A clear guide to understanding the financial side of your home sale

Selling a home in Toronto isn’t just about putting a sign on the lawn and waiting for offers. It’s a major financial decision—and one that comes with its own set of expenses. Whether you’re relocating, downsizing, or selling after a life change, understanding the real costs involved can help you plan more strategically and avoid unwelcome surprises.

In this post, I’ll walk you through the standard (and often overlooked) costs of selling a home in Toronto, how they affect your net return, and how to make smart decisions that protect your equity.

1. Real Estate Commissions

One of the most discussed costs in any home sale is the real estate commission. In Toronto, commissions are commonly calculated as a percentage of the final sale price and are typically split between the listing agent and the buyer’s agent.

What to know:
– Total commission often ranges from 4% to 5% depending on property type, location, and service level
– This fee is only paid when your home sells successfully
– It covers marketing, negotiation, staging coordination, showing management, and professional oversight from start to finish

A note on value:
Hiring an experienced listing agent is not just about visibility—it’s about maximizing your sale price. A well-represented property often attracts more serious buyers, spends less time on the market, and achieves stronger offers. In a shifting market like 2025, strategy and pricing precision matter more than ever.

2. Legal Fees

Every home sale in Ontario requires the services of a real estate lawyer to handle the legal side of the transaction. Your lawyer will:

– Review and finalize the agreement of purchase and sale
– Discharge your mortgage
– Manage title transfer and closing documentation
– Ensure funds are received and distributed correctly

Estimated cost:
For most residential transactions, legal fees range from $1,000 to $2,500+ before tax, depending on the complexity of the sale. Your agent can often refer you to a trusted legal partner for a quote.

3. Pre-Listing Expenses (Optional but Impactful)

Before going to market, many sellers invest in their property to improve presentation and enhance appeal. These aren’t mandatory, but they can significantly influence your selling price—especially in Toronto’s competitive neighbourhoods.

Common pre-listing costs may include:
– Pre-sale cleaning ($300–$700)
– Staging ($2,000–$5,000+ depending on home size and duration)
– Landscaping or curb appeal updates ($500–$2,000)
– Repairs or light cosmetic updates (variable)

Pro tip:
Not every improvement is worth doing. A good listing agent will help you identify which updates will offer the highest return—and which ones you can skip entirely.

4. Mortgage Discharge & Potential Penalties

If you’re breaking a mortgage before its term ends, your lender may charge a mortgage prepayment penalty. This cost can vary significantly based on:

– Whether your rate is fixed or variable
– How much time remains on your term
– Your lender’s policies

Estimate:
This can range from a few hundred dollars to several thousand, depending on your situation. Before listing, it’s wise to request a prepayment quote from your mortgage lender so you’re not caught off guard.

5. Moving & Transition Costs

Many sellers focus only on the transaction itself—but there are other expenses to consider after your sale closes.

Common post-sale costs include:
– Movers or relocation services
– Short-term rentals if your purchase hasn’t closed yet
– Storage for furniture or belongings
– Utility disconnection/reconnection and cleaning fees

Though these vary by lifestyle and timing, budgeting for at least $1,500–$5,000 for moving-related expenses is realistic.

6. Capital Gains (If Applicable)

For most Toronto homeowners, selling your primary residence is not subject to capital gains tax. However, if you’re selling a secondary property—such as an investment unit, cottage, or rental—you may need to pay tax on any gain in value.

If you’re unsure, consult your accountant or tax advisor early in the process. Your real estate agent can also work with your professional team to ensure you’re planning appropriately.

Final Thought

Selling your home is more than a transaction—it’s a strategic decision that affects your financial future. While there are costs involved, the key is to understand them, plan for them, and make smart choices that protect your equity.

If you’re considering selling and want a clear view of what to expect—no pressure, just real numbers and strategy—I’m happy to walk you through your options.

Send an email at olena@agentolena.com or call 647.294.3039 to get started.