Closing costs on an Ontario home in 2026 typically run 1.5-4% of the purchase price for resale homes and 4-6% for pre-construction, with land transfer tax (LTT) being the single largest line item. On an $850,000 Mississauga home, expect $25,000-$35,000 in total closing costs; on a $1.4M Oakville detached, expect $50,000-$65,000. Toronto buyers pay roughly double the LTT of buyers in the 905. Want a precise estimate for a specific property? Start with a free instant home valuation, then Ask Zara to itemize your closing costs.
Land Transfer Tax — by far the biggest line
Land Transfer Tax is the biggest closing cost for nearly every Ontario buyer outside of a small minority of first-time buyers benefiting from full refunds. Ontario's provincial LTT uses a graduated scale: 0.5% on the first $55,000, 1.0% on $55,001-$250,000, 1.5% on $250,001-$400,000, 2.0% on $400,001-$2,000,000, and 2.5% above $2 million. On an $850,000 home, that calculates to $13,475 in provincial LTT alone.
If your property is within the City of Toronto, you pay a second Municipal LTT on top with similar tiers — effectively doubling the LTT bill, plus extra luxury tiers introduced in 2024 that scale aggressively over $3 million. A $1.2M Leslieville semi pays roughly $20,475 provincial + $20,475 municipal = $40,950 in total LTT. Buy the same square footage in Mississauga, Oakville, or Vaughan and you save the municipal portion entirely.
First-time-buyer LTT refunds
- Ontario LTT refund: up to $4,000 (fully eliminates LTT on homes up to ~$368,000).
- Toronto Municipal LTT refund: up to $4,475.
- Combined Toronto first-time refund: up to $8,475 stacked.
Legal fees and disbursements — $1,500-$3,500
Every Ontario real estate closing requires a licensed lawyer. Standard legal fees for a typical resale purchase in 2026 run $1,200-$2,000, with disbursements (title insurance, software/Teraview fees, title searches, registration costs, courier) adding another $1,000-$1,500. Title insurance is mandatory in practice (your lender requires it) and typically costs $300-$500 from providers like FCT, Stewart Title, or Chicago Title.
Pre-construction closings cost more because the builder's lawyer often requires reciprocal undertakings, additional document review, and condominium status certificate review. Budget $2,500-$3,500 in legal fees for a pre-construction Toronto condo closing. Always ask for an itemized written quote before retaining the firm — quotes that say "plus disbursements" without a cap can balloon to $4,000+.
What your lawyer actually does
- Reviews the APS, title search, and zoning compliance.
- Drafts and registers the transfer through Teraview.
- Calculates and remits the LTT plus first-time-buyer refunds.
- Handles deposit, mortgage funding, and adjustments at closing.
- Provides the Statement of Adjustments showing every prorated cost.
Mortgage-related closing costs
If you're putting less than 20% down, CMHC, Sagen, or Canada Guaranty default insurance is mandatory and the premium gets added to your mortgage principal (so it's amortized over the term, not paid at closing). However, the provincial sales tax on the insurance premium — 8% — is payable upfront at closing. On a $700,000 mortgage with 10% down, the insurance premium is roughly $20,000 and PST on it is $1,600 due on closing day.
Other mortgage closing costs include the appraisal ($350-$600, sometimes waived for AAA borrowers at major banks), mortgage broker fees on non-prime files (B-lenders and private lenders typically charge 1-2% lender fee + 1-2% broker fee), and the mortgage registration fee ($75-$95 through Teraview).
HST and the new-home rebate landscape
Resale homes do not attract HST — but new builds (pre-construction condos, freehold builds from a builder, substantially renovated homes) do. HST is 13% in Ontario, of which 5% is federal GST and 8% is provincial. The federal New Housing Rebate covers up to 36% of the federal portion on homes under $450,000, phasing to zero above. Ontario's provincial New Housing Rebate is up to $24,000 on the provincial portion, with no upper price cap.
For new-build buyers, the builder typically advertises a price "with HST included, rebate assigned to builder" — meaning the builder claims the rebate and you don't see it as a credit at closing. If you're buying to rent instead of occupy, you cannot assign the rebate and the builder will charge you the full HST at closing, then you reclaim it after closing via the New Residential Rental Property Rebate. Investor buyers must budget $24,000-$30,000 extra at closing for this gap.
Property tax, utility, and condo adjustments
Closing day always involves dozens of small prorations called adjustments. The seller has often prepaid property taxes, hydro, gas, water, and condo fees beyond the closing date — you reimburse the seller for the unused portion. On a typical $900,000 resale in Etobicoke or North York, total prorations usually add $1,500-$3,500 to your closing payment.
For condos, you'll also pay two months of common expenses upfront as required by the condominium corporation (this funds the reserve fund and operating account starting day one). On a unit with $650/month condo fees, that's $1,300 due at closing on top of everything else.
Property tax cycles to know
- Toronto: interim bills in February/March, final in June/July, fall installments — closing mid-year frequently triggers seller credits.
- Mississauga, Brampton, Oakville (Peel/Halton): similar two-stage billing.
- Ottawa (OREB): separate municipal billing schedule.
Inspection, insurance, and pre-closing soft costs
Before closing you'll likely pay for a home inspection ($450-$700 for a typical TRREB-area detached, $300-$450 for a condo) and home insurance binder (first year's premium typically $1,200-$2,500 for a freehold, $400-$700 for a condo). These aren't "closing costs" in the strict legal sense but they are real cash you need pre-closing.
