A home is the biggest investment that most people ever make. This is because a deposit’s cost can be high, and a mortgage can take up to a decade to complete. Fortunately, the value of a home is likely to increase as the property value in your area increases. The property’s value may also increase due to the gradual improvements you might have made to the house. When you are finally ready to sell, many people make the mistake of expecting the full value of the sale in their bank accounts. This rarely happens as there are several costs that you incur when selling a home. This is why you need the services of an experienced Ontario real estate agency to guide you through a smooth house sale. Here are some hidden costs in selling a home:
Lawyer’s Fees
Whenever you handle a large or complex transaction such as a house sale, it is always important to engage a lawyer’s services. An advocate will protect your interests by ensuring that the paperwork is correct and there are no hidden costs. Having handled many of these processes before, a lawyer is in his element when discharging his duty to sell a house. Apart from handling the transfer of the property to the buyer, they also discharge mortgages. Ensure repayment for prepaid expenses and also file paperwork regarding the transfer.
Real estate agent fees
Real estate agents are the bridge between sellers and buyers in real estate. They keep a record of available houses and reach out to the buyers to match them with the house they want. They do the grunt work of the transaction and host open houses. They help the seller choose the right price range and finally negotiate with potential buyers. Real estate agents usually charge a commission of between 4% and 7% of the sale price. Even where the seller does not use a real estate agent’s services, they still have to pay for the buyer’s agent commission, usually 2% to 4% of the sale price.
Mortgage discharge fees
Most homes carry a mortgage which the owners have to continue servicing to completion. Or until they transfer the property, at which point the new buyer owns the mortgage as well as the property. The mortgage discharge fee is a requirement for the financial institution to release the property’s collateral. The payment of this fee is necessary to the sale transaction as it cannot be transferred without the lender’s consent. Mortgage discharge fees usually amount to between $500 and $1,000.
Taxes
Three main taxes apply to a property sale: the land transfer tax, property taxes, and capital gains tax. Land transfer tax applies to all property sales in Canada but varies according to province. In a similar category are property taxes. This varies according to the province, the tax collection rules, and the time of year of the sale. Capital gains tax mostly affects property investors as it applies if the property is not your primary residence and only arises if you profit from the sale. Consult Faris Team Real Estate Brokerage for all your Ontario real estate agency services at https://www.faristeam.ca/.
Faris Team
#14, 431 Bayview Dr
Barrie ON L4N 8Y2, 1.888.444.9533
Toll-free 705-797-8485
Find us on social media:
https://www.facebook.com/FarisTeam
https://www.twitter.com/FarisTeam
Faris Team 