Real Estate · Canada

Closing Costs in Canada: The 1.5–4% Nobody Budgets For

Your down payment isn't the only cash you need on closing day. Canadian buyers typically pay another 1.5%–4% of the purchase price in closing costs — $10,500 to $28,000 on a $700,000 home — and lenders expect to see proof you have it. Here's where it goes.

The big one: land transfer tax

• Ontario: marginal bands from 0.5% to 2.5% — about $10,475 on $700,000. Buy in Toronto and the municipal LTT roughly doubles it (~$20,950 total).
• British Columbia: property transfer tax of 1% on the first $200k, 2% to $2M — about $12,000 on $700,000.
• Quebec: "welcome tax" (droits de mutation), roughly 1–1.5% at this price point.
• Alberta and Saskatchewan: no land transfer tax — only modest title registration fees. Same house price, thousands less to close.
• First-time buyer rebates: Ontario refunds up to $4,000, Toronto up to $4,475 on top, BC offers full exemption below set price thresholds. These rebates are the single biggest closing-cost lever for first-timers.

Everything else on the statement of adjustments

Item	Typical range
Legal fees and disbursements	$1,500 – $3,000
Title insurance	$250 – $500
Home inspection (before offer)	$400 – $700
Appraisal (often lender-paid)	$300 – $500
Property tax / utility adjustments	Prorated — often $500 – $2,000
PST/QST on mortgage default insurance premium	See below

The CMHC premium's hidden cash sting

Put down less than 20% and mortgage default insurance (CMHC, Sagen or Canada Guaranty) adds 2.8%–4% of the loan — on a $700,000 home with 10% down, roughly $19,500. The premium itself rolls into the mortgage, but in Ontario, Quebec, Manitoba and Saskatchewan the provincial sales tax on it cannot: Ontario's 8% PST on that premium is about $1,560 due in cash at closing. It surprises buyers every single year.

Sources

• Ontario Ministry of Finance — Land Transfer Tax rates and first-time buyer refund; City of Toronto MLTT
• BC Government — Property Transfer Tax and First Time Home Buyers' Program
• CMHC — mortgage loan insurance premium schedule; FCAC — closing cost guidance (budget 1.5–4%)

Figures as of June 2026; rates and rebate thresholds vary by province and city and change periodically — verify with the relevant provincial ministry. This is general information, not financial or legal advice.