Survey or Surveyor's Real Property Report — most resale buyers in Ontario do NOT need to commission one because title insurance covers the survey-related risks. If your lawyer requires one (rare), budget $1,500-$2,500.
Non-resident and luxury surcharges
If you are not a Canadian citizen or permanent resident, the Non-Resident Speculation Tax (NRST) applies at 25% of the purchase price across all of Ontario. On a $1.2M property, that's an additional $300,000 due on closing day — a number that catches international buyers off-guard. A rebate is available if you become a permanent resident within four years of closing.
The Underused Housing Tax (UHT), administered by the CRA, is 1% annually on residential property owned by non-resident non-Canadians (with significant exceptions). Even if you don't owe the tax, you may need to file annually — penalties for missing the filing start at $5,000.
The City of Toronto Vacant Home Tax (VHT) is 3% annually (raised from 1% in 2024) on properties declared vacant for more than six months in a year. Buyers closing in November and not occupying until February sometimes get caught — talk to your lawyer about timing the declaration.
Realistic closing-cost worksheets
Example 1: $750,000 resale condo in Mississauga, first-time buyer, 10% down
- Provincial LTT: $11,475 − $4,000 refund = $7,475
- Toronto MLTT: $0 (outside city)
- Legal fees + disbursements: $2,200
- CMHC PST: $1,400
- Adjustments + condo prepayments: $1,800
- Title insurance: $450
- Home inspection: $400
- Insurance first year: $550
- Total: ~$14,275 (1.9% of price)
Example 2: $1.4M resale detached in Oakville, second-time buyer, 25% down
- Provincial LTT: $25,475
- Toronto MLTT: $0
- Legal fees + disbursements: $2,400
- Adjustments: $2,800
- Title insurance + inspection + insurance: $2,200
- Total: ~$32,875 (2.3% of price)
Example 3: $1.1M pre-construction condo in downtown Toronto, end-user
- Provincial LTT: $18,475
- Toronto MLTT: $18,475
- Legal fees: $3,000
- Development levies (capped): $20,000
- Tarion enrolment + utility hookups: $4,500
- Two months CE + insurance + adjustments: $3,800
- Total: ~$68,250 (6.2% of price)
How to reduce closing costs legally
You can't avoid LTT but you can plan around it. First-time buyers should always claim both refunds. Negotiate development levy caps on pre-construction. Compare three legal quotes — fees vary widely by firm and many TRREB-area solicitors run $1,500 flat for resale closings. For new builds, consider whether end-user status (occupy yourself) versus investor status (rent it) changes the HST math — sometimes it's worth occupying for 12 months to claim the better rebate path.
For more strategies, browse our buying guides or our mortgage financing guides, which cover how to roll some costs into your mortgage versus paying cash at closing.
Frequently asked questions
When do I actually pay closing costs?
Most closing costs are paid by certified cheque or wire transfer to your real estate lawyer one to three business days before closing. Your lawyer holds the funds in trust and disburses them on closing day. The Statement of Adjustments — typically circulated 2-5 days before closing — itemizes every penny. You should review it line by line and ask questions about anything unclear. Don't wait until closing morning to find a mistake; once funds release through Teraview, corrections are difficult.
Can I roll closing costs into my mortgage?
Most closing costs cannot be financed through your standard purchase mortgage — lenders only finance up to the purchase price. However, some lenders offer "cash-back" mortgages that provide 1-5% of the loan amount as a closing-cost rebate (usually with a slightly higher rate). The math rarely works in your favour over a 5-year term — you'd typically pay $4,000-$8,000 extra in interest to receive $5,000 cash up front. Better to save the closing-cost cash separately or use your FHSA strategically.
Are closing costs negotiable?
Some are; some aren't. LTT is set by statute — not negotiable. Legal fees are highly negotiable; shop three firms. Builder closing-cost items (development levies, utility hookups, occupancy adjustments) are negotiable BEFORE you sign the APS but not after. Title insurance is competitive — your lawyer can usually quote two providers. Home inspection and appraisal are flat-rate professional services.
What's the difference between Statement of Adjustments and the Trust Ledger?
The Statement of Adjustments shows the buyer-seller settlement of the purchase price (deposit credit, tax prorations, condo fee prorations, utility prorations). The Trust Ledger from your lawyer is a separate document showing how your money flowed in and out of the trust account — deposit received from you, mortgage funds received from lender, LTT remitted, legal fees, title insurance, balance owed by you. You'll receive both before closing.
Do I owe HST on a resale home in Ontario?
Not on the property itself. Resale homes in Ontario are HST-exempt. However, HST does apply to certain services associated with closing — legal fees, real estate commissions (paid by the seller, not buyer), home inspections, moving costs. You'll see 13% HST as a line item on each invoice. If the previous owner did a "substantial renovation" within CRA's definition, that resale may be treated as new construction for HST — rare but possible.
Key takeaways
- LTT is the biggest cost. Toronto buyers pay roughly double thanks to the municipal layer.
- Budget 1.5-2% of price for resale; budget 4-6% for pre-construction.
- First-time refunds save up to $8,475 in Toronto. Claim them through your lawyer at closing.
- Pre-construction levies can be capped. Negotiate before signing — never after.
- Get three legal quotes. Fees vary 50% between firms for identical work.
- Don't forget non-resident surcharges. NRST is 25% across Ontario for foreign buyers.
