Closing Costs on Pre-Construction Condos in Ontario

One of the most common questions we get from first-time pre-construction buyers is “what else will I actually owe beyond the purchase price?” Here’s the full list of cost categories to budget for.

Land Transfer Tax

Ontario charges provincial Land Transfer Tax on every home purchase, calculated on a sliding scale based on purchase price. If the property is in Toronto, a separate Toronto Municipal Land Transfer Tax applies on top of the provincial tax. First-time buyers can qualify for a rebate on both (up to $4,000 provincially, up to $4,475 for the Toronto municipal tax) — ask your lawyer to confirm you’re claiming everything you’re eligible for.

Development Charges / Levies

Builders pass through municipal development charges, education levies, and similar fees tied to the specific project and city. These can be significant and are not always capped by default — this is exactly why negotiating a capped development-charge clause into your Agreement of Purchase and Sale matters, and it’s something our team reviews with every registered buyer before they sign.

Tarion Warranty Enrolment Fee

Ontario’s mandatory new home warranty program (Tarion) charges an enrolment fee, typically built into the builder’s closing cost statement, covering defect protection for a set period after you take possession.

Legal Fees

A real estate lawyer is required to close on a property in Ontario. Budget for their fee plus disbursements (title searches, registration fees) — pre-construction closings tend to run a bit higher than resale legal fees given the additional statement-of-adjustments work involved.

Title Insurance

Standard practice on virtually every closing in Ontario, protecting against title defects or fraud — typically arranged by your lawyer as part of the closing package.

Utility Hookups and Meter Fees

New construction often includes one-time connection fees for hydro, water, and gas metering that resale purchases don’t carry, since the unit is being connected for the first time.

Common Element / Reserve Fund Adjustment (Condos)

Condo purchases typically require a contribution to the building’s reserve fund at closing (often two to three months of maintenance fees), plus a pro-rated adjustment for the current month.

HST — See Our Separate Guide

Depending on whether you’re an owner-occupier or an investor, HST treatment differs significantly — see our full breakdown in HST Rebate on New Homes in Ontario, Explained.

Budget a Buffer

As a rough rule of thumb, buyers should budget an additional 1.5%–2.5% of the purchase price for closing costs beyond the price and deposits — more if buying as an investor given the HST timing difference above. Every project’s specific fee structure differs, which is exactly what our team walks new registrants through before you commit to any specific launch.