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Prepare for Closing Costs When Buying a House or Condo in Toronto

real estate closing costs

Are you gearing up to make a buying a home in Toronto? Don’t let closing costs catch you off guard. Being well-informed can empower you to budget effectively and navigate the buying process with confidence. In this article, we’ll shed light on the crucial closing costs associated with buying a home. Our commitment to informative content means you’re getting insights from Gagan.

Understanding Closing Costs

Closing costs are an integral part of the home buying process. To ensure a smooth experience, it’s essential to grasp the expenses you might encounter. Here’s a breakdown of the common and significant closing costs you need to be aware of:

Closing Costs Before Closing

1. Deposit: Typically around 5% of the purchase price, payable within 24 hours of your offer’s acceptance.
2. Property Appraisal: Usually covered by the lender, costing between $400 to $500.
3. Home Inspection: A payment of $400 to $700 to the inspection company at the time of inspection.

Closing Costs On Closing

1. Balance of Purchase Price: The difference between the purchase price and your initial deposit, primarily funded by your mortgage.
2. Legal Fees: These vary with the purchase price and are approximately $1,800 for a $500,000 purchase.
3. Title Insurance: Often included in legal fees, around $250 to $400.
4. Mortgage Broker Commission: If applicable, generally covered by the lender.
5. Property Survey: Costing between $1,000 to $2,000, required if needed.
6. Land Transfer Taxes: Including Ontario Land Transfer Tax and Toronto Land Transfer Tax, calculated based on purchase price.
7. Property Tax Adjustment: Reimbursement to the seller for property taxes paid beyond the closing date.
8. HST: Mainly relevant for new construction condos and houses.
9. Tarion Warranty Fees: Applicable to new construction properties, estimate available through our provided link.
10. Provincial Sales Tax: Only for chattels purchased from the vendor, amount varies.
11. Adjustments for Utilities/Condo Fees: Reimbursement to the seller for prepaid utilities and more.
12. CMHC Insurance Premium: If your down payment is less than 20%, estimate the insurance premium through our provided link.

Closing Costs After Closing

1. Moving Expenses: Typically around $1,000 or more.
2. Utility Connection Charges: Variable based on services needed.
3. Redecorating and Renovating Costs:Varies depending on your preferences.
4. Immediate Repair and Maintenance Costs: Budget for unexpected post-move expenses.


Closing costs are a reality of the home buying process, and understanding them is essential for a successful purchase. By familiarizing yourself with these expenses, you can prepare your budget effectively and navigate your property acquisition journey confidently. Don’t let closing costs be a surprise—empower yourself with knowledge and make your Toronto real estate purchase a smooth endeavor.

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Gagan Verma - top toronto realtor