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The hidden costs of Buying and Selling Real Estate in Toronto & GTA

A simple guide to understanding what you can expect to pay when you buy or sell your Real Estate in Ontario Canada.

Plus, a BONUS at the end!

Buying Real Estate - Freehold or Condos

Lawyer Fees: Your lawyer will review all the paperwork and verify that there are no errors or omissions. The lawyer is also responsible for making any adjustments, checking the title of the property, and reviewing the status certificate for condos. The fee will vary from the lawyer’s experience and difficulty of the transactions. It can range from $1,000 - $2,000. (You can consult with our proven lawyer Alan Fenster at Fenster Law (Just mention our website and receive a discounted price.)

Title Insurance: The Title Insurance is implemented by your lawyer and it will cover you from a myriad of issues including: unknown title defects, existing liens, and title fraud (Check out for a complete Title Insurance Overview). There is a one-time premium payment for Title Insurance which is done when you purchase your home, and it will depend on the value of your property. The one-time premium will vary from $200 to $350 dollars for most residential dwellings.

Land Transfer Tax (LTT): The government will tax you on everything including your purchase of a home so be ready to pay. There is an Ontario LTT, and if you are buying in Toronto there will be an additional Toronto LTT added on top. The tax is calculated based on the purchase price of your property. For example, if your property is purchased for $500,000 you can expect to pay a $6,475 Ontario LTT and an additional $6,475 Toronto LTT (cities like Vaughan do not yet have a municipal LTT). First time home buyers do receive a rebate of $4,000 in Ontario plus a $4,475 rebate in Toronto. (Due to the progressive tax rate formula we recommend that you use our LTT Calculator to determine this cost).

HST: When you purchase a resale property (i.e. the home is not new) the HST is included in the purchase price. The rules get more complex with new homes and condos. If the new dwelling is going to be your primary residence the HST will be waved, but if you plan on renting the property you must apply for an HST rebate. The rules and regulations change very often and we cannot cover everything here. Please consult your tax professional on this issue.

Mortgage Loan Insurance: Without a 20% down payment the lender will want you to insure your mortgage. The insurance can cost you from 2.75% to 4.0% of your total mortgage amount! Most of the time the extra cost is just added on top of your mortgage (See our mortgage insurance calculator for a more in-depth breakdown). We recommend consulting one of our mortgage professionals to find the best options for you.

Last but not Least, if the previous owner Prepaid some of the Property Taxes or the Utilities your lawyer will calculate the adjustments and will facilitate a reimbursement to you or the previous owner.

Selling Real Estate - Freehold or Condos

Real Estate Agent Commission, if you work with an experienced agent you will receive well over what you pay them for their expertise and negotiation skills. The cost of a Real Estate Agent in Toronto ranges from 1.5% (if you’re selling in a hot market) to 2.5% if you are selling a property which requires extensive marketing, creative negotiation skills, and knowledge (e.g. selling a unique cottage, the sale of vacant land, an exclusive condo assignment sale, etc).

Buyers will almost always be working with agents (consulting them for their expert advice) when it comes to making one of the biggest investments of their life. Agents can spend many months or even years of their time, energy, and effort search for properties to meet their buyer’s needs. The standard rate in the industry for buyer's agents is 2.5%, which is paid by the seller to the buyer's brokerage for bringing the buyers. Sometimes an effective tactic is to offer the agent a greater incentive for them to dedicated more time to reviewing and present your property; we had many successful deals when offering 3% commission which attracted multiple offer situations and sales over the asking price.

Lawyer Fees: your lawyer will review all the paperwork, make the necessary adjustments and coordinate with the buyer’s lawyer to facilitate the transaction. As previously mentioned, your lawyer’s fee will depend on how much work they will have to do and can range from $1,000 to $2,500 depending on the property (You can consult with our proven lawyer Alan Fenster at Fenster Law and get a discount by mentioning this website)

Status Certificate (Condos): When selling a condo your buyer will undoubtedly request that you produce a current copy of the status certificate. This lengthy document will have vital information about the condo e.g. the balance of the reserve fund, any upcoming major repairs, and other issues that the condo might have. We recommend that you order this document in advance when selling your condo as it can take up to 10 days for your condo corporation to produce it. The cost of this document is roughly $100.

Staging Costs: It almost always (and we mean almost always) pays to decorate your home using a professional stager. Home buyer’s most often buy a home based on how it makes them feel. Which is why making a home feel warm and welcoming results in a faster sale with a much higher price. Real Estate Agents know this well which is why they have a trusted stager and photographer ready to bring the best out of your living space. The cost for staging your home is based on the amount of furniture that you will need and can range from $500 to $2,500 per month. After the staging is set up, a photographer will take pictures for a one-time fee of about $200 to $400 depending on certain extras like aerial drone footage, and virtual tour production.

Taxes: You will NOT have to pay any capital gains taxes on the sale of your primary residence - granted that you are a Canadian Resident. A primary residence is the residence that is normally inhabited by you or your family members during the year.

Mortgage Discharge Costs: Once you have sold your property you will need to discharge the mortgage. Having an Open or a Closed mortgage can have a big impact on this payment amount. You can find out what the fees will be by reviewing your contract or calling your lender. One way to avoid large fees for discharging a closed mortgage is to transfer the mortgage to the new property that you purchased. The fee for a mortgage discharge is between $200 - $600.

Bonus Optional Services

Property Value Appraisal: Normally your Real Estate Agent will be an expert on the recent sales history in your area and can provide you with a price range for your property. The Property Appraisal is useful when you are selling a unique property (like a custom built villa) that does not have any comparable sales. The Property Value Appraisal is done by a licensed property appraiser and can be valuable during the negotiation. The cost of a licensed home appraisal can range from $300 - $500 dollars.

Home Inspection: While it is not mandatory to have a home inspection, we highly recommend getting a professional home inspection done when purchasing a used home. Most often the home inspection will turn up some hidden defects which can be used to renegotiate the price to include the costs of fixing these problems. The approximate cost to hire a home inspector is between $400 - $600 dollars, but it can save you thousands of dollars in fixing hidden problems.

Land Survey: It is important to conduct a land survey when buying large plots of land. Surveys are also needed when applying for building permits with the city. The cost of a land survey can be from $100 - $800 dollars which will depend on the size of the land and if there was a recent survey done.

Purchasing Real Estate can feel overwhelming which is why we are here to help guide you every step of the way.

If you have any questions feel free to contact us for a consultation.

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Call Us For More Info: 416-577-3504