First Time Home Buyer Costs Most People in Canada Forget
The down payment is not the only cost
Many first-time home buyers focus on saving for the down payment.
That makes sense. The down payment is usually the biggest upfront amount buyers think about.
But buying a home in Canada also comes with other costs before and after closing.
If you only budget for the down payment, the final number can feel surprising.
1. Land transfer tax
Land transfer tax is one of the biggest closing costs in many provinces.
In Ontario, buyers usually pay provincial land transfer tax. If you buy in Toronto, there may also be municipal land transfer tax.
First-time buyers may qualify for rebates, but the tax can still be an important number to calculate early.
You can estimate this using the Closing Costs and Land Transfer Tax Calculator.
2. Legal fees
Most buyers need a real estate lawyer to close the purchase.
Legal fees may include reviewing documents, registering the property, handling mortgage instructions, and completing the closing process.
This is easy to forget because it is not part of the down payment.
3. Title insurance
Title insurance is often part of the closing process.
It helps protect against certain title-related problems, such as ownership issues, title defects, or fraud-related risks.
Your lawyer can explain what applies to your situation.
4. Home inspection
Some buyers pay for a home inspection before finalizing a purchase.
This can help identify possible issues with the home, such as roofing, plumbing, electrical, foundation, or moisture problems.
Skipping this cost may save money upfront, but repairs later can be much more expensive.
5. Property tax adjustments
Sometimes the seller has already paid property taxes for part of the year.
At closing, the buyer may need to reimburse the seller for their share.
This is called an adjustment, and it can add to the cash needed on closing day.
If the seller prepaid property taxes for months when you will own the home, you may need to pay them back your portion at closing.
6. Home insurance
Your lender will usually want proof of home insurance before closing.
Home insurance protects the property and is usually a required ongoing cost.
This becomes part of your monthly homeownership budget.
7. Utilities and setup costs
After moving in, you may need to set up or pay for utilities such as:
- Hydro
- Gas
- Water
- Internet
- Waste or municipal services
These monthly costs can add up, especially for buyers moving from renting to owning.
8. Moving costs
Moving is another cost many first-time buyers underestimate.
You may need to pay for movers, truck rental, packing supplies, storage, cleaning, or time off work.
Even a simple move can cost more than expected.
9. Repairs and maintenance
Once you own the home, repairs are your responsibility.
This can include:
- Appliances
- Furnace or air conditioning
- Roof repairs
- Plumbing issues
- Small fixes after moving in
A home that looks affordable based only on the mortgage payment may feel different once repairs are included.
You can estimate total monthly ownership costs using the Homeownership Cost Calculator.
10. Condo fees, if you buy a condo
If you are buying a condo, your monthly housing cost may include condo fees.
Condo fees can cover building insurance, maintenance, common areas, amenities, reserve funds, and other building expenses.
A lower mortgage payment with high condo fees may still feel expensive overall.
Why first-time buyers should calculate before making an offer
Before making an offer, it helps to understand both upfront and monthly costs.
Buyers should estimate:
- Down payment
- Closing costs
- Land transfer tax
- Legal fees
- Monthly mortgage payment
- Property taxes
- Utilities
- Insurance
- Maintenance
You can start with the Mortgage Payment Calculator and then estimate total ownership costs after.
Simple summary
First-time home buyers in Canada often remember the down payment but forget many other costs.
Closing costs, land transfer tax, legal fees, insurance, utilities, moving costs, repairs, and maintenance can all affect your real budget.
Before buying, run the full numbers so the home feels affordable after closing day, not just on paper.
Frequently Asked Questions
What costs do first-time home buyers forget in Canada?
Many buyers forget closing costs, land transfer tax, legal fees, title insurance, property tax adjustments, utilities, home insurance, moving costs, and maintenance.
Are closing costs separate from the down payment?
Yes. Closing costs are separate from the down payment and usually need to be paid around closing day.
Should first-time buyers calculate total homeownership costs?
Yes. The mortgage payment is only one part of owning a home. Property taxes, insurance, utilities, maintenance, and condo fees can change the full monthly cost.
Last updated: June 2026