9 costs related to the sale of a house

The reasons for selling a house are as many as they are diverse: a change of job, the desire to buy a new property with your life partner, or the expansion of your family. No matter what is motivating your decision to sell, it is essential to be aware of the various costs related to the sale of your property.

In fact, contrary to what you might think, selling your home does not come without a cost! Although this is not very nice to think about, it does deserve your attention.

1. Works and renovations

Unless your home is a new building, it is likely that some work and renovations will be required to improve it at different levels: insulation, updating of electrical installations, optimization of space, change of plumbing systems or redevelopment of rooms.

While some may be considered secondary, others, such as roof repairs or replacing a badly damaged kitchen counter, can be a disincentive to a buyer, particularly because of the costs involved in fixing them.

Of course, the costs of carrying out this work will depend on its nature and extent. This leaves you with two options: do the work yourself or lower your selling price. In either case, you should expect a loss of profit due to the work that needs to be done on your property.

2. Pre-sale inspection of the property

To identify the work, improvements or corrections to be carried out on your property, you will need to acquire the services of a building inspector.

Although a pre-sale inspection is not absolutely necessary, it is still a good way to identify what needs to be improved in order to obtain your desired selling price. To hire a building inspector, you will have to pay between $450 and $750. Keep in mind that this is a very useful recommendation to follow if you want to sell your home quickly.

3. Tests on the different elements of the house

After inspecting your property, the inspector may ask you to have tests performed to confirm or invalidate the presence of pyrite or vermiculite. To detect the presence of pyrite, a standardized test needs to be performed to determine the type of stone used in your soil to ensure that it does not have the potential to swell. For this test, you will have to pay about $350.

For vermiculite detection, you will need an expert to come and collect samples of your insulation. The total amount required to perform this test will be roughly $1,500 ($400 for the samples, $800 for their analysis and $300 for the written report that will be given to you).

4. The certificate of location

In order to sell your property, you will need to have an updated certificate of location. If yours is a little too old for the buyer's mortgage lender, they may require a newer one. As you can imagine, obtaining this document may represent an additional expense to be borne by you.

However, you should be aware that for this expense to be your responsibility, a clause mentioning the obligation to provide a recent certificate of location must be included in the offer to purchase. If this is not the case, this expense will be borne by the buyer and not by you.

5. Moving

If you want to sell your home, it will be necessary to transfer your belongings to your new home. While some people may use their friends or family to help them to move, others may decide to use the services of professional movers.

The question then arises: how much should I pay for this service? Regarding this point, let's start by saying that the fees that will be charged to you will depend on the number of items that need to be transported from your old home to your new one. To give you an idea of the cost of a standard move, you could expect to pay around $1,200.

6. Early repayment costs

You're selling your house before you're done paying off your mortgage? Unfortunately, you will have to pay your bank an early repayment penalty, as is often mentioned in a mortgage contract.

While it may be difficult to determine the precise amount of the penalty to be paid, it can be calculated in two distinct ways:

• By estimating the amount corresponding to 3 months of interest on the value of the mortgage that will not be repaid. For example, if you have $150,000 remaining to pay on the value of the mortgage and the current rate is 5%, you can estimate that you will have to pay a penalty of $1,875. This is calculated as follows: $150,000 x 4% ÷ 4 (three months, equivalent to one-quarter of the year).
• By assessing the interest rate differential. The difference between the interest rate in effect at the time of the purchase of the property and the interest rate that applies at the time of the sale will be taken into account. Therefore, if the initial rate was 4% and it is now 2% for one year, the differential is 2%. Then, if the value of the mortgage that will not be repaid is 2%, the penalty can be calculated as follows: $150,000 x 2% x 1 year = $3,000.

More specifically, it should be noted that both calculations will be carried out, with the highest sum unfortunately being retained and requested from you.

7. Clearance fees

When selling your property, the notary will have to cancel your mortgage and therefore remove it from the land register. To do this, you may be charged anywhere between $450 and $750.

8. Brokerage fees

Unless you have decided to sell your house on your own, you will likely be dealing with a real estate broker. As you probably know, you will be charged brokerage fees.

How are these determined? Generally, the commission rate is between 4% and 7% of the value of the property and will only be charged by the broker if the broker succeeds in selling the property.

This amount will be used to cover the expenses required to advertise the sale of your home, as well as various expenses, including a contribution to the Organisme d 'autoréglementation du courtage immobilier du Québec, the time invested in research and the rental of an office.

9. Advertising costs

If you are not dealing with a real estate broker, you will have no choice but to advertise your property yourself and to bear the costs of this. Please note that advertising fees will vary depending on the area where your property is located.

If this is an area where demand is rather low, you will need to redouble your efforts so that your property can stand out enough to find a buyer. Live in an in-demand area? Then you're in luck, because your advertising costs will be lower.

In terms of an estimate of the advertising costs, you can expect to pay between $1,500 and $2,500.

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