Home Buyers Information - Part 5/6 - Making an Offer and Closing Costs

You’ve found the right home and are ready to make an offer. An offer is a formal legal agreement to purchase a property and is legally binding once the seller accepts. 

How to make an offer

Offers are usually made with conditions such as financing, insurance and home inspections. If conditions are not met you can change or cancel the offer, even when the seller has previously accepted it.

You’ll need to include a deposit along with your offer. The amount varies based on the purchase price and market conditions. This deposit is presented as a token of good faith to the seller, and is credited to the amount due at close.



Up-to-date government identification will be required once you put your offer in writing. The Federal Proceeds of Crime (money laundering) and Terrorist financing requires that your Real Estate Agent identify all clients involved in the buying and selling of real estate. Identification required includes your name, address, date of birth and occupation for their files, which are kept for a minimum of five years. Financial Transaction and Reports Analysis Center of Canada (FINTRAC) provides more information about the Act on it’s website at www.fintrac-canafe.gc.ca.

Closing and other related costs

Closing costs include the legal, administrative and disbursement fees associated with buying a home. Understanding these fees will help you prepare and budget accurately. These are additional costs above the purchase price of the home.

Land Transfer Tax is a one-time tax levied by the province when you purchase a property. This tax is calculated based on a percentage of the purchase price of the property and varies from province to province. Some municipalities may charge a land transfer tax as well, (i.e. Toronto).

Legal costs cover your lawyer’s fees or in Quebec your notary’s fees for services including:  

  • Reviewing the terms and conditions of the offer
  • Conducting a title search
  • Registering new title
  • Obtaining surveys and evidence of liens on the property
  • Checking statements of adjustment for Taxes, fuel bills etc.

Other costs you may encounter:

  • Interest adjustments
  • GST/HST on new homes or homes that have been extensively renovated
  • Service hook up charges form utility companies (Gas, Internet, Electricity)
  • Appraisal fees if applicable
  • Title insurance
  • Moving /Storage costs
  • Furniture and any appliances not included in the purchase
  • Real Estate commissions

Being prepared for final closing costs is important, as each transaction is different and may require other costs not mentioned here, your Realtor can help explain what may be in addition to your purchase cost, and help prepare you.


Information Source:

Financial Consumer Agency of Canada (FCAC)

Canadian Real Estate Association

Financial Transactions and Reports Analysis Center of Canada