First-time buyers who budget only for their down payment are consistently surprised by closing costs. In Quebec, these additional expenses are predictable - but they must be planned for separately from your down payment. Here is a complete breakdown of what to expect.
Welcome Tax (Taxe de Bienvenue)
Quebec's welcome tax - formally the Land Transfer Tax - is often the largest closing cost. It is calculated on a sliding scale based on the purchase price:
- 0.5% on the first $55,200
- 1.0% on $55,201 to $276,200
- 1.5% on $276,201 to $552,300
- 2.0% on the portion above $552,300 (and higher rates apply at $1M+ in Montreal specifically)
On a $550,000 purchase in Montreal, the welcome tax would be approximately $7,350. Budget for this as a separate expense from your down payment - it is due within 30 days of the notarial signing.
Notary Fees
In Quebec, the buyer chooses and pays the notary who handles the closing. Notary fees for a standard residential transaction typically range from $1,200 to $2,000, depending on the complexity of the transaction and the notary's rates. The notary conducts the title search, prepares the mortgage and transfer deeds, and registers the transaction.
Home Inspection
A professional home inspection costs $400 to $700 for a typical Montreal property. For plexes or larger properties, expect $600 to $1,000+. This is non-negotiable for first-time buyers - the inspection cost is trivial compared to the cost of a missed structural or mechanical issue.
Mortgage Default Insurance (If Applicable)
If your down payment is under 20%, the CMHC premium is added to your mortgage. However, Quebec also charges a provincial sales tax (9.975% QST) on the CMHC premium at closing - this must be paid in cash and cannot be added to the mortgage. On a $22,000 CMHC premium, the QST would be approximately $2,195.
Other Costs to Budget For
- Moving costs: $1,500–$5,000 depending on volume and distance
- Condo reserve fund adjustment: if you buy mid-year, you may owe a portion of the annual condo fee upfront
- Property tax adjustment: the buyer reimburses the seller for prepaid property taxes
- Immediate repairs or updates after closing
- Home insurance: required before the mortgage funds
Total Closing Cost Estimate
As a practical rule for Montreal first-time buyers: budget 2–3% of the purchase price for closing costs on top of your down payment. On a $600,000 purchase, that means having $12,000–$18,000 available beyond your down payment amount. Better to overestimate and be pleasantly surprised than to arrive at the notary short of funds.