Home Seller’s Expenses
Costs Incurred When Selling Property
Real Estate Agent’s Commission
Usually this is the largest cost when selling a property. Commission is a fee paid to your real estate agent that represents a percentage of the total selling price you receive for your property. The rate of commission is based on comparative rates around your neighborhood plus Goods and Service Tax (GST). In some cases a seller will offer higher commission than is normal to give incentive to real estate agents to sell their home. If you offer less commission than is normal, this creates less incentive for the buyer’s agent to show your property. There is no standard rate of commission. Once you have met with a real estate agent and the real estate agent has specified their rate, both parties will negotiate until an acceptable rate is agreed upon.
Miscellaneous legal fees paid to a lawyer or notary public for attending to the execution of documents, discharging leans and encumbrances, etc.
* Approximately $350 to $550
Title Clearing Costs
These are fees charged by various institutions to clear the title of your property for transfer. Examples include: discharge fees charged by encumbrance holders and mortgage pre-payment penalties charged by your lending institution. (Check with your lender to determine the balance of your mortgage and your mortgage pre-payment terms.)
This cost only applies to Sellers Not Residing in Canada who need an accountant to apply to Revenue Canada for a T2062 Clearance Certificate on their behalf.
* Approximately $500
Goods and Service Tax (GST)
Federal government tax collected on all goods and services.
* 5% is applied on all commissions when selling a property
* 5% is applied on all fees such as those of inspectors and lawyers
Sales Tax (if applicable) Provincial sales tax is applied on capital gains and may apply to investors when they make a profit on selling revenue properties. This tax does not apply to any principal residence.