British Columbia · Buyer Report
The price you negotiate is not the amount you need.
Between an accepted offer and the keys in your hand sits a stack of costs that never appear on the listing. In British Columbia the biggest of them is a tax most buyers have never heard of until their lawyer mentions it.
A sensible rule of thumb is 1.5% to 4% of the purchase price on top of your down payment — the spread depends almost entirely on whether you qualify for the property transfer tax exemptions below.
Part one
The big one: property transfer tax
BC charges a tax on the transfer of title itself, payable by the buyer on completion. It is almost always the largest single closing cost.
| Portion of fair market value | Rate |
|---|---|
| First $200,000 | 1% |
| $200,000 to $2,000,000 | 2% |
| Above $2,000,000 | 3% |
| Residential value above $3,000,000 | a further 2% on that portion |
On an $850,000 home that is $15,000. 1% of the first $200,000 ($2,000) plus 2% of the remaining $650,000 ($13,000). It is due on the day you complete, in cash, and it cannot be added to your mortgage.
Two exemptions can wipe most of it out. The first-time home buyers’ exemption covers the tax on the first $500,000 of value where fair market value is $835,000 or less, phasing out entirely by $860,000 — but only if you have never owned a principal residence anywhere in the world. The newly built home exemption works differently and has its own thresholds. Check both against the province’s current figures.
Part two
The other nine
Legal or notary fees
A lawyer or notary reviews the contract, searches title, registers the transfer and handles the money. Budget several hundred to roughly fifteen hundred dollars plus disbursements and taxes, depending on complexity. Get a written quote — quoted fees vary widely and disbursements are often quoted separately.
Home inspection
Typically a few hundred dollars for a standard detached home, more for larger or older properties. It is optional and it is the best money most buyers spend. Book it before you remove your subject conditions, not after.
Appraisal
Your lender may require an appraisal to confirm the property is worth what you are paying, and the fee is yours. Some lenders waive it or cover it — ask, because it is not automatic.
Property tax and utility adjustments
If the seller has already paid the year’s property taxes or a strata fee period, you reimburse them for the portion after your completion date. On a completion early in the year this can go the other way and work in your favour.
Home insurance
Not optional — your lender will not advance funds without proof of coverage in place for the completion date. Arrange it a week or two ahead, not the night before.
Mortgage default insurance premium
If your down payment is under 20%, the premium is added to your mortgage rather than paid at closing. It does not hit your closing-day cash, but it does increase what you owe. It is not subject to PST in BC.
GST on new construction
Resale homes are exempt. A new or substantially renovated home attracts 5% GST. The federal first-time home buyers’ GST rebate can eliminate it entirely on a new home up to $1 million and reduce it up to $1.5 million — worth up to $50,000 — where the purchase agreement was signed on or after 20 March 2025. Check the conditions; they are specific.
Strata documents and fees
If you are buying a strata, someone has to order the form B, the depreciation report, the minutes and the bylaws. There may also be a move-in fee. Small amounts, but they are real and they are yours.
Moving, and the first month
Movers, a damage deposit at the old place, utility hookups, a locksmith. This is the cost that ruins budgets, because it is the one people assume will be small.
Part three
Two things that are not costs, but cost people money
The rescission fee
Since January 2023, a buyer in BC has a Home Buyer Rescission Period — three business days after an offer is accepted in which you can back out. It is not free: the fee is 0.25% of the offer price, paid to the seller. On an $850,000 home, that is $2,125.
Watch out for
The right cannot be waived by either side, and only the buyer has it. Three business days is short. It is a safety net, not a substitute for doing your homework before you write.
The BC Home Owner Grant
A credit against your annual property tax, not a closing cost — but it is money most new owners forget to claim in their first year. It is not applied automatically; you have to apply, every year.
For 2026 the grant threshold is an assessed value of $2,075,000, reducing by $5 for each $1,000 above it. Higher amounts apply for seniors, veterans and people with disabilities. Apply through the province.
Questions we get asked
Can closing costs be added to the mortgage?
Generally no — they have to be paid in cash on completion, which is exactly why they catch people out. The one exception is the mortgage default insurance premium, which is added to the loan. Some lenders offer a “cash back” product that effectively funds closing costs, usually at a higher rate; run the numbers before taking one.
Do I pay property transfer tax if I am buying from a family member?
Possibly not. There is an exemption for a transfer of a principal residence to a related individual, with its own conditions. There is also a separate exemption for transfers between spouses or former spouses under a separation agreement or court order. Your lawyer or notary claims these on the return — raise it early.
Is there GST on a resale home?
No. GST applies to new or substantially renovated homes, not to ordinary resale. There is also no GST on the purchase price of a used home, though there is GST on most of the services around it — legal fees, inspection, commission on the seller’s side.
How much cash should I actually have ready?
Down payment, plus 1.5% to 4% of the price for closing, plus a genuine cushion for the first two months of ownership. Lenders themselves usually want to see about 1.5% available beyond the down payment before they will fund.
Get the real number before you write an offer
We will put together a line-by-line closing cost estimate for the specific property and price you are considering — including whether you qualify for the exemptions. It takes about a day and it costs nothing.
Call 778‑234‑2000 Prefer to write? Send a message insteadPlease note: Tax rates, exemption thresholds and rebate rules change, sometimes mid-year. This page is general information about British Columbia and Canadian rules, current at the time of writing, and is not legal, tax, financial or mortgage advice. Figures and programs change — confirm anything you intend to rely on with the relevant authority or a qualified professional. Sonny Bhinder is a licensed REALTOR®, not a lawyer, accountant or mortgage broker. Not intended to solicit properties currently listed for sale, or to cause a breach of an existing agency relationship.