PEI has a straightforward 1% real property transfer tax and relatively low closing costs. The province has unique land ownership restrictions that can affect certain purchases.
PEI real property transfer tax
| Rate | Basis |
|---|---|
| 1% | Greater of purchase price or assessed value |
Transfer tax examples
| Purchase Price | Transfer Tax |
|---|---|
| $250,000 | $2,500 |
| $300,000 | $3,000 |
| $400,000 | $4,000 |
| $500,000 | $5,000 |
| $600,000 | $6,000 |
Complete PEI closing cost estimate
Scenario 1: $400,000 home in Charlottetown (first-time buyer, 5% down)
| Cost | Amount |
|---|---|
| Real property transfer tax (1%) | $4,000 |
| Legal fees | $1,700 |
| Title insurance | $350 |
| Home inspection | $500 |
| Property tax adjustment | $1,100 |
| PST on CMHC | $0 (no PST on insurance in PEI) |
| Home insurance | $1,500 |
| Moving costs | $1,800 |
| Total closing costs | $10,950 |
Scenario 2: $350,000 home in Summerside (repeat buyer, 20% down)
| Cost | Amount |
|---|---|
| Real property transfer tax (1%) | $3,500 |
| Legal fees | $1,500 |
| Title insurance | $300 |
| Home inspection | $450 |
| Property tax adjustment | $900 |
| Home insurance | $1,300 |
| Moving costs | $1,500 |
| Total closing costs | $9,450 |
PEI-specific considerations
Lands Protection Act
PEI restricts land ownership to protect the island’s agricultural character:
- Non-residents: Can own up to 5 acres and 165 feet of shore frontage without approval. Larger purchases require a permit from the Island Regulatory and Appeals Commission.
- Corporations: Aggregate corporate land holdings are limited to 3,000 acres.
- Typical residential: Standard homes in Charlottetown and Summerside are unaffected by these rules.
Well and septic
Many PEI properties outside of Charlottetown and Summerside rely on well water and septic systems:
- Well water testing: $50–$100
- Septic inspection: $200–$400
Insurance considerations
PEI properties, especially coastal ones, may face higher insurance premiums due to storm surge and flooding risk. Get insurance quotes before making an offer on waterfront properties.
Related pages
- Closing Cost Calculator — All Provinces
- What Are Closing Costs in Canada?
- CMHC Insurance Calculator
- How Much Do I Need for a Down Payment?
PEI closing costs vs other Atlantic provinces
| Province | Closing costs on $350K home | Transfer tax / fee |
|---|---|---|
| Newfoundland | $6,500–$8,500 | ~$2,716 (registration fees) |
| New Brunswick | $8,500–$11,000 | $3,500 (1% LTT on assessed) |
| PEI | $9,000–$12,000 | $3,500 (1% on purchase price) |
| Nova Scotia (Halifax) | $11,000–$14,500 | $5,250 (1.5% DTT) |
First-time buyer programs in PEI
PEI has no provincial LTT exemption for first-time buyers (the LTT calculator page’s exemption under $200K applies to the standalone LTT, but at today’s prices most homes exceed that threshold). Federal programs apply:
| Program | Benefit |
|---|---|
| Federal First-Time Home Buyers Tax Credit | Up to $1,500 federal tax refund |
| FHSA (First Home Savings Account) | Up to $40,000 tax-free savings |
| Home Buyers’ Plan (HBP) | Withdraw up to $60,000 from RRSP tax-free |
Non-resident buyers: extra considerations
PEI’s Lands Protection Act creates unique due diligence requirements for non-residents and corporations:
| Buyer Type | Restriction | Approval Required? |
|---|---|---|
| PEI resident | None | No |
| Canadian non-resident | Over 5 acres or 165 ft shore frontage | Yes — IRAC approval |
| Corporation | Aggregate limit of 3,000 acres | Yes above limit |
| Foreign national | Same as Canadian non-resident | Yes |
Standard residential properties in Charlottetown and Summerside are almost never affected. This primarily applies to large rural lots and waterfront.
Budgeting rule of thumb for PEI
| Purchase Price | Estimated Total Closing Costs | % of Purchase Price |
|---|---|---|
| $250,000 | $7,500–$9,500 | 3.0%–3.8% |
| $350,000 | $9,000–$12,000 | 2.6%–3.4% |
| $450,000 | $11,000–$14,500 | 2.4%–3.2% |
| $600,000 | $13,500–$18,000 | 2.3%–3.0% |
Budget 2.5%–3.5% of the purchase price for closing costs on a typical PEI home purchase.
PEI real estate market context
PEI has one of Canada’s smallest housing markets, with Charlottetown and Summerside accounting for most activity. The province has experienced significant price growth since 2020 due to immigration and internal migration from higher-cost provinces. Average detached prices in Charlottetown now range from $350,000–$500,000. The island’s finite land and Lands Protection Act create natural supply constraints, especially for rural and waterfront properties.