by Faiza Ahmed (Broker) 
Selling a house in Ontario involves several costs that can significantly impact your net proceeds. Understanding these expenses is crucial for effective financial planning.
A comprehensive overview below of the typical costs associated with selling a property in Ontario, along with a calculator will help you estimate these expenses.
Closing Cost Calculator for Seller
Calculation Results
Real Estate Agent Commissions
In Ontario, the combined real estate agent commission customarily ranges from 3.5% to 5% of the property’s selling price. This fee is usually split between the seller’s and buyer’s agents, with each receiving approximately 2.5% of the sale price.
on a $500,000 home, the total commission could be between $17,500 and $25,000 + HST.
Legal fees for selling a house in Ontario often range from $1,200 to $1,800 which cover services like preparing the deed and handling the transfer of funds. It also includes ensuring all legal aspects of the sale.
In Ontario, the Harmonized Sales Tax (HST) of 13% applies to real estate commissions – so if your total commission is $25,000, the HST would be $3,250, bringing the total commission-related cost to $28,250.
If you have an existing mortgage, you will need to pay a discharge fee to your creditor to remove the mortgage from the property’s title and usually, this fee varies by lender. It typically ranges from $200 to $400.
If you are breaking a fixed-rate mortgage before its term ends, you may incur a pre-payment penalty and this penalty can be quite substantial, depending on your mortgage agreement.
To make your home more tempting to buyers, you might invest in repairs or staging while costs can be different widely based on the property’s condition and the extent of improvements made.
Moving costs could be an unseen burden so do not forget to budget for moving expenses, which can include hiring professional movers, renting a truck, and other related costs.
You could be subject to ‘capital gains tax’ from the sale of your property (on the profit) if the property was not your principal residence throughout the time period of your ownership so, it is best advised to consult with a tax professional to understand your specific situation.
In Conclusion
Selling a house in Ontario incurs several costs that can add up and by understanding these expenses and utilizing our closing costs for seller calculator, you can better prepare for the financial aspects of selling your property.
For a smooth and informed selling process, it’s important to seek guidance from industry professionals. Those looking to minimize real estate commission costs may consider working with a low commission realtor to explore cost-effective options.
Disclaimer: Calculations are just an estimate and for reference purposes only.