Duplex 101 / 03
How Much to Offer on a Duplex, and What It Really Costs to Close
By Sonia Felix, REALTOR® | byfelix.
Oakwyn Realty Downtown
The math most buyers do backwards
You find the one. You start running comps in your head, the market temperature, how many other offers might come in. You are trying to find the number that wins.
The number that matters first has nothing to do with the market. Your offer price is not your final cost.
What sits on top of the purchase price
GST. The 5% federal GST applies to new and substantially renovated homes, including most new duplexes. Check whether the price is written as GST included or plus GST. At West Side price points, the GST rebates for new homes do not apply. The First Time Home Buyers' GST Rebate phases out completely at $1,500,000, and the standard new housing rebate stops well below that.
Property transfer tax. In BC it is 1% on the first $200,000, 2% up to $2,000,000 and 3% up to $3,000,000, with an additional 2% on residential value above $3,000,000. The newly built home exemption only applies up to $1,150,000.
Legal fees, a home inspection and the appraisal your lender will require. Then property tax and utility adjustments on completion day.
A worked example: $2,000,000 new duplex
| Item | Amount |
|---|---|
| Purchase price | $2,000,000 |
| GST at 5% | $100,000 |
| Property transfer tax | $38,000 |
| Legal fees and disbursements | about $2,000 |
| Home inspection | about $600 |
| Appraisal | about $400 |
| All in | about $2,141,000 |
That is more than $140,000 above the number on the listing. Every property differs, but this is the real shape of it.
Your bank sets your ceiling, not the market
Get a proper pre approval before you are in an offer situation. Not an app estimate. A real conversation with your lender or mortgage broker about what they will approve.
Most pre approvals hold a rate for roughly 90 to 120 days. If your search runs longer, that approval can quietly expire while you are still shopping. Keep it current.
The market does not decide what you offer. Your full budget does, confirmed and current, before you are standing in a bidding situation trying to guess.
Work out your real number
The byfelix. closing cost calculator runs these numbers on any price in under a minute. Try it here.
Common questions
- Do you pay GST on a new duplex in BC?
Yes, in most cases. GST at 5% applies to new and substantially renovated homes. Confirm in the contract whether the price includes GST.
- How much is property transfer tax on a $2 million home in BC?
$38,000. That is 1% on the first $200,000 and 2% on the next $1,800,000.
- Does the first time buyer GST rebate apply to a $2 million home?
No. The First Time Home Buyers' GST Rebate is full up to $1,000,000 and phases out entirely at $1,500,000.
- How long does a mortgage pre approval last?
Usually 90 to 120 days, depending on the lender. Renew it if your search runs longer.