The purchase price is the number everyone talks about. The closing costs are the number that arrives the week before possession, in a lawyer’s statement, and it is the one that catches people who budgeted only for the down payment. None of it is hidden, but very little of it is explained up front. Here is the whole list, in the order it tends to appear.
Why This Matters More in a Slower Market
TRREB’s September 2026 figures show homes across the GTA selling for 98% of asking after an average of 34 days on the listing, with the average price down 5.1% from a year earlier. Buyers have room to negotiate on price, and some are tempted to spend that room on the down payment. The costs below do not shrink when the price does, and they cannot be financed into the mortgage. Cash you plan to put down is cash you may need at closing.
Costs the Buyer Pays
Land transfer tax
The largest single closing cost for most buyers. Ontario charges a provincial land transfer tax on a graduated scale, and the City of Toronto charges a second, separate municipal tax on top. That is the structural difference that matters for this region: a buyer in Markham, Richmond Hill or Vaughan pays the provincial tax only, while a buyer in North York pays both, because North York has been part of the City of Toronto since 1998. Two similarly priced houses a few kilometres apart can carry very different tax bills. Eligible first-time buyers can claim a refund of part or all of each tax; the rules and limits are set by the province and the city, so confirm them with your lawyer rather than assuming.
Legal fees and disbursements
Your lawyer handles the title search, registers the transfer, and deals with the mortgage documents and the funds. The fee is only part of it: disbursements such as registration charges and searches are billed on top. Get a written quote before you commit, and ask what is and is not included.
Title insurance
Usually arranged through your lawyer, it is a one-time premium covering certain title defects and fraud. Lenders often require it. It is modest relative to everything else on this list, and in practice it is not optional.
Home inspection and any appraisal
A home inspection is paid before you waive conditions, not at closing, but it belongs in the budget. Some lenders also charge for an appraisal. With 4.6 months of inventory across the GTA, buyers have a little more leverage to make an offer conditional on an inspection, and the inspection fee is a small price for using it.
Mortgage default insurance and the tax on it
If your down payment is under 20%, the lender requires default insurance. The premium is normally added to the mortgage balance, but Ontario charges provincial sales tax on that premium, and that tax is payable in cash at closing rather than added to the loan. It is the item most commonly missed by buyers with a minimum down payment.
Adjustments
The seller may have prepaid property tax, utilities or, in a condominium, the monthly fee. Your lawyer apportions these as of the closing date, and you reimburse the seller for the period you will own. It is arithmetic rather than a fee, but it is real money.
Condominium extras
Your lawyer should review the status certificate before you buy: the reserve fund, any planned special assessments and the fee history. There may be a charge for the certificate itself, and some buildings charge a move-in deposit or an elevator booking fee.
Moving, utilities and insurance
Home insurance must be in place on closing day. Movers, utility transfers, connection fees and mail forwarding follow. They are not paid to your lawyer, but they arrive the same week.
New Builds Add a Layer
If you are buying new, in Cornell, Wismer or anywhere else in Markham where new supply is being built, ask what the builder’s agreement treats as extra. Typical items are HST (sometimes included in the price, sometimes not, sometimes subject to a rebate assignment), development charges and levies passed through to the purchaser, Tarion enrolment, utility connection fees, and adjustments for occupancy before final closing. These vary by builder and by agreement. Read the statement of adjustments with a lawyer well before closing day.
Costs the Seller Pays
Sellers have their own list: real estate commission, legal fees, a mortgage discharge fee, possibly a prepayment penalty if the mortgage has time left on its term, and any adjustments in the buyer’s favour. A seller who is also buying has to line up both closings. The practical advice is to ask for a net proceeds estimate at the listing stage, not after the offer arrives.
A Way to Budget
- Ask your lawyer for a closing cost estimate as soon as you start looking seriously, not after your offer is accepted.
- Run your price range through the land transfer tax calculators published by the province and the City of Toronto, and add the Toronto tax only if the property is inside the city.
- Add the tax on the insurance premium if you are putting down less than 20%.
- Hold a buffer for adjustments and for surprises on the statement of adjustments.
- Keep the closing funds separate from your down payment so one does not quietly pay for the other.
What Buyers Most Often Get Wrong
They forget that the balance of the down payment plus the closing costs is due on the same day. They assume a lawyer’s quote is all-in. They forget the Toronto land transfer tax when a North York property is on their list. And they leave no margin, so a delayed closing or a small adjustment becomes a scramble.
Frequently Asked Questions
Can I add closing costs to my mortgage?
Generally no. Closing costs are paid from your own funds. Some lenders offer cash-back products, but those usually carry a higher rate, so look at the full cost before accepting one.
Is the deposit extra or part of the purchase price?
The deposit is credited toward the price, so it counts against your down payment. What is extra is everything listed above.
Do I pay land transfer tax in York Region?
Yes, the provincial tax applies to purchases throughout Ontario. The additional municipal tax applies only inside the City of Toronto, which includes North York.
Who do I ask for an exact number?
Your real estate lawyer. The structure described here is general; the amounts depend on the price, the property and your mortgage, and this article is not legal or tax advice. Ask your lawyer and your mortgage professional to confirm your own numbers.
Are closing costs tax deductible?
That depends on whether the property is your home or an investment, and on your circumstances. It is a question for an accountant.
Buying in Markham, Richmond Hill, Vaughan or North York and want a realistic closing budget before you make an offer? Reach out for buyer representation and we can walk through it for the specific property, or start with how the Markham market is behaving.