General Information For Buying Your Home
How much will it cost to buy your home?
There are a number of factors to consider when calculating the cost of buying a home. This information is designed to help you understand the steps involved and the associated costs.
Land Transfer Tax & Registration Fees:
A fee of $89.00 is paid to register each Transfer and Mortgage.
A land transfer tax is charged by The Property Registry based on the purchase price or fair market value (FMV) of your home. For example, a house with a FMV of $350,000.00 will cost $4,650.00. In order to calculate the land transfer tax for your property, please go to:
Surveyor’s Building Location Certificate & Zoning Memorandum:
Your bank or credit union will normally require proof that all buildings are located within the property boundaries and that the property is in compliance with local zoning by-laws, meaning there is the minimum distance from the edge of the buildings to the property line. A Building Location Certificate prepared by a surveyor shows the outline of all buildings located on the property, including any buildings that encroach from neighbouring properties. The Building Location Certificate is required by the Planning Authority in order for it to issue a Zoning Memorandum.
This Memorandum states whether the property complies with local zoning by-laws (distances to the edge of the property). A survey for a typical City residential property costs about $650.00 and, depending on location of the property, a Zoning Memorandum costs about $85.00.
Your lawyer will review the Building Location Certificate and Zoning Memorandum to determine if the distances are in compliance with the by-laws as set out in the Memorandum. If the cost of this option is not in your budget, Title Insurance is an other option that is an acceptable alternative for most lenderʼs mortgage requirements.
The Tax Certificate shows the yearly real property taxes and any arrears for taxes and water that remain unpaid. The City or Rural Municipality where the property is located issues the Tax Certificate.
Property Tax Adjustment:
The real property tax year is January 1st to December 31st with taxes due on July 31st for City of Portage la Prairie* properties or September 30th for Rural Municipality of Portage la Prairie* properties. If you take possession of property prior to the tax due date, you are responsible for paying the total taxes for the year. Since the Seller owned the property for the first part of the year but did not pay taxes, a credit is given to you for an amount equal to the their share of the taxes based on the number of days they owned the property. This credit is deducted from the Purchase Price.
If the Possession Date is after the due date, the Seller will have already paid the taxes for the year. In this case, you will be required to pay the Seller for the taxes for the number of days remaining in the year that you will own the property. This amount is added to the Purchase Price.
* Note: Tax due dates are different depending on where the property is located.
A Status of Title is ordered from The Property Registry to determine whether there are caveats, mortgages, liens, etc. registered on the property. If there are registered encumbrances, your lawyer will help you determine whether they should be discharged and, in the case of certain caveats such as M.T.S. or Hydro caveats, to advise you of the restrictions they impose on your use of the property. The cost for these searches will vary depending upon the number of liens.
It is important to protect your new investment with insurance. If you are getting a mortgage, your lender will require insurance, with first loss payable to your lender, in order to protect the lenderʼs mortgage. Your local insurance agent can help choose the best policy for your specific needs.
Interest Payable to Seller:
If you are getting a mortgage, the lender will not release the mortgage money to your lawyer until the Mortgage is registered on your property. Between the Possession Date and the date the bank releases your mortgage money, the Seller will not have all of his/her money even though you, as the Buyer, have taken possession of the property. As a result, the Seller is entitled to interest on this mortgage money at the same rate of interest as your new mortgage. While paying this interest to the Seller, you are not paying interest to your bank, that is, you are not paying double interest as your lawyer has not received the mortgage money yet. Any interest not used by the lawyer is returned to you.
This is a basic fee to cover costs that include postage, photocopies, faxes, office supplies, etc.
G.S.T. & P.S.T:
G.S.T. (5%) and P.S.T. (8%) are payable on all legal fees. G.S.T. is payable on some disbursements.
If you would like more details on your purchase or have any questions,
please feel free to contact our office at 204-239-8710.