The price on your agreement isn’t the only cheque you’ll write. Pre-construction closings come with a statement of adjustments that can add thousands, sometimes tens of thousands, of dollars. Budgeting for them early is one of the smartest things you can do.
Costs every buyer pays
Land transfer tax
Ontario charges provincial land transfer tax (LTT) on every purchase. For homes, it’s calculated on a sliding scale from 0.5% on the first portion of the price up to 2% (and 2.5% on the portion above $2 million for one- and two-family homes). Buyers in the City of Toronto also pay a municipal land transfer tax at similar rates, which roughly doubles the bill. First-time buyers can claim refunds of up to $4,000 provincially and up to $4,475 in Toronto.
Alberta has no land transfer tax, only modest registration fees, while British Columbia charges a property transfer tax with exemptions for some first-time and new-home buyers. See our Calgary vs Edmonton and Toronto vs Vancouver comparisons.
Legal fees and title insurance
Expect legal fees plus disbursements, and title insurance. Pre-construction closings, especially condos with interim occupancy, often involve more legal work than resale.
Builder adjustments
These are charged by the builder on the statement of adjustments. Your agreement determines which apply and whether they’re capped.
- Development charges and levies: municipal charges for infrastructure. Increases after you sign may be passed on unless your agreement caps them. In 2026, the federal and Ontario governments launched a program funding municipalities that cut development charges, so check the current rates in your city.
- Education development charges for school boards.
- Tarion enrolment fee (Ontario) and HST on it.
- Utility connections and meters: hydro, water and gas meter installation and connection.
- Section 37 / community benefits charges and parkland levies, depending on the municipality.
- Law Society levy and registration fees.
- Reserve fund contribution for condos, often equal to two months of common expenses.
- Prepaid common expenses and realty taxes adjustments.
A cap on development charges and levies is one of the most valuable things to negotiate. See how to negotiate pre-construction prices.
HST and rebates
Most Ontario builders quote prices “including HST, net of rebates,” which means you assign the standard new housing rebates to the builder. If you don’t qualify (for example, because you’re buying to rent), you may owe the rebate amount back at closing. Recent federal and Ontario programs can reduce HST much further for eligible buyers. Read our GST/HST rebate guide.
Mortgage-related costs
- Mortgage default insurance premium if you put down less than 20%. In Ontario, provincial sales tax on that premium must be paid in cash at closing.
- Appraisal fees and any shortfall if the appraisal is below your price.
- Interest adjustment between closing and your first payment.
See our mortgage pre-approval guide.
Condo occupancy costs
Condo buyers pay interim occupancy fees between move-in and final closing. These are not closing costs, but they affect your cash flow. See occupancy vs final closing.
How much should you budget?
There’s no single number, because it depends on your city, price and agreement. Many buyers budget a few percent of the purchase price on top of their deposits, and more in Toronto because of the double land transfer tax. Ask your lawyer for an estimated statement of adjustments early, and ask the builder for a list of capped and uncapped charges.
Frequently asked questions
When will I know the exact closing costs?
Your lawyer receives the statement of adjustments from the builder shortly before closing. You can request an estimate much earlier.
Are closing costs different for townhomes and detached homes?
Freehold homes skip condo items like reserve fund contributions but may have larger development charges and lot-related adjustments.
Can closing costs be added to my mortgage?
Generally no; most must be paid in cash at closing.
Planning your purchase? Start with our first-time buyer’s guide or browse projects in Toronto and Mississauga.
General information only. Rates and programs change; confirm with your real estate lawyer and municipality.
