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The hidden costs of buying a home.

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Well, I don’t know that they’re actually ‘hidden’, but thats the title of this article on MSN Sympatico finance about the extra expenses that people don’t always take into consideration when buying a home.

Purchasing a home is a stressful experience for anyone, but especially for first-time buyers who may not be aware that there are a host of costs other than the actual purchase price and real estate commissions.

It helps to know what those costs are in advance rather than get an unexpected surprise and add to an already stressful experience.
Of course anyone buying in Vancouver today doesn’t have to consider these issues, since they have a billion dollars to spend and property values will increase forever and ever hallelujah!
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Jim

You if it were not for SATV clogging up this otherwise thoughtful blog…..But I can't resist. I am starting my own blog as soon as I figute out how to do it. The working title is either:" I bought at the Top".

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satv

k financial one of my friend his condo was leaking management fix that twice before because of the insurence and contingency fund he did not have to pay three time 6000,8000 last time when that got fixed permanently 12000.I have one condo too and this building need to fix one part of roof budget is around 25000 but owners will pay 2 extra monthly payments only thats from 312 to 500 total by size of condo.rest of money they will take out from contingency fund.now you can imagine 25k by individual owner its big burden.all the new development provide 2,5,10 warranty some of 2,10,10 like that donvon in yaletown.seems like its better than buying a old house.I think 10 % contingency fund is required by law every year.

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kfinancials

SATV,There was alway first time home buyers tax. This is not new. The limit may have change so the figures you are using is incorrect. That's not the additional saving buddy. Have you looked at some of the Condo Minutes lately? Have you looked at their financial statements? I haven't seen any lately with a decent contigency fund.

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satv

bc budget for 2007-08threshold for the first time homebuyers exemption from the Propetry Transfer Tax (1% on the 1st $100,000 and 2% on the balance for any home purchase). it is almost 6,500 under 375,000 purchase price.add almost 2,500 the way fedral govt.announced for 2007-08.k financial this redo reno is common for house's or strata condo.people who own a house they have to pay all reno cost from their own pocket.strata condo you have contingency fund ,insurence all owners to share the cost.which is less expensive than to fix independent properties.warren said.but isn't the Land Transfer Tax the responsibility of the seller?warren thats one sided custom by changing from buyers to sellers, owner might going to lose that twice,because first they have paid to purchase,then they will pay to sell.

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Real estute

Pope, I've searched around on the provincial gov websites of the major provinces to get my data. Even Quebec, the highest taxed region of North America has significantly lower property transfer taxes. My MLA is trying to setup a meeting between myself and the finance minister. I want a justification for this tax. I have to fork out the cash for this tax in a few weeks.

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the pope

Real estute: thanks for the comment on the land transfer tax, do you have any links for comparison of this tax between the provinces?Jesse: the idea of market etiquette keeping someone from offering a lower price is a strange one, I wonder how that would play out in Vancouver..

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the pope

satv: I couldn't find a link to the first article you posted, but here's the second Almost Paradise."..there is trouble in paradise. And nowhere is it more evident than in the Downtown Eastside-a two-kilometre-square stretch of decaying rooming houses, seedy strip bars and shady pawnshops," states the UN agency."Worst of all, it is home to a Hepatitis C (HCV) rate of just below 70 per cent and an HIV prevalence rate of an estimated 30 per cent-the same as Botswana's."

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satv

yes pop I don't mind there was no other choice for me ,the way I said I don't really like to post any link from otherside thanx the pop please proceed.

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kfinancials

There are many hidden cost both during the purchase and when you own the place. Whenever Strata decides to renovate the hallway or redo the roof, every unit owner have to pitch in. With the average buyer leveraging 68% of the pre-tax income to buy a place, they are going to use up their line of credit pretty fast.And the savings you get from those new policies could not even pay for the new carpet in the hallway. It's hard to imagine how $2,500 could influence buying decision. But who's to say, people in the market are not logical.

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the pope

SATV: please use links instead of pasting the whole article. I'm going to remove your comment, but I'll leave it up for a few hours to give you a chance to post a replacement link comment. I don't mind if you post concise quotes that back up your point (whatever that might be), but please not the entire article.

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jesse

OT:Someone I know from California is looking to buy a condo. She said that in her area places for sale rarely sell for less than asking. This is not because the market is hot but because of the standard market etiquette. If you think the price is unreasonable you don't even make an offer. Bidding wars are still possible, though :)Contrast that to Vancouver where lowballs and bidding wars are the norm. What this means is, that in certain US markets anyways, potential buyers won't even consider lowball offers so price reductions will be the way you will see market distress. It also means traffic to certain mis-priced properties will be zilch, which is EXACTLY what is happening in some of the marginal neighborhoods there. In Vancouver I don't know what happens in down markets but the dynamics may not… Read more »

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Warren

Ouch, that does suck.

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Drachen

Ahh, now I understand why the provincial government has been so determinedly looking the other way while a potentially devastating bubble forms.

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Real estute

The land transfer tax is the responsibility of the buyer. This is an evil tax on mobility and is levied at levels far higher than in any other province. This tax has become a winfall for the provincial government as RE values have rocketed skyward. Kind of like tax on gas.

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Warren

You can debate who pays what, since of course the purchase price is negotiable, but isn't the Land Transfer Tax the responsibility of the seller?I'd always tack on 5% for all related costs when considering a home purchase. Its almost like a new car, so many fees/taxes/BS.

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jesse

Not to be confused with "the hidden costs of owning a home" which is a completely different subject.

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