When you buy a home in Canada, the sticker price isn’t the only thing you need to save up for. There’s a whole other set of expenses called closing costs — and they can catch buyers off guard if you’re not prepared. These are one-time, upfront fees you need to pay on or before your closing day, and they usually aren’t included in your mortgage.
So, how much should you budget? Most experts recommend setting aside 3% to 5% of your home’s purchase price to cover all closing costs. That might seem like a lot, but once it’s paid, you’re done. No recurring payments here.
Here are the key closing costs buyers should plan for:

New Home Warranty Enrolment Fee If you’re buying a newly constructed home, the builder must enrol the property in a warranty program before starting construction. This warranty protects you from structural defects and other issues down the line. The enrolment fee is usually passed on to you, the buyer, and can range anywhere from $385 to $1,500 depending on the purchase price. Sometimes it’s included in the home price, but not always.

Appraisal Fee Your lender may require an appraisal to confirm the home’s market value matches the price you’re paying. The cost of an appraisal varies depending on your location and the complexity of the property but typically ranges between $300 and $500. It’s a small fee for peace of mind.

Land Survey Fee Not all buyers need a new land survey, but your lender might ask for one. It shows exactly where the property lines are and helps avoid future disputes with neighbours. If no current survey exists, you might have to get one done. Expect to pay $750 to $1,000.

Utility Hook-Up Fees Before you move in, you’ll need to get your utilities connected. This includes hydro, electricity, gas, water, internet, and cable. Some companies charge hook-up or activation fees when starting a new account or transferring service. These costs are usually modest, but they can add up if you’re setting up multiple services at once.

Prepaid Property Taxes If the seller has already paid the property taxes beyond your closing date, you’ll have to reimburse them for the overage. This amount will appear on your Statement of Adjustments and must be settled as part of your closing costs. It ensures each party pays their fair share of taxes.

Prepaid Condo Fees Buying a condo? The seller may have prepaid their monthly condo or maintenance fees. Just like with property taxes, you’ll be responsible for reimbursing them from the date you take possession to the date their payment runs out. This will also show up on your Statement of Adjustments.

Prepaid Utilities In some cases, the seller may have prepaid utilities like gas, water, or hydro. You’ll be expected to cover your share from the closing date onward, and these amounts will also be itemized in your closing documents.

Final Thoughts Buying a home is exciting, but it comes with a lot of hidden costs beyond just your mortgage and down payment. Closing costs might feel like a laundry list of small expenses, but they can easily total thousands of dollars. The good news? They’re one-time costs. Once you pay them, you can move in and breathe easy.

Plan ahead. Budget wisely. And always ask your mortgage broker or real estate agent for a full estimate of your closing costs before signing on the dotted line.
With affordability continuing to erode across the country, you might want to read more on affordability & income requirements to understand what’s driving the increase in monthly housing costs.