Buying a home is the largest financial transaction most people will ever make. In Ontario, the process involves multiple parties, several legally binding documents, hundreds of thousands of dollars in tax and closing costs, and decisions that will affect your finances for decades. Understanding the legal steps involved, and the role your real estate lawyer plays at each one, is essential to making the transaction go smoothly.
This guide walks through the home buying process in Ontario from first offer to closing day, explains the costs you should budget for beyond the purchase price, covers the tax rebates available to first-time buyers, and explains how to find a real estate lawyer in the GTA who speaks your language. Whether you are a first-time buyer or buying your second or third home, the information here will help you understand what is happening at each stage of the transaction and what your lawyer is responsible for.
The Home Buying Process in Ontario: An Overview
Buying a home in Ontario typically follows the same general sequence, regardless of whether you are buying a freehold house, a condominium, or a newly built property. The exact details vary, but the overall path looks like this:
| Stage | What Happens |
| 1. Mortgage pre-approval | You confirm with a lender how much you can borrow and lock in a rate hold. |
| 2. House hunting | You work with a real estate agent to find suitable properties and view homes. |
| 3. Offer (Agreement of Purchase and Sale) | You make a written offer with conditions; the seller accepts, rejects, or counters. |
| 4. Conditional period | You complete financing approval, home inspection, status certificate review, and other due diligence. |
| 5. Conditions waived (firm deal) | Once all conditions are satisfied, the deal becomes binding. |
| 6. Lawyer’s work begins | Your real estate lawyer conducts title searches, prepares closing documents, and coordinates with the lender. |
| 7. Closing day | Funds are transferred, title registers in your name, you receive the keys. |
The time from accepted offer to closing is typically 30 to 90 days in Ontario, though shorter and longer closings are common. The conditional period within that window is usually 5 to 10 business days for resale properties. Builder properties (newly built) work on a different timeline that can stretch over months or years.
The Agreement of Purchase and Sale
The Agreement of Purchase and Sale (often called the ‘APS’) is the central legal document in a home purchase. It is a legally binding contract once accepted by both buyer and seller. Once signed by both parties and any conditions are waived, the buyer is legally obligated to complete the purchase and the seller is legally obligated to transfer title.
Key Terms in the APS
- Purchase price: the total amount you are agreeing to pay for the property.
- Deposit: a sum (commonly 5% of the purchase price in the GTA) paid to the seller’s brokerage in trust within 24 hours of acceptance. The deposit is credited toward the purchase price at closing.
- Closing date: the day on which title transfers, funds change hands, and you receive the keys.
- Inclusions and exclusions: what is included with the property (appliances, fixtures, light fixtures, window coverings) and what the seller is taking with them.
- Conditions: buyer protections that allow you to walk away from the deal under specific circumstances if not satisfied.
- Irrevocability: the time during which your offer must remain open for the seller’s response, typically 24 to 48 hours.
Common Conditions in an Ontario APS
Conditions are the most important protective tool a buyer has in the APS. The most common conditions in Ontario residential transactions are:
- Financing condition: gives you a set period (usually 5 business days) to confirm your mortgage approval. If financing is not approved, you can walk away with your deposit returned.
- Home inspection condition: gives you the right to have the property inspected by a qualified home inspector, typically within 5 business days. If material defects are found, you can renegotiate or terminate.
- Status certificate review (for condominiums): gives you 10 business days to have your lawyer review the condo’s status certificate. This document discloses the condo corporation’s finances, reserve fund, ongoing legal disputes, and rules. Your lawyer should always review this before you waive the condition.
- Sale of buyer’s home: less common in a competitive market, but allows you to make your purchase contingent on selling your existing home.
In hot markets, sellers sometimes pressure buyers to make ‘firm offers’ (offers without conditions) to compete. This shifts significant risk onto the buyer. If you are considering a firm offer, speak with your real estate lawyer first to understand the consequences of being unable to close. The deposit may be at risk and the seller may be entitled to sue you for damages if you cannot complete the purchase.
The Deposit: How It Works
The deposit is one of the most misunderstood elements of an Ontario home purchase. Understanding how it works protects both your funds and your position in the transaction.
