The Costs of Selling a House in Ontario: A Seller's Budget for 2026

When people estimate what they will walk away with from a sale, they often start with the price and subtract the mortgage. The real number is lower, because selling a home has its own set of costs. Knowing them up front helps you set expectations, plan your next purchase and compare offers on a net basis. Our existing post on closing costs for buyers covers the purchase side; this post is the seller's version.

1. Brokerage commission

For most sellers, the largest cost is the brokerage's remuneration. In Ontario, commissions are negotiable. Under TRESA, a brokerage must have a written representation agreement with you that sets out how it will be paid, whether as a percentage, a fixed amount or a combination, and a salesperson cannot claim that a commission rate is fixed or approved by a government or association (RECO Bulletin 2.3, accessed October 2026). The listing agreement also states whether and how the brokerage shares its commission with a buyer's brokerage. Read it carefully, including any holdover clause, before you sign.

2. HST on the commission

HST at 13% generally applies to a registered brokerage's commission and to other taxable services, such as legal fees (Canada Revenue Agency, accessed October 2026). When you estimate your costs, add HST to these service fees rather than treating them as tax-included.

3. Legal fees and disbursements

You need a real estate lawyer to complete the sale. The lawyer reviews the agreement, deals with your mortgage discharge, prepares closing documents and handles the funds. Fees vary by firm and complexity; ask for a written quote that includes disbursements and HST.

4. Mortgage payout costs

If you have a mortgage, the lender will be paid out on closing. Costs can include:

• Prepayment penalty: if you break a closed mortgage before its term ends, the penalty can be significant. Ask for a payout statement early.
• Discharge fee: many lenders charge an administrative fee to discharge the mortgage from title.
• Portability: if you are buying another home, check whether you can port your mortgage to avoid a penalty.

5. Getting the home ready

Preparation costs vary widely: repairs, painting, cleaning, landscaping, storage and possibly staging. A pre-listing inspection is optional but can help you price and disclose issues. Our posts on pre-listing prep and staging on a budget have ideas for keeping these costs in check.

6. Adjustments on closing

On closing, the lawyers adjust for property taxes, utilities and, for condos, common expenses. If you have prepaid taxes for the year, you may receive a credit; if you are behind, you will pay the difference. Rental equipment, such as a water heater, may need to be assumed by the buyer or paid out, depending on the agreement.

7. Moving and overlap costs

Budget for movers, packing supplies, utility connections and, if your sale and purchase do not line up, short-term rentals, storage or bridge financing. Even a few days of overlap can add up.

8. Taxes on the sale

If the home was your principal residence for every year you owned it, the gain is generally not taxable, but CRA still requires you to report the sale on Schedule 3 and designate the property on Form T2091(IND) (Canada Revenue Agency, accessed October 2026). If the home was a rental or not your principal residence for some years, part of the gain may be taxable. Talk to an accountant before you list.

A simple worksheet

Start with your expected sale price, then subtract:

1. Brokerage commission plus HST.
2. Legal fees, disbursements and HST.
3. Mortgage balance, prepayment penalty and discharge fee.
4. Preparation and staging costs.
5. Moving and overlap costs.
6. Estimated closing adjustments.
7. Any taxes on a non-exempt gain.

The result is your estimated net proceeds. It is only an estimate, because the actual sale price and closing adjustments are not known until the deal closes. Running these numbers before you list helps you avoid surprises when you plan your next purchase.

Costs that sellers often forget

• Rental equipment buyouts: rented water heaters, furnaces or water softeners may need to be paid out or assumed under the agreement.
• Condo-specific costs: the seller often pays for the status certificate, and any arrears or special assessments due before closing.
• Utility final readings: final water, gas and hydro bills arrive after you leave.
• Cleaning after move-out: most agreements expect the home to be left in a clean condition.
• Insurance overlap: keep insurance on the property until closing, and make sure your new home is insured from the day you take possession.
• Repairs required by the agreement: if you agree to fix items before closing, budget for them.

Comparing offers on a net basis

When you receive more than one offer, the highest price is not always the best result. A slightly lower offer with a closing date that matches your purchase may save you bridge financing or moving and storage costs. An offer with a larger deposit and no financing condition may reduce your risk of the deal collapsing. Translating each offer into an estimated net amount, after the costs above, makes those trade-offs easier to see. Our post on the steps to sell a house in Ontario explains where these decisions fit in the process.

When to run the numbers

The best time to estimate your selling costs is before you sign a listing agreement, and again when offers arrive. Early estimates help you decide whether to sell now, what you can afford next and how much to spend on preparation. A second estimate at offer time helps you compare offers on what you will actually take home. Ask your lender for a payout statement and your lawyer for a fee quote early, so the figures you use are real rather than guesses.

Frequently asked questions

Are real estate commissions negotiable in Ontario?

Yes. Commissions are negotiable and must be set out in a written representation agreement, according to RECO.

Is HST charged on real estate commission in Ontario?

HST at 13% generally applies to a registered brokerage's commission and to other taxable services such as legal fees.

Do I pay land transfer tax when I sell?

No. Land transfer tax is paid by the buyer. Sellers have their own costs, such as commission, legal fees and mortgage payout costs.

Do I need to report the sale of my home to CRA?

Yes. Even if it was your principal residence, CRA requires you to report the sale on Schedule 3 and designate the property on Form T2091(IND).

General information only, not legal, tax or financial advice. Figures were checked against the sources linked above in October 2026 and can change; confirm your own numbers with your real estate lawyer, accountant or lender before you sign anything.

Farshad Fazaeli, Salesperson, International Realty Firm, Inc., Brokerage, 647-667-5555 · Richmond Hill, ON