What are closing costs in Ontario?

What are closing costs in Ontario?

Closing costs in Ontario typically range from 1.5% to 4% of the purchase price. This range accounts for various fees and taxes associated with property transactions in the province. According to Shaikh Law Office, “A guideline on Average Closing Costs in Ontario ranges between 1.5% to 4% of the Purchase Price” .

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Ontario Closing Costs	Value
Average Percentage of Purchase Price	1.5% to 4%
Land Transfer Tax	Varies by property value and location
Legal Fees	$1,000 to $3,000
Title Insurance	$150 to $5,000
Home Inspection Fee	$500 to $800
Appraisal Fee	$300 to $500
Property Survey	Varies (if required)
Mortgage Default Insurance	2.8% to 4% of mortgage amount (if down payment < 20%)
PST on Mortgage Default Insurance	8% (Ontario)
Registration Fees	Around $200
Estoppel Certificate (for condos)	Around $100
Lawyer Disbursements	$450
Unity Charges	$270
HST on Applicable Items	Varies
First-Time Home Buyer Rebate	Available in Ontario
Municipal Land Transfer Tax	Applies in some cities (e.g., Toronto)
Mortgage Broker Fee	Typically $0 (paid by lender)
Property Tax Adjustment	Varies based on closing date
Utility Account Setup Fees	Varies by provider
Home Insurance	Varies based on property
Moving Costs	Varies based on distance and volume
Mortgage Life Insurance	Optional, varies by provider
Status Certificate (for condos)	$100 to $200
Property Management Fees (for condos)	Varies by building
Land Survey (if required)	$1,000 to $2,000
Water Quality Test (rural properties)	$100 to $300
Septic Tank Inspection (rural properties)	$250 to $500
Well Inspection (rural properties)	$300 to $500
Mortgage Discharge Fee (for sellers)	$200 to $500
Real Estate Commission (for sellers)	Typically 5% of sale price

How is Land Transfer Tax calculated in Ontario?

Land Transfer Tax in Ontario varies by property value and location. The tax is calculated using a progressive rate structure, with higher rates applied to higher property values. Ratehub.ca states, “Land transfer taxes, ranging from 1.5 to 4% of selling price, are the legal and administrative costs you will need to pay when your house closes”.

What do legal fees typically cost for closing in Ontario?

Legal fees for closing in Ontario typically range from $1,000 to $3,000. This cost covers the essential services provided by a real estate lawyer during the transaction process. According to Baron Alloway of Alloway Property Group notes, Most lawyers charge between $1200 and $2400 for a standard residential purchase.

How much does title insurance cost in Ontario?

Title insurance in Ontario typically costs between $150 to $5,000. The wide range in cost is due to factors such as property value and location. WOWA.ca explains, “Closing costs are one-time fees that the real estate buyers must pay when they decide to purchase a property in Canada. These costs include, but are not limited to: land or property transfer taxes, lawyer fees and inspection fees” (WOWA.ca, “Home Closing Cost Calculator 2024“).

What’s the typical home inspection fee in Ontario?

The typical home inspection fee in Ontario ranges from $500 to $800. This cost covers a comprehensive assessment of the property’s condition by a professional inspector. Shaikh Law Office states, “Home Inspection Fees: $500 to $800 Optional costs but strongly recommended to have it done” (Shaikh Law Office, “Closing Costs Ontario you MUST KNOW before Buying or Selling“). 

How much is an appraisal fee in Ontario?

An appraisal fee in Ontario typically costs between $300 to $500. This fee covers the professional assessment of the property’s value, often required by lenders. According to Shaikh Law Office, “Appraisal Fees: $300 to $500 some lenders would prefer to appraise the home before granting the loan. (optional)” 

How much are registration fees in Ontario?

Registration fees in Ontario are typically around $200. These fees cover the cost of officially registering property ownership changes with the government. Alloway Property Group notes, “The average total for all registration fees can be around $200 but you should contact your lawyer for a more accurate estimate”

What’s the cost of an estoppel certificate for condos in Ontario?

The cost of an estoppel (aka. status) certificate for condos in Ontario is typically just above $100. This certificate provides important financial and legal information about the condominium corporation. Alloway Property Group states, “The Fee for a Status Certificate in Ontario is usually $100” 

How much are lawyer disbursements in Ontario?

Lawyer disbursements in Ontario are typically around $450. These costs cover various expenses incurred by the lawyer during the transaction process. Shaikh Law Office includes “Disbursements $450.00″ in their closing costs breakdown”.

Is HST applied to closing costs in Ontario?

HST is applied to some closing costs in Ontario, but it varies depending on the specific item. Certain professional services and fees may be subject to HST, while others are exempt. Seif Law Firm mentions, “Closing costs are an important part of any real estate transaction, whether it’s buying a house or selling it” (Seif Law Firm, “Closing cost calculator Ontario & Toronto“).

Is there a first-time home buyer rebate in Ontario?

Yes, there is a first-time home buyer rebate available in Ontario. This rebate can significantly reduce the land transfer tax for eligible buyers. According to the Ontario Ministry of Finance, “First-time purchasers of eligible homes may receive a refund of land transfer tax, up to a maximum of $4,000” (Ontario Ministry of Finance, “Land Transfer Tax Refunds for First-Time Homebuyers“).

Do some Ontario cities have additional land transfer tax?

Yes, some Ontario cities have additional land transfer tax, most notably Toronto. This municipal land transfer tax is in addition to the provincial tax. The City of Toronto states, “The Municipal Land Transfer Tax (MLTT) is a tax on the acquisition of an interest in land in the City of Toronto” (City of Toronto, “Municipal Land Transfer Tax“).

What’s the typical mortgage broker fee in Ontario?

