One of the most common questions all buyers have is "How much money do I actually need to buy a home?" So, let’s break it down: what does it cost to buy a $400,000 home?

Most people immediately think of the down payment, but that's really only one piece of the puzzle. There are several other costs to consider before you get the keys, and understanding them ahead of time can make the process feel much less overwhelming. The last thing anyone wants is to be surprised by unexpected costs during an already exciting milestone.

Please note that the figures below are estimates for Saskatchewan and are intended for educational purposes. Your actual costs will vary depending on your financial position, mortgage, lender, possession date, and the property you purchase.

The Down Payment: $20,000 (or greater)

Your down payment is the amount you contribute toward the purchase price before your mortgage begins. It plays an important role in your financing, affecting how much you borrow and whether mortgage default insurance is required. For a $400,000 home, here's what those numbers look like:

A larger down payment reduces the amount you need to borrow, which can lower your monthly mortgage payment and the amount of interest you'll pay over the life of your mortgage. If you're able to put 20% or more down, you'll also avoid paying mortgage default insurance altogether. With this said, 5% is the most common downpayment in our market for first time home buyers.

Mortgage Default Insurance (added to your mortgage)

However, if your down payment is less than 20%, your mortgage must include mortgage default insurance. This protects the lender if a borrower defaults on their mortgage. The premium isn't usually paid upfront, instead, it's added to your mortgage and paid over the lifespan of your mortgage.

For a $400,000 purchase, the premium generally looks something like this:

PST on Mortgage Insurance: $900

In Saskatchewan, Provincial Sales Tax (PST) applies to the mortgage insurance premium. Unlike the premium itself, the PST cannot be rolled into your mortgage. Instead, it must be paid in cash as part of your closing costs.

For many buyers purchasing a $400,000 home with the minimum down payment (5%), this can amount to a $912 cost (approx.) at the lawyers. If you are putting a greater downpayment than 5%, the PST will be calculated based on the mortgage insurance premium. It's one of the most commonly overlooked expenses when budgeting for a home purchase.

Home + Sewer Inspection: $700-$1,000

A home inspection is one of the best investments you'll make during the buying process. While not mandatory, I strongly recommend having one completed whenever possible.

A professional home inspection generally costs between $450 and $700. It provides valuable insight into the homes condition and can uncover maintenance items or larger concerns before you finalize your purchase. Sometimes an inspection simply provides peace of mind. Other times, it can save you thousands of dollars in unexpected repairs.

Remember that sometimes a home inspection is just the starting point. Depending on the property, your home inspector may also recommend additional inspections to further evaluate specific areas of the home. While these aren't always required, it's a good idea to leave a little extra room in your budget should additional inspections be recommended.

Title Insurance: $250-$400

Title insurance is a one-time policy purchased during the closing process that helps protect you against certain issues related to the property's title. Depending on the policy, it may provide coverage for things like title fraud, errors in public records, survey or boundary issues, unpaid liens that weren't discovered before closing, and other title-related defects. The cost typically ranges from $250 to $400 and is usually arranged by your lawyer as part of your closing costs.

Also, in many cases, lenders will require title insurance as a condition of financing, so it is generally not an optional expense for buyers using a mortgage.

While it's not the largest expense you'll encounter, it provides valuable peace of mind and is a standard part of many real estate transactions.

Legal Fees & Closing Costs: $4000-$5000

Your lawyer plays an important role in your purchase by preparing the legal documents, transferring title, and ensuring everything is completed correctly before possession.

Some of the most common closing costs include:

• Lawyer Fees & Disbursements: Approximately $1,000–1,800

• Land Titles Registration: Approximately $1,800–2,000

• PST on Mortgage Insurance: Approximately $900 (if your down payment is less than 20%)

For many buyers, it's wise to budget approximately $4,000–$5,000 for closing costs, although the total can vary depending on the property and your transaction.

Before closing, your lawyer will provide a Statement of Adjustments outlining exactly what you'll need to bring on possession day, including your remaining down payment, closing costs, and any adjustments, such as property taxes.

Property Tax Adjustments (TBD)

This is another cost that surprises many first-time buyers. If the seller has already paid property taxes beyond your possession date, you'll reimburse them for your portion at closing.

The amount will depend on:

• Your possession date

• Whether the seller has already paid property taxes

• The property's annual taxes

• Whether the seller pays their taxes annually or through the City's TIPPS (Tax Instalment Payment Plan)

Some property tax adjustments are only a few hundred dollars, while others may be significantly more. Your lawyer will calculate the exact amount as part of your Statement of Adjustments, so you'll know exactly what to expect before closing.

Don't Forget These Additional Costs

Depending on your situation, you may also want to budget for:

• Moving expenses

• Utility connection fees

• Home insurance

• Changing the locks

• Professional cleaning

• Paint or small repairs before moving in

• Window coverings or furniture

• Appliances if they aren't included (more common for a new build)

These expenses will vary from buyer to buyer, but it's always a good idea to keep a little extra money set aside for those first few weeks in your new home.

So, Let’s Recap How Much Cash You’ll Actually Need

For a $400,000 home with a 5% down payment, a realistic estimate might look like this:

* Applies when your down payment is less than 20%.

Estimated Cash Required: $26,000-$30,000

For many buyers, it's wise to have approximately $26,000 to $30,000+ available before purchasing a $400,000 home. Every transaction is unique, so your exact costs will depend on the property, your lender, mortgage, and possession date.

Final Thoughts

Buying a home involves more than simply saving for your down payment. Knowing what to expect ahead of time allows you to budget confidently, avoid surprises, and focus on the exciting part: finding the right home.

If you're wondering what these numbers would look like for your budget, whether you're purchasing a $300,000 condo, a $500,000 family home, a luxury property, or something in between, it’s my pleasure to help. Every buyer's situation is different, and a personalized cost breakdown can help you understand exactly what to expect before you start shopping.

Thinking about buying a home? Let's have coffee + a conversation. I'd love to help you create a plan that fits your goals and your budget.