Editor's note, October 6, 2026: this article was reviewed and rewritten in our accuracy check. An earlier version contained fee ranges and worked examples we could not source; they have been removed or replaced with figures from the sources listed at the end of the article.
Closing costs are the cash you need on closing day on top of your down payment. CMHC suggests budgeting 1.5% to 4% of the purchase price. In Ontario, where most of that is land transfer tax, you can estimate the largest items exactly. Lenders generally want to see that you have the closing costs in hand when they approve the mortgage.
1. Land transfer tax (the big one)
Ontario charges land transfer tax on every purchase, on a graduated scale: 0.5% up to $55,000, 1% up to $250,000, 1.5% up to $400,000, 2% up to $2,000,000, 2.5% above $2,000,000. In the City of Toronto you also pay the municipal land transfer tax, which uses the same scale up to $3 million and higher rates above that (from April 1, 2026).
- $800,000 home outside Toronto: $12,475.
- $800,000 home in Toronto: $12,475 provincial + $12,475 municipal = $24,950.
- Same Toronto home, eligible first-time buyer: $16,475 after the refunds of up to $4,000 (Ontario) and $4,475 (Toronto).
Foreign buyers also pay Ontario's 25% Non-Resident Speculation Tax, and in Toronto the 10% municipal non-resident speculation tax.
2. Legal fees and disbursements
Your real estate lawyer reviews the agreement, searches title, registers the transfer and mortgage, pays the land transfer tax and prepares the statement of adjustments. Fees vary by lawyer and by deal, and disbursements (searches, registration, courier) and HST are added on top. Ask two or three lawyers for a written all-in quote before you firm up your offer.
3. Title insurance
Most lenders require title insurance or an equivalent; your lawyer arranges it and the premium appears on the statement of account.
4. Mortgage default insurance and the PST on it
With less than 20% down, the insurance premium is added to your mortgage, but Ontario's 8% sales tax on the premium cannot be financed and is paid in cash at closing. Example: $800,000 with the minimum $55,000 down borrows $745,000; at CMHC's 4% premium that is $29,800 added to the loan and $2,384 of PST due at closing.
5. Adjustments
If the seller prepaid property tax, utilities or condo fees for a period after closing, you reimburse them for your share. These appear on the statement of adjustments your lawyer sends a few days before closing. In a condo, check the status certificate for any arrears or special assessments.
6. New homes: HST and the rebates
Resale homes are generally sold without HST. On a new home, the 13% HST is usually built into the price with rebates assigned to the builder. Check what the price assumes: the federal first-time buyer GST rebate (up to $50,000, federal part only), Ontario's rebates on the 8% provincial part, and, for agreements signed from April 1, 2026 to March 31, 2027, the Ontario enhanced new housing rebate (up to $80,000). If you don't qualify, the builder can usually charge the rebate back to you on closing. New builds also carry closing adjustments set out in the agreement; ask for the list before you sign.
7. Before closing
- Home inspection, if you include one.
- Appraisal, if your lender charges for it.
- Home insurance: your lender needs proof before it funds.
- Moving and utility connection costs.
Frequently asked questions
When do I pay?
Your lawyer collects the balance a few days before closing, by certified funds or wire. Your deposit is paid when the offer is accepted and is credited toward the price.
Can I add closing costs to my mortgage?
Generally no. The CMHC premium can be added to an insured mortgage, but the PST on it, the land transfer tax and legal fees are paid from your own funds.
Do I pay HST on a resale home?
Generally no, unless it was substantially renovated. HST does apply to legal and other service fees.
Estimate your own numbers with our calculators, or ask Zara, Summitly's AI virtual agent.