How Much and When
In the GTA, deposits are typically 5% of the purchase price, though there is no fixed legal requirement. Smaller deposits (1% to 3%) are sometimes offered in slower markets, while larger deposits (10%) signal strong buyer commitment in competitive ones. The deposit is generally due within 24 hours of the seller’s acceptance of your offer, paid by certified cheque, bank draft, or wire transfer to the seller’s brokerage.
Where the Deposit Sits
The deposit is held in the seller’s real estate brokerage’s trust account, not by the seller personally. Brokerages are regulated by the Real Estate Council of Ontario (RECO) and must hold trust deposits in compliance with strict rules. The deposit earns interest payable to you (the buyer) once the trust period exceeds a threshold set by the brokerage.
What Happens to the Deposit
- If the deal closes: the deposit is credited toward the purchase price, reducing what you owe at closing.
- If the deal collapses on a satisfied condition: for example, financing falls through and the financing condition was properly invoked, your deposit is returned to you.
- If the deal collapses without grounds: if you waive all conditions and then fail to close, the seller may claim the deposit and pursue additional damages. The deposit cannot be unilaterally returned by the brokerage; it requires either a Mutual Release signed by both parties or a court order.
The Role of Your Real Estate Lawyer
A real estate lawyer is required for every residential real estate purchase in Ontario. Title cannot be transferred without a lawyer registering the documents through Ontario’s electronic land registration system (Teraview). Beyond that requirement, your lawyer plays a critical role in protecting you throughout the closing process.
What Your Lawyer Does Before Closing
- Reviews the Agreement of Purchase and Sale: to confirm the terms protect your interests, particularly if amendments have been made during negotiation.
- Reviews the status certificate (for condos): to identify any financial issues with the condo corporation, special assessments coming, or restrictive rules that might affect your use of the property.
- Conducts title searches: to confirm the seller actually owns the property, that there are no liens or encumbrances on title that should not be there, and that the property does not have outstanding tax arrears or other registered claims.
- Arranges title insurance: to protect you against title defects, fraud, and certain other risks that may not be discovered through searches.
- Coordinates with your mortgage lender: to receive the mortgage funds and register the mortgage on title at closing.
- Prepares the closing documents: including the transfer, mortgage, statement of adjustments (showing the exact amount due), and any other instruments required.
- Calculates the funds you need to bring to closing: your lawyer will tell you the exact amount, broken down by purchase price balance, land transfer tax, lawyer’s fees, and other adjustments.
What Your Lawyer Does on Closing Day
On closing day, your lawyer registers the transfer of title and the new mortgage electronically, receives and disburses the closing funds, pays the land transfer tax to the province, and arranges for you to receive the keys (typically through the seller’s lawyer or the seller’s brokerage). You generally do not need to attend closing in person, though you will sign closing documents in your lawyer’s office or virtually a few days before.
Land Transfer Tax: What You Will Pay
Ontario imposes Land Transfer Tax (LTT) on every purchase of real estate in the province. If you are buying within the City of Toronto, you also pay an additional Municipal Land Transfer Tax (MLTT). Both are payable on closing day and are calculated based on the purchase price.
Provincial Land Transfer Tax Rates (2026)
| Portion of Purchase Price | Rate |
| Up to $55,000 | 0.5% |
| $55,000 to $250,000 | 1.0% |
| $250,000 to $400,000 | 1.5% |
| $400,000 to $2,000,000 | 2.0% |
| Over $2,000,000 (residential) | 2.5% |
The tax is calculated using a marginal rate structure (the rate applies only to the portion of the price within each bracket). For a $900,000 home outside Toronto, provincial LTT is approximately $14,475.
Toronto Municipal Land Transfer Tax (MLTT)
If the property you are buying is within the boundaries of the City of Toronto (this does not include Mississauga, Brampton, Markham, Vaughan, or other GTA municipalities), you pay MLTT in addition to provincial LTT, calculated using a similar bracket structure. For a $900,000 home in Toronto, the combined provincial and municipal LTT is approximately $28,475.
First-Time Home Buyer Rebate
First-time home buyers in Ontario are eligible for a rebate of up to $4,000 on provincial LTT. Toronto first-time buyers are eligible for an additional MLTT rebate of up to $4,475. To qualify, you must be at least 18 years old, you must occupy the home as your principal residence within 9 months of closing, and you must not have owned a home anywhere in the world. If you are buying with a spouse, the rebate is reduced if your spouse has previously owned a home. Your real estate lawyer will apply for the rebate at closing on your behalf.
