop up. Congrats again!
    My recent post Im Going to Greece!

    • Totally agree! I have a friend who said she only budgeted for her lawyer fees, but when I reminded her of all of the additional other expenses around moving, I think I might have scared her a little. But better learn about them now, than when you're faced with a huge credit card bill!

  6. This is really helpful, thanks!

  7. I'm totally blown away by how affordable your homeowners insurance is! We pay 5 times that and our house was WAY cheaper than yours. :(

    • Yeah, I was actually shocked as well. But I just have a 1-bedroom townhouse, not an entire house! AND I went with the same insurance company that I have my car insurance with, so I got a discount. I also have friends that own houses that pay way, way, way more than I do.

  8. Thanks so much for posting this information. I've always heard that closing costs can vary between 1-5% of your home's price, but it's nice to see some actual dollar values. I would have never thought to include the cell phone bill in the costs, but really, like you said, you're going to be on the phone constantly through the buying process. I may consider seeing if I can add more airtime to my phone when I start looking at places. My biggest closing cost concern is finding a good, fair lawyer, I've heard so many bad things about local lawyers (huge charge rates, losing papers, not filing things) that I'm afraid lawyer fees will eat up what I've set aside for closing costs and I'll have to travel outside of my local area to find a decent lawyer.
    My recent post Judge me and my mock housing budget

    • The thing is, 1-5% of your purchase price is a HUGE range. For my $259,000 home, that would have been a range between $2,590 to $12,950. Also, I asked my Realtor and Mortgage Broker to estimate closing costs for me, and they were relatively close.

      As for finding a good lawyer, I went with a recommendation from my Realtor. If you find a Realtor that you trust, they will be able to provide you with a few options. For example, mine provided me with 3 or 4 options, and gave me descriptions of them, their business, and how they would mesh with my personality. Super super helpful.

  9. I find that the fridge is the most surprising/unanticipated expense of a move. I've moved four times over the past two years (five if you count the one for June 1st) and each time I have to go to the grocery store and plunk down a minimum of $200 to fill my fridge.
    My recent post The End of My Relationship with RBC

    • Yeah, it's crazy how expensive it is! Also I don't have many kitchen appliances, since ex-BF and I bought them together, and I let him keep most of the stuff. :-/

  10. Nobody ever breaks any of that down! Now I know some of it if/when I start looking.

    I know one place that people forget about (especially people moving out of their parents for the first) is the cleaning supplies. They know they have to get food because they eat. But since mom generally does all the cleaning they don't know about the supplies.
    My recent post Happy Mother’s Day

  11. Cleaning supplies were way more than I thought they would be, because you have to buy everything from sponges to detergent to toilet bowl cleaners. I still don't even have a broom or a vacuum. Although, I can probably hold off on the vacuum since I don't have carpet. But still.

  12. Good post Krystal!

    I'm sure this has helped or will help, lots of folks. I think our closing costs for our current home (just moved in December 2010) was just over $6,000. It included land transfer taxes :(
    My recent post My Top Stress Busters

  13. hey,
    really appreciate reading all these posts about your recent house purchases and the various associated intricacies. I'm 27 and looking around for the right property to get my foot on the property ladder so all this information really comes in handy. Your closing cost actually look really good so far, keep the information flowing.

  14. purchase, not purchases….sign of thing to come perhaps?

  15. My son and his wife just bought a home and I'm sending it along for them. I think they would heartily agree with your compilation.

  16. I'm trying to figure out all of our costs so that I can keep my budget/forecast updated for the remainder of the year. The one thing I didn't know about was what the bank called an Interest Adjustment Date.

    Basically how that works is that we take possession on August 1st but we won't actually have to make a payment until September 12th (we're set-up on bi-weekly payments). That payment will be an "interest-only" payment. The regular mortgage payment then commences on September 26th.

    Apparently this is the default arrangement for taking over a new mortgage and the bank claims that people prefer this month or so of lower "interest-only" payments because of all of the extra closing costs that are often unexpected.

    Personally, I'd rather start the mortgage payments sooner so I will have to put a lump sum down during that Interest Adjustment Period in order to prevent that first month-and-a-half from being interest only.
    My recent post Settling In To A Retirement Community

  17. Hi Krystal:

    Just curious what type of mortgage you went with vancity and what rate, I will be closing soon for my new home if the rate is great i can follow Vancity.

    • Hi Sunny, I went with a mortgage broker who got me a 5-year fixed at 3.74% with Vancity.

      • That's great rate for 5 -year fixed,

        Any other charges (file charges, property evalution charges etc.) in addition to the credit union membership fee. Will it be possibe to connect to your broker

        Did you raise your life/disability insurance on buying this property

        • Nope there were no other charges besides the credit union fee. As for property evaluations, I'm assuming that you're in BC? If so, have your Realtor pull a few property valuator reports off of Landcor. Landcor is what the government uses for property assessments. They're about $20 if you buy them yourself off, but your Realtor should have full access/membership subscription.

          No I also haven't raised my life/disability, as I am covered through work. That being said, I will be looking into different options to get more coverage going forward.

          As for my broker, just send me an e-mail at krystalatwork [at] gmail [dot] com and I can pass along his information. Same thing for my Realtor if you don't already have one.

  18. Wow! All those "extra" expenses really add up. Those are easily forgotten about, and hopefully in the future when I buy my first place (whether alone or with someone) I'll remember about this!

    Congrats again and WAY TO GO on budgeting for all of it!

  19. katherinecannon

    Good for you for keeping track!! I'm sure it's because you are so exact and keep track of every expense that you were able to buy!! Congrats!

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