The base costs to expect when purchasing a property in Quebec
Base costs to plan for when buying property in Quebec
Buying your first home in Quebec is exciting… until you realize that the down payment is only the tip of the iceberg. Between pre-approval, the notary deed, the welcome tax, and all the small start-up costs, the bill can climb quickly if you’re not prepared.
This guide explains, in simple language, which costs to expect when buying a home in Quebec, with a concrete example on a property worth $510,000.
1. The down payment: 5% vs 20% on a $510,000 home
a) Minimum rules in Canada (including Quebec)
For a residential property occupied by the buyer:
- 5% on the first $500,000
- 10% on the portion above $500,000
For $510,000 :
- 5% of $500,000 = $25,000
- 10% of $10,000 = $1,000
- 👉 Actual minimum down payment: $26,000
But to simplify the 5% vs 20% comparison, we use the classic percentages on the total price:
b) Option 1: down payment 5%
- Purchase price: $510,000
- Down payment 5%: $25,500
- Amount to finance: $484,500 (before mortgage insurance premium)
With less than 20% down, your loan must be insured (CMHC / Sagen / Canada Guaranty).
- The insurance premium (variable depending on the down payment percentage) is added to the loan and slightly increases your monthly payment.
- Advantage: you can enter the market faster with less cash on hand.
- Disadvantage: you pay an insurance premium + more interest on a higher amount.
c) Option 2: down payment 20%
- Purchase price: $510,000
- Down payment 20%: $102,000
- Amount to finance: $408,000
- No mandatory mortgage insurance (conventional loan).
Advantages :
- Lower monthly payments
- Less interest over the life of the loan
- No mortgage insurance premium to pay
Inconvenient :
- You need to have a considerably larger down payment, which can delay your home buying project.
2. Possible sources for your down payment
In practice, your down payment can come from a mix of sources:
- RRSP Home Buyers’ Plan (HBP): You can withdraw from your RRSP tax-free, repayable gradually. See the following link for more information https://www.canada.ca/fr/agence-revenu/services/impot/particuliers/sujets/reer-regimes-connexes/est-regime-accession-a-propriete.html
- TFSA: tax-free withdrawals, perfect to supplement your down payment or start-up costs.
- TFSA Home Buyer Plan (TLHP): specifically designed for the purchase of a first property; tax-deductible contributions and non-taxable withdrawals for the purchase. See the following link for more information https://www.canada.ca/fr/agence-revenu/services/impot/particuliers/sujets/compte-epargne-libre-impot-achat-premiere-propriete.html
- Non-registered savings: money in a regular account, non-registered investments, family gifts, etc.
- Gift: Gift from a close family member
3. The mortgage pre-approval: your starting point
Even before you start serious shopping, a mortgage pre-approval is essential:
- It gives you a clear idea of your budget (monthly payments, maximum borrowable amount).
- It locks in a rate for 90 to 120 days (depending on the lender).
- It strengthens your position when making an offer, especially in a competitive market.
Planning: generally no direct fees, but the lender will analyze your situation in detail (income, debts, credit, job stability).
4. Closing costs to expect (in addition to the down payment)
A good rule of thumb: plan for 1.5% to 3% of the purchase price in closing costs in Quebec.
For a house of $510,000, that means about $7,500 to $15,000.
5. Start-up costs for buying a home
Here's a realistic list of start-up costs to plan for
5.1 Transaction-related costs
- Notary for the sale and mortgage
- Welcome tax (land transfer tax)
- Pre-purchase inspection
- Registered appraisal (if required by the lender)
- Title insurance (if used)
- Specific tests (as needed, especially in certain regions)
- Potable water test
- Septic tank inspection
- Account adjustments (municipal taxes, school taxes, condo fees already paid by the seller)
- QB Tax on mortgage insurance premium
- If your loan is insured (down payment < 20%), the premium is added to the loan, but the TVQ (9.975%) is payable at closing.
- Typical example: often a few hundred to $1,500+ depending on the insured amount.
- See the list of estimated costs here: https://www.centris.ca/fr/blogue/finances/achat-de-maison-13-frais-a-prevoir-avant-pendant-et-apres
5.2 Start-up and installation costs
- Move
- Utility connection / service setup
- Appliances (if not included)
- Basic furniture
- Curtains, rods, blinds
- Home insurance (required for the mortgage)
- Basic exterior maintenance (if yard)
- Small contingency fund for unforeseen events
6. How to prepare concretely
- Get your pre-approval before even starting house tours.
- Build your down payment with a mix: HBP, TFSA, TFSAHP, non-registered savings.
- Calculate your budget including:
- Down payment (5% or 20% + closing costs)
- 1.5% to 3% of the price for closing costs
- A cushion for moving and settling in
- Use an Excel file or budgeting app to simulate:
- 5% down payment scenario
- 20% down payment scenario
- Impact of monthly payments on your liquidity.
Conclusion: borrow with preparation, not surprise
The key to a successful home purchase isn’t just getting excited about the kitchen or the yard, but mastering all the base costs:
- Your down payment (5% vs 20%),
- The closing costs specific to Quebec,
- The start-up costs to actually move in.
By preparing with the right tools (HBP, TFSA, TFSAHP, personal savings) and a good pre-approval, you turn a stressful project into an informed and durable decision, whether you are 21 or 65.