Closing Costs: Budget Beyond the Purchase Price
Many first-time buyers focus on the down payment and miss the substantial closing costs that come due on or before closing day. A reasonable rule of thumb is to budget 1.5% to 4% of the purchase price for closing costs in Ontario, with the upper end applying to Toronto purchases due to the additional MLTT.
Typical Closing Costs in Ontario
| Cost | Approximate Range |
| Provincial Land Transfer Tax | Calculated by purchase price (see brackets above) |
| Toronto Municipal Land Transfer Tax (Toronto only) | Roughly equal to provincial LTT |
| Lawyer’s fees and disbursements | $1,500 to $3,000 for a typical residential purchase |
| Title insurance | $300 to $500 (one-time) |
| Home inspection | $400 to $800 (paid before condition is waived) |
| Property tax adjustment | Varies; reimburses seller for prepaid taxes |
| Utility adjustments | Typically modest; reimburses seller for prepaid utilities |
| HST on new builds | 13% on the purchase price (largely offset by rebates for primary residence) |
| Mortgage default insurance (CMHC) if down payment under 20% | Added to mortgage; not paid out of pocket |
Your real estate lawyer will provide you with a Statement of Adjustments before closing showing exactly how much you need to bring to closing, accounting for the deposit already paid, the mortgage funds being advanced, and all closing costs.
Mortgage Approval and the Stress Test
Most home buyers in Ontario require a mortgage. Understanding what lenders look for and what tests apply will help you avoid a financing collapse during the conditional period.
Pre-Approval vs. Approval
A mortgage pre-approval is a lender’s preliminary indication that you can likely qualify for a mortgage of a certain amount, based on a soft review of your income and credit. It is not a binding commitment. After your offer is accepted, the lender conducts a full underwriting review of your application, including the property itself, your financials, and an appraisal. This is when financing can fall through, even if you were pre-approved. This is why a financing condition is so important.
The Mortgage Stress Test
Federally regulated lenders in Canada are required to apply a ‘stress test’ when approving residential mortgages. You must qualify for the mortgage at the higher of either the contract rate plus 2 percentage points, or the Bank of Canada’s qualifying rate (set quarterly). The stress test ensures you could continue to make payments if interest rates rise. A buyer who can comfortably afford their mortgage at today’s rate may still be denied if they cannot pass the stress test at the qualifying rate.
Down Payment Requirements
| Purchase Price | Minimum Down Payment |
| Up to $500,000 | 5% of purchase price |
| $500,000 to $1,000,000 | 5% on first $500,000, plus 10% on the portion over $500,000 |
| $1,000,000 to $1,500,000 | 5% on first $500,000, 10% on the portion between $500,000 and $1,500,000 |
| Over $1,500,000 | 20% minimum (no high-ratio mortgages permitted) |
If your down payment is less than 20% of the purchase price, you must obtain mortgage default insurance, typically through CMHC, Sagen, or Canada Guaranty. The insurance premium is added to your mortgage rather than paid up front.
Buying a Condominium in Ontario: Special Considerations
Condominiums in Ontario are governed by the Condominium Act and create unique legal considerations that do not apply to freehold purchases.
The Status Certificate
A status certificate is a package of documents that the condo corporation is legally required to provide on request, disclosing the financial and legal state of the condominium. This includes the condo’s reserve fund balance, current monthly fees, any planned special assessments, ongoing litigation, the declaration, by-laws, and rules. The standard Ontario APS includes a 10-day status certificate review condition. Your lawyer’s review of the status certificate is essential. A condo with an underfunded reserve fund or pending major repairs is a financial liability, and the status certificate is where these issues are revealed.
Common Elements and Exclusive-Use Areas
In a condominium, you own your unit but share ownership of the common elements (hallways, lobby, pool, gym) with all other unit owners through the condo corporation. Some areas, such as parking spaces, lockers, and balconies, may be exclusive-use common elements rather than part of your unit. The status certificate and condo declaration will tell you exactly what is included and what rules apply.
