Cost of Selling a Home in Ontario: What Fees Should You Expect?
Selling? Don’t Let Hidden Costs Eat Your Profit
Selling your home feels like leveling up in real life. Maybe you’re upsizing, downsizing, or cashing out of an investment but before you start counting your profits, there’s something you need to know:
Selling a home in Ontario comes with a price tag. And if it’s a rental or investment property, capital gains tax might be waiting for you at the finish line like an uninvited relative at a housewarming.
Whether you’re listing your family home in Windsor or selling an income property in Tecumseh, this guide will break down every cost you can expect, including those the big platforms like Zillow rarely talk about.
1. Realtor Commission Fees
Let’s start with the one everyone thinks they understand.
In Ontario, the standard commission rate is around 5% of the home’s sale price, typically split between:
- Your listing agent (2.5%)
- The buyer’s agent (2.5%)
Example: If you sell your home for $600,000:
- 5% = $30,000 in commissions
- Each agent gets $15,000 (plus HST)
This fee covers more than just a few MLS photos and yard signs. You’re paying for:
- Market analysis and pricing strategy
- Professional marketing (photography, social media, open houses)
- Negotiation skills that can add thousands to your bottom line
- Guidance and liability protection from listing to closing
✅ Yes, commission is negotiable but so is the quality of service you get. Ask what’s included before chasing the lowest rate.
2. Legal Fees
In Ontario, you must hire a lawyer to close the sale. They’ll:
- Discharge your mortgage
- Transfer legal ownership
- Handle funds and final adjustments
- Ensure your documents are legally sound
Typical cost: $800–$1,500 + HST
This isn’t just paperwork it’s your legal protection. If something goes sideways in the deal (title issues, outstanding taxes, incorrect buyer conditions), your lawyer is the one who keeps things from blowing up before closing day.
3. Mortgage Discharge Fees
Still owe money on your mortgage? You’ll need to pay:
- A discharge fee: Usually $200–$400 to legally remove the mortgage from title
- A prepayment penalty: If you’re breaking a fixed-term mortgage early
Let’s say your 5-year fixed mortgage still has 18 months left. Even though you’re selling, your lender wants to be compensated for interest they expected to collect. That’s where the Interest Rate Differential (IRD) or 3 months’ interest penalty comes in.
Windsor Tip:
Get a mortgage payout statement before you list. I’ve seen surprise penalties eat up thousands of dollars in net profit.
4. Home Prep & Staging Costs
Want your home to sell faster and for more? It needs to shine.
Prep costs include:
- Minor repairs & touch-ups: $500–$2,000
- Professional staging: $1,000–$3,500
- Deep cleaning & decluttering: $250–$500
- Storage unit (for excess furniture): ~$150/month
Staging isn’t just about pretty throw pillows. It’s about selling a lifestyle and helping buyers picture themselves living there. In Windsor-Essex, staged homes often sell for $5K–$15K more than unstaged ones.
And let’s be honest… we all have that one “junk room” that could use a makeover
5. Moving Cost
You sold the house now you’ve got to get out.
Expect to pay for:
- Local movers (within Windsor-Essex): $1,000–$2,000
- Packing supplies & boxes: $200–$400
- Out-of-town move: $3,000+ depending on distance
- Cleaning crew for buyer possession: ~$250
Many sellers forget to factor this in, especially if they’re moving in stages. And if you’re moving in winter (hello, slippery sidewalks), hiring help is worth every penny.
6. Property Tax & Utility Adjustments
At closing, your lawyer will calculate:
- What portion of annual property taxes you still owe (or overpaid)
- Utility usage up to the possession date
Let’s say you’ve prepaid your property taxes through July, but the closing is in May. You’ll be refunded the difference. Or vice versa if you’re behind, the amount will be deducted from your sale proceeds. This ensures both buyer and seller only pay their fair share up to the day the keys change hands.
7. Capital Gains Tax (Rental, Cottage, or Investment Property)
This ONLY applies if the property isn’t your primary residence.
Here’s how it works:
- 50% of your profit (gain) is taxable
- The gain is added to your income for the year and taxed at your marginal rate
Example:
Bought a rental for $350,000
Sold it for $600,000
Profit: $250,000
Taxable capital gain: 50% of $250,000 = $125,000 added to income
This can bump you into a higher tax bracket, especially if you’re still working full-time. And unlike primary residences, you can’t claim exemption on investment properties
8. Optional Costs That Pay Off
Here are a few expenses that aren’t mandatory but can give you a serious edge:
- Pre-listing home inspection: $350–$500 (can prevent deal-breakers)
- Pro photography + 3D tour: $300–$700 (makes your listing pop)
- Junk removal: ~$300 per load
- Home warranty for buyers: ~$500 (gives buyer peace of mind, attracts offers)
Total Estimated Seller Costs: $600K Windsor Property
| Cost Type | Estimate |
|---|---|
| Realtor Commission (5%) | $30,000 |
| Legal Fees | $1,200 |
| Mortgage Discharge/Penalty | $400–$6,000 |
| Home Prep & Staging | $2,000–$4,000 |
| Moving & Cleaning | $1,500–$2,500 |
| Capital Gains Tax (if rental) | Varies—consult your accountant |
| Total (excluding CGT) | $35,000–$44,000+ |
FAQs: Selling Costs & Capital Gains in Ontario
Q: Do I owe capital gains if I lived in the home for 3 years, then rented it?
A: Possibly. You’ll need to declare a “change of use” to CRA and may be eligible for partial exemption.
Q: Can I deduct landscaping or paint jobs?
A: Not unless they were major capital improvements that increased the value routine maintenance doesn’t count.
Q: How do I report capital gains on a rental?
A: Use Schedule 3 of your T1 tax return. A tax advisor will ensure it’s filed correctly and you’re not overpaying.
Knowing the Costs = Keeping More Profit
Selling your Windsor-Essex property whether a cozy family home or an income-generating duplex is about more than the sold price.
Knowing the full cost to sell (including tax implications) helps you price smart, plan ahead, and walk away with more money, less stress, and no regrets.
🎯 Want to Know What You’ll Net?
📞 Text me at 437-440-3017 or book a free home sale strategy session
🎁 BONUS: Get my “Seller’s Cost & Tax Calculator” Google Sheet to run the numbers yourself.
