Selling a home in Ontario costs more than most sellers anticipate. The headline number — real estate commission — is the largest expense, but it's not the only one. Legal fees, mortgage prepayment penalties, pre-sale preparation costs, and moving expenses add up quickly. A GTA seller netting $900,000 from their sale might have paid $60,000–$80,000 in total selling costs to achieve that number. Understanding the full cost picture before you list lets you plan your net proceeds accurately and avoid surprises at closing.
Real Estate Commission
Commission is typically the largest cost of selling. In Ontario, the total commission on a sale is negotiated between the seller and listing agent, and is traditionally split between the listing brokerage and the buyer's brokerage. Standard rates in the GTA in 2025 run:
- Total commission: 3.5–5% of sale price
- Listing agent side: 1.5–2.5%
- Buyer's agent side (co-operating commission): 2–2.5%
On a $900,000 sale at 5% total commission: $45,000. On a $1,200,000 sale at 4.5%: $54,000. Commission is negotiable — see our guide on whether commission can be negotiated. HST applies to the commission amount (13% in Ontario), adding $5,850 on a $45,000 commission.
Legal Fees
Every Ontario home sale requires a real estate lawyer on the seller's side. Legal fees for a standard residential sale run $1,500–$3,000 in legal fees plus disbursements ($200–$500 for title search, registration, and document retrieval). Total legal cost: $1,700–$3,500 typically. Complex transactions — estate sales, divorce sales, title issues — cost more.
Mortgage Prepayment Penalty
If you have a closed mortgage and are selling before the end of your term, your lender charges a prepayment penalty. For fixed-rate mortgages, the penalty is the greater of 3 months' interest or the Interest Rate Differential (IRD) — the IRD can be substantial on longer fixed terms with large balances. Variable rate mortgages typically charge 3 months' interest only.
On a $600,000 mortgage balance with 2 years remaining on a 5-year fixed at 4.5%, the IRD penalty can easily reach $15,000–$25,000. Contact your lender early in the selling process to get your exact payout statement — don't estimate this.
Pre-Sale Preparation Costs
Home staging: Professional staging for a GTA home typically runs $2,000–$5,000 for a vacant property (furniture rental + staging) or $500–$1,500 for occupied staging consultation. Well-staged homes generally sell faster and for higher prices — most agents consider it a worthwhile investment.
Pre-listing repairs and updates: Paint, landscaping, minor repairs, cleaning — budget $2,000–$10,000 depending on the property's condition and how much work you choose to do. A fresh coat of neutral paint throughout ($3,000–$6,000 professionally done) consistently improves buyer perception.
Pre-listing home inspection: Optional but increasingly common. Cost: $400–$600. Lets you address issues before buyers find them and reduces risk of deals falling through on inspection conditions.
Professional photography: Included in most full-service listings, but verify. Drone photography for properties with notable outdoor features: $200–$400 additional.
Moving Costs
A professional move within the GTA runs $1,500–$5,000+ depending on home size, distance, and services (packing vs. transport only). Long-distance moves are significantly more. If there's a gap between sale closing and your next home closing, add short-term storage ($200–$500/month) and possibly temporary housing costs.
Capital Gains Tax
For your principal residence — the home you ordinarily lived in — the principal residence exemption under the Income Tax Act eliminates capital gains tax on sale. This applies as long as the home was designated your principal residence for each year of ownership. Investment properties and vacation properties don't qualify for the full exemption and generate a taxable capital gain.
What Sellers Often Forget
Property tax adjustments at closing: if you've prepaid property taxes beyond the closing date, you get a credit from the buyer. If you're in arrears, you owe the difference. Utility adjustments (gas, hydro, water) are also prorated at closing through the Statement of Adjustments your lawyer prepares.
Full Cost Summary
| Cost item | Typical range (GTA 2025) |
|---|---|
| Real estate commission (incl. HST) | $40,000–$70,000 |
| Legal fees + disbursements | $1,700–$3,500 |
| Mortgage prepayment penalty | $0–$25,000+ |
| Staging | $500–$5,000 |
| Pre-sale repairs and prep | $2,000–$10,000 |
| Moving costs | $1,500–$5,000 |
| Total (without mortgage penalty) | $45,700–$93,500 |
For a complete breakdown of the documents you'll need, see our guide on documents required to sell a home in Ontario.
FAQ
How much of the sale price do I actually keep as the seller?
On a $900,000 sale with a $400,000 remaining mortgage, 5% commission, standard legal fees, no prepayment penalty, and $5,000 in prep costs: approximately $440,000–$445,000 after costs. Your specific net depends on your mortgage balance, commission rate, and prep investment. Run the numbers with your agent and lawyer before listing.
Do sellers pay land transfer tax in Ontario?
No. Ontario Land Transfer Tax and Toronto Municipal Land Transfer Tax are paid by the buyer, not the seller. Sellers pay commission, legal fees, and mortgage discharge costs — not land transfer tax.
Is real estate commission tax deductible when selling?
If you're selling your principal residence, the principal residence exemption eliminates capital gains tax entirely, so there's nothing to deduct commission against. If selling an investment property, the commission and legal fees are added to the adjusted cost base, reducing your capital gain. Consult an accountant for your specific situation.
What is the HST on commission in Ontario?
Commission is subject to 13% HST. On a $45,000 commission, HST adds $5,850 — total commission cost is $50,850. This is factored into the commission rate you negotiate; make sure you're clear whether the rate you're quoted is before or after HST.
When do I pay the selling costs — at listing or at closing?
Commission and legal fees are paid at closing, deducted from the sale proceeds before you receive your net amount. Pre-sale costs (staging, repairs, photography) are paid as incurred. Mortgage prepayment penalties are paid through the discharge at closing. You don't need cash upfront for the big items — they flow through closing.