Closing Costs

Home Buying Closing Costs

Closing a real estate transaction can come with a lot of extra fees. These closing costs can add up to thousands of dollars.  That’s why it’s very important for buyers to understand what to expect at the start of their property search and to budget accordingly.  This list summarizes some of the more common closing costs but is not exhaustive.

Land Transfer Tax

According to the Ontario Ministry of Revenue,  if you buy land or an interest in land in Ontario, you must pay Ontario’s land transfer tax, whether or not the transfer is registered at one of Ontario’s land registry office.  Land includes any buildings, buildings to be constructed, and fixtures (such as light fixtures, built-in appliances and cabinetry).  Land transfer tax is normally based on the amount paid for the land, in addition to the amount remaining on any mortgage or debt assumed as part of the arrangement to buy the land.

The tax rate has not changed since June 1, 1989.

  • 0.5% of the value of consideration for the transfer up to and including $55,000,
  • 1% of the value of the consideration which exceeds $55,000 up to and including $250,000, and
  • 1.5% of the value of the consideration which exceeds $250,000, and
  • 2% of the amount by which the value of the consideration exceeds $400,000 for land that contains at least one and not more than two single family residences

Toronto Land Transfer Tax is in addition to the basic Land Transfer Tax. 

Property Taxes

In many cases a home buyer can include their property taxes in their monthly mortgage payments.  However, if a buyer does not or cannot include taxes in their mortgage, the fee must be paid in addition to their mortgage.  Your realtor can provide accurate taxation information depending on the property of interest.

Legal Fees

Real estate lawyers provide assistance in many aspect of a real estate transaction including reviewing contracts and status certificates, performing title searches, registering the deed and mortgage and delivering closing funds and financial disbursements.  While legal services can vary in size and scope, a typical lawyer will charge approximately $2,00 for closing costs. In more complicated commercial transactions, fees can be significantly higher. 

Moving Costs

Hiring a professional mover can typically cost anywhere from $250 for a simple one bedroom move to $3,000 or more to move the contents of a large house.

Home Insurance

Typically, your mortgage lender will require proof of home insurance which covers the replacement value of your home and the contents inside.  This can also add hundreds of dollars to your annual home ownership expense.

Maintenance Fees

If you purchase a condominium, you’ll need to pay monthly maintenance fees that go toward repair and maintenance of the common elements within your building.  The cost of monthly maintenance fees can vary greatly depending on the building (does it have a pool?  Is it older and in need of more repair, etc).  Typically it can be between $250 – $800 per month.

Utility Fees

When you first move into your new home you’ll need to hook up your phone, internet and television.  Utility providers can charge upfront installation fees, typically $50 – $150 each.

Appraisal Fees

If your mortgage lender requires an appraisal of your home before granting a mortgage they could make you responsible for paying the $200-$500 upfront fee. Again this figure can be significantly more when dealing with commercial properties. 

Julie Osland

Julie Osland

CENTURY 21 Regal Realty Inc., Brokerage*
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