All You Need to Know About Closing Costs for Home Sellers in Toronto

Selling your home in Toronto can be exciting—but it also comes with expenses that can catch you off guard. Imagine sitting at your lawyer’s office, expecting a hefty profit, only to see thousands of dollars deducted from your proceeds. That’s the reality of closing costs, and if you’re not prepared, they can put a serious dent in your earnings.

In this guide, we’ll break down the typical closing costs Toronto home sellers face, why they exist, and how to keep more of your money when you sell.

What Are Closing Costs?

Closing costs are the final expenses that come with completing the sale of your home. These include real estate commissions, legal fees, mortgage discharge costs, and more.

In Ontario, closing costs for sellers typically range from 4% to 7% of the sale price.

Knowing what to expect can help you budget smartly, avoid surprises, and walk away from the closing table with confidence.

The Most Common Closing Costs for Home Sellers in Toronto

1. Real Estate Agent Commissions

 In Canada, real estate commissions are negotiable and typically range from 3% to 7% of a property's sale price, varying by region and specific agreements between sellers and agents. For most sellers, this is the biggest expense.

• Typical rate in Ontario: Often 5% of the sale price (e.g., 2.5% to each agent)
• Why it matters: A skilled agent can market your home, generate interest, negotiate strong offers, and help you close for top-dollar

Example:

On a $1 million home in Toronto, a 5% commission would be $50,000.

2. Land Transfer Taxes

Ontario sellers don’t usually pay Land Transfer Tax—that’s the buyer’s responsibility. However, in Toronto, there’s an additional municipal tax, so it's worth understanding how it affects negotiations.

• Who pays: Almost always the buyer
• What it is: Ontario Land Transfer Tax (LTT): Up to 2.5%
• Toronto Municipal LTT: Mirrors the provincial tax, essentially doubling the total
• Why it matters for sellers: Buyers may factor this extra cost into their offers, especially in slower markets

If you’re buying again in Toronto, expect to pay both the provincial and municipal LTT on your next property.

3. Legal Fees

Sellers in Toronto must hire a real estate lawyer to handle the transaction.

• What they do: Review the Agreement of Purchase and Sale
• Handle the discharge of your mortgage
• Prepare legal documents
• Transfer title
• Typical cost in Toronto: $1,000 to $1,800, depending on complexity

4. Mortgage Discharge Fees

If your mortgage isn’t paid off, you’ll need to discharge it before closing.

• Legal discharge fees: Usually around $300–$400
• Prepayment penalties: If you’re breaking a fixed-rate mortgage before maturity, the penalty could be several thousand dollars (check with your lender for an estimate)

5. Property Tax and Utility Adjustments

You’re responsible for your share of property taxes, utilities, and any condo or maintenance fees up to the closing date.

• How it’s calculated: Costs are prorated. For example, if your annual property taxes are $6,000 and you sell halfway through the year, you’ll pay $3,000

Your lawyer will finalize these amounts on your Statement of Adjustments.

6. Condo Fees and Status Certificate (if applicable)

If you’re selling a condo in Toronto, here’s what to expect:

• Outstanding maintenance fees must be paid before closing
• Status certificate: Usually costs $100–$150 and is typically ordered by the seller for the buyer’s lawyer
• Some condos also charge move-out or elevator booking fees

7. Moving Costs and Final Touches

While not part of the official closing costs, these expenses add up quickly:

• Hiring movers or renting a truck
• Storage or temporary accommodations
• Final repairs or home staging

In a competitive market like Toronto, staging and minor touch-ups can make a difference—and come with a price tag.

How to Reduce Your Closing Costs in Toronto

Closing costs can take a sizable chunk out of your home sale profits, but the good news is that there are ways to cut back on these expenses. Whether through negotiation, strategic choices, or finding cost-effective service providers, you have options to keep more money in your pocket. Here are some practical ways to lower your closing costs as a seller.

Sell Without an Agent (FSBO) — this means no listing agent commission. However, you’ll still need to:

• Pay the buyer’s agent commission (usually 2.5% to 3%).
• Handle marketing, negotiations, and paperwork yourself.

FSBO works best if you have experience in real estate or a buyer already lined up.

Ask the Buyer to Cover Some Costs

• In some deals, buyers agree to cover certain closing costs instead of negotiating a lower sale price.
• This works best in a seller’s market, where buyers compete for homes.

Shop Around for Service Providers

• Get multiple quotes for title insurance, escrow services, and attorneys.
• Some companies offer discounts for bundled services.

Preparing for Closing

As you approach the finish line of your home sale, there are still a few final steps to take before closing day. Proper preparation can help avoid last-minute surprises and ensure everything goes smoothly. Here’s what you need to do before handing over the keys.

1. Review the Closing Disclosure Early

• You’ll get a Closing Disclosure a few days before closing that lists all costs.
• Review it carefully to catch any unexpected charges.

2. Finalize Repairs and Paperwork

• Complete any agreed-upon repairs before closing.

Make sure liens, HOA fees, and taxes are paid to avoid delays.

Final Thoughts

Selling a home in Toronto is more than finding a buyer. The hidden costs can catch you off guard—but by understanding them upfront and planning strategically, you can reduce stress and maximize your net proceeds.

If you're preparing to sell your home in Toronto and want a personalized breakdown of your estimated closing costs, connect with a local real estate expert who understands the ins and outs of the city’s unique market.