Updated 2026-11-04
Beyond the down payment, buyers need cash for closing costs. A common rule of thumb is 1.5% to 4% of the purchase price, depending mostly on whether the home is in the City of Toronto.
Land transfer tax
This is the largest closing cost. Every Ontario buyer pays the provincial land transfer tax; buyers in the City of Toronto also pay the municipal land transfer tax. On a $1,000,000 home that is about $16,475 outside Toronto and $32,950 inside Toronto, before any first-time buyer rebate.
First-time buyers can get up to $4,000 back from Ontario and up to $4,475 from Toronto. Try the land transfer tax calculator.
Legal fees and disbursements
Your real estate lawyer handles the title search, mortgage documents, registration and funds. Fees vary by firm and by how complex the deal is, so ask for a written quote that includes disbursements and HST.
Title insurance
Protects you against title problems such as fraud, survey issues or unpaid work orders. Usually a one-time premium of a few hundred dollars, arranged by your lawyer.
Home inspection and appraisal
A home inspection usually costs a few hundred dollars and is money well spent on a resale house. Some lenders also require an appraisal; ask whether your lender covers it.
Sales tax on mortgage default insurance
If your down payment is under 20%, the mortgage insurance premium can be added to your mortgage, but Ontario's 8% sales tax on that premium cannot. You pay it in cash at closing. For example, a $26,000 premium means $2,080 in tax.
Adjustments
If the seller prepaid property tax, condo fees or utilities past the closing date, you reimburse them. Your lawyer's statement of adjustments lists each item.
Other costs
- Home insurance (required by your lender)
- Moving, utility hook-ups and immediate repairs
- For new construction: review the adjustments section of the builder's agreement, which can add utility connection fees and other charges