My journey into real estate began naturally. I’ve always loved exploring Toronto and its diverse neighborhoods — discovering the character, charm, and hidden gems that make each one unique.
Real Estate Closing Costs in Toronto
Real Estate Closing Costs in Toronto: What They Are and How to Calculate Them
Buying a home in Toronto or the GTA is an exciting milestone — but many buyers are surprised by the extra expenses that appear right before closing. These are known as closing costs, and understanding them early can save you stress and thousands of dollars. In this guide, Farid Yari, Toronto Real Estate Advisor, explains what these costs include and how to plan for them confidently.
What Are Closing Costs?
Closing costs are the final fees you pay when the property officially transfers from the seller to you. They include legal, government, and lender charges that typically range between 1.5% and 4% of the purchase price. Having a clear estimate helps you budget accurately and avoid surprises on closing day.
Common Real Estate Closing Costs in Toronto
1. Land Transfer Tax (LTT)
In Ontario, buyers pay both a provincial and a municipal (Toronto) land transfer tax. For example, on an $800,000 home, the combined amount is around $24,950. First-time buyers may qualify for rebates up to $8,475 — something Farid Yari Real Estate helps clients apply for.
2. Legal Fees and Disbursements
Hiring a real estate lawyer is essential. Expect to pay between $1,200 and $2,000 for title transfer, mortgage registration, and paperwork.
3. Title Insurance
This one-time cost ($250–$500) protects you from ownership disputes or errors in property records.
4. Home Inspection
Even if optional, inspections are highly recommended. The average cost is $400–$700, and it can save you from future repair surprises.
5. Appraisal Fee
Most lenders require an appraisal before approving a mortgage. Typical cost: $300–$500.
6. Adjustments and Prepaid Expenses
These cover pre-paid taxes or maintenance fees already paid by the seller. Your lawyer will calculate your fair share during closing.
7. CMHC Insurance Premium (for less than 20% down payment)
If your down payment is under 20%, mortgage default insurance applies. The premium is added to your mortgage, but Ontario’s 8% PST must be paid upfront.
Sample Closing Cost Estimate
| Cost Item | Estimated Amount (CAD) |
|---|---|
| Land Transfer Taxes (Provincial + Toronto) | $24,950 |
| Legal Fees + Disbursements | $1,800 |
| Title Insurance | $400 |
| Adjustments | $500 |
| Appraisal + Inspection | $900 |
| CMHC PST (if applicable) | $600 |
Total Estimated Closing Costs: $29,000 – $30,000 (assuming no rebate)
Farid Yari recommends budgeting around 3–4% of your home’s purchase price for all closing-related expenses.
First-Time Buyer Incentives in Toronto
- Ontario Land Transfer Tax Rebate — up to $4,000
- Toronto Land Transfer Tax Rebate — up to $4,475
- First-Time Home Buyers’ Tax Credit — up to $1,500
Together, these programs can save first-time buyers nearly $10,000. Farid Yari Real Estate assists clients in navigating all available rebates to maximize savings.
Final Thoughts from Farid Yari
Understanding closing costs in Toronto is key to making confident real estate decisions. With the right guidance, buyers can plan ahead and avoid last-minute stress. Farid Yari helps first-time and repeat buyers create personalized cost estimates and connect with trusted lawyers, lenders, and inspectors.
