Closing costs are the additional expenses buyers pay when completing a real estate purchase. In Toronto, these costs typically range from about 1.5% to 4% of the purchase price.
The largest closing cost for most buyers is land transfer tax.
When buying property in Toronto, buyers pay two land transfer taxes: the Ontario Land Transfer Tax and the Toronto Municipal Land Transfer Tax. Both are calculated on a sliding scale based on the purchase price.
First-time buyers may qualify for rebates that reduce part of these taxes.
Other common closing costs include legal fees, which typically range from $1,500 to $2,500, depending on the lawyer and complexity of the transaction.
Buyers must also purchase title insurance, which protects against issues related to the property’s ownership or title. This usually costs $300 to $500.
If the property is a condominium, buyers will also pay for a status certificate and a legal review of the document, which confirms the financial and legal standing of the condominium corporation.
Another common closing cost is adjustments. If the seller has prepaid expenses such as property taxes, utilities, or maintenance fees beyond the closing date, the buyer reimburses the seller for the unused portion.
Additional expenses may include mortgage appraisal fees, home inspections, moving costs, and utility setup.
Because these costs vary depending on the property and purchase price, buyers typically budget a percentage of the purchase price rather than a fixed amount.