The typical mortgage broker fee in Ontario is $0 for the borrower, as it’s usually paid by the lender. Mortgage brokers generally receive compensation from the lenders they work with. According to Tim Bennett of Ratehub.ca explains, “Mortgage brokers are typically paid by the lender, and not by you, the borrower” (Ratehub.ca, “How do mortgage brokers get paid?”).

How is property tax adjustment handled in Ontario closings?

Property tax adjustment in Ontario closings varies based on the closing date and the current tax payment status. The buyer typically reimburses the seller for any prepaid property taxes, this is handled by the lawyer at closing. Axess Law states, “Property tax adjustments are calculated based on the closing date and whether property taxes have been paid in advance” (Axess Law, “The Additional Expenses to Expect as a Home Buyer“).

Are there utility account setup fees in Ontario?

Utility account setup fees in Ontario vary by provider and may apply when establishing new accounts. These fees can cover electricity, water, gas, and other essential services. Energyrates.ca advises, “Utility companies usually charge a setup fee for setting up electricity or natural gas delivery. If your old utility provides services in your new location, they may waive this fee. ” (Energyrates.ca, “How to Set Up Your Utility Service When You Move in Ontario“). 

Is home insurance required for closing in Ontario?

Home insurance is typically required for closing in Ontario, especially if you have a mortgage. While not legally mandated, most lenders require it as a condition of the mortgage. Sarita Harbour of Manulife Bank notes, “If your down payment is less than 20% of a home’s purchase price, you need mortgage loan insurance, also referred to as mortgage insurance or mortgage default insurance.” (Manulife Bank, “Financing your home: how does mortgage insurance work?”).

Are moving costs considered part of closing costs in Ontario?

Moving costs are not typically considered part of closing costs in Ontario, but they are an important expense to budget for when buying a home. These costs can vary significantly based on distance and volume of items. The Canadian Association of Movers advises, “The cost of moving varies greatly depending on the distance of the move and the amount of belongings being moved” (Canadian Association of Movers, “Budgeting for Your Move“). 

Is mortgage life insurance mandatory in Ontario?

Mortgage life insurance is not mandatory in Ontario, but it is an optional product that some homebuyers choose. This insurance pays off your mortgage in the event of your death. The Financial Consumer Agency of Canada states, “Mortgage life insurance is optional. Your lender can’t deny you a mortgage if you don’t get mortgage life insurance” (FCAC, “Mortgage life insurance“). 

What’s the cost of a status certificate for condos in Ontario?

The cost of a status certificate for condos in Ontario is around $100, as per the Condominium Act.  This document provides important information about the condominium corporation’s financial and legal status. The Condominium Authority of Ontario notes, “The maximum fee that can be charged for a status certificate is $100” (CAO, “Status Certificates“).

Are property management fees part of closing costs in Ontario?

Property management fees are not typically considered part of closing costs in Ontario, but they can be an ongoing expense for condominium owners. These fees cover the management and maintenance of common areas in a condo building. According to the Ontario Condominium Act, “Condominium corporations are responsible for managing the property and common elements, and owners pay fees to cover these costs” (Government of Ontario, “Condominium Act, 1998”).

How much does a land survey cost in Ontario if required?

A land survey in Ontario, if required, typically costs between $1,000 to $2,000. This cost can vary based on the complexity of the survey and the size of the property. The Association of Ontario Land Surveyors states, “The cost of a land survey can vary widely based on the specifics of the property and the survey required” (Association of Ontario Land Surveyors, “Land Surveying Costs“).

What’s the cost of a water quality test for rural properties in Ontario?

The cost of a water quality test for rural properties in Ontario usually ranges from $100 to $300. When using a Realtor for a property with well (or any type of non municipal) water they will complete a water test as a condition of the sale and have it analyzed, for free, by the local Ontario Health Unit. If a mortgage is being used for the purchase this will be a required condition of sale. This test is crucial for assessing the safety of drinking water, especially for homes relying on private wells. The Ontario Ministry of the Environment, Conservation and Parks advises, “Testing your well water is essential to ensure its safety, and costs can vary depending on the tests performed” (Ontario Ministry of the Environment, Conservation and Parks, “Well Water Testing“).

How much is a septic tank inspection in rural Ontario?

A septic tank inspection in rural Ontario typically costs between $250 to $500. This inspection is essential for assessing the condition and functionality of the septic system. The Ontario Ministry of Municipal Affairs and Housing states, “Regular inspections of septic systems are important for ensuring they function properly and do not pose a risk to the environment”

What’s the cost of a well inspection in rural Ontario?

The cost of a well inspection in rural Ontario generally ranges from $300 to $500. This inspection evaluates the well’s structure and water quality, ensuring it meets safety standards. The Ontario Ministry of the Environment, Conservation and Parks emphasizes the importance of regular inspections, stating, “Well inspections help ensure the safety and quality of drinking water”

What’s the mortgage discharge fee for sellers in Ontario?

The mortgage discharge fee for sellers in Ontario typically ranges from $200 to $500. This fee is charged by the lender to release the mortgage once the property is sold. According to the Canadian Mortgage and Housing Corporation, “When you sell your home, you may have to pay a discharge fee to your lender to remove the mortgage from the property title” 

How much is real estate commission for sellers in Ontario?

The real estate commission for sellers in Ontario is typically around 5% of the sale price. This commission is  split between the seller’s Realtor and the buyer Realtor, which is then split between each Realtor and their Brokerage. WOWA.ca states, “In Ontario, the standard real estate agent commission is 5% of the property price plus HST, but in practice, the commission can range anywhere from 3.5% to 5%. The total commission will be divided between the buyer and seller agents, where the buyer’s portion is typically fixed at 2.5%.” 

To learn more about buying or selling your property or to start the process give us a call and our team will be happy to help you 705-331-3341.