Pre-Construction Condos
Buying a pre-construction or ‘pre-build’ condo is legally different from buying a resale condo. Pre-construction APS agreements are heavily weighted in favour of the builder. You have a 10-day cooling-off period under the Condominium Act during which you can rescind the agreement without penalty. After that, you are bound by terms that include the builder’s right to delay closing, change unit specifications within limits, and charge various development fees. A real estate lawyer experienced with pre-construction purchases should review the agreement during the cooling-off period.
Buying a Home as a Newcomer or Multilingual Buyer
The GTA real estate market is one of the most multilingual in North America. For buyers whose first language is not English, the legal documents involved in a home purchase can be both technically complex and personally consequential. Working with a lawyer who speaks your language is not a luxury for first-time buyers in this position.
Foreign Buyer Restrictions
As of 2026, federal restrictions on the purchase of residential property by non-Canadians remain in place under the Prohibition on the Purchase of Residential Property by Non-Canadians Act. The restrictions apply to non-citizens and non-permanent residents, with certain exceptions for international students meeting specific criteria, refugee claimants, and individuals with valid work permits meeting specific work history requirements. Penalties include fines and forced sale of the property. If you are not a Canadian citizen or permanent resident and you are considering a home purchase, consult with a real estate lawyer before signing any agreement.
Non-Resident Speculation Tax (NRST)
Ontario imposes a 25% Non-Resident Speculation Tax on residential properties purchased anywhere in the province by foreign nationals, foreign corporations, and taxable trustees. There are limited rebates available for those who later become permanent residents within four years, and certain other narrow exemptions. For multilingual buyers who may be sponsoring family members or buying with non-resident relatives, the NRST is a significant consideration that requires legal advice well before signing an APS.
Why a Bilingual Real Estate Lawyer Matters
The closing documents in an Ontario real estate transaction, the transfer, mortgage, statement of adjustments, undertaking and direction, are dense and technical. Reviewing these in your second language under closing-day pressure is genuinely difficult. A bilingual real estate lawyer can walk you through each document in your first language, explain exactly what you are signing, and ensure you understand the financial implications before funds are released. Lawyers Who Speak connects GTA buyers with verified, Law Society of Ontario-licensed real estate lawyers who speak their language.
Frequently Asked Questions
How much do I need for a down payment to buy a home in Ontario?
In Ontario, the minimum down payment is 5% of the purchase price for homes priced at $500,000 or less. For homes priced between $500,000 and $1.5 million, the minimum is 5% on the first $500,000 plus 10% on the amount over that. Homes priced over $1.5 million require a minimum 20% down payment. If your down payment is less than 20%, you must obtain mortgage default insurance, which is added to your mortgage. Beyond the down payment, budget another 1.5% to 4% of the purchase price for closing costs.
Do I need a real estate lawyer to buy a home in Ontario?
Yes. In Ontario, only a lawyer can register the transfer of title and the new mortgage in the provincial land registration system. Beyond this legal requirement, a real estate lawyer protects you by reviewing the Agreement of Purchase and Sale, conducting title searches, arranging title insurance, reviewing the status certificate for condos, and ensuring that the transaction closes properly. Lawyer’s fees for a typical residential purchase in Ontario range from $1,500 to $3,000 inclusive of disbursements.
What is the difference between a freehold home and a condominium in Ontario?
A freehold home is one where you own both the structure and the land it sits on outright, with no shared ownership of common areas. Detached, semi-detached, and most townhouses are freehold. A condominium is a property where you own your individual unit and share ownership of common elements (hallways, lobby, amenities) with the other unit owners through a condo corporation. Condo ownership involves monthly maintenance fees and is governed by the Condominium Act, the corporation’s declaration, by-laws, and rules. The legal due diligence for a condo purchase, particularly the status certificate review, is more complex than for a freehold.
Can my offer be accepted and then the seller change their mind?
Once a seller has accepted your offer in writing, the Agreement of Purchase and Sale is a legally binding contract. The seller cannot simply change their mind. If the seller refuses to close, you (as the buyer) have legal remedies, including suing for specific performance (a court order forcing the sale to close) or for damages. Conversely, once you have waived all conditions, you are equally bound and cannot back out without consequences. This is why the conditional period and the conditions themselves are so important.
I am a first-time home buyer. What government programs can help me?
Ontario first-time home buyers have access to several programs. The Land Transfer Tax Rebate refunds up to $4,000 in provincial LTT, plus an additional $4,475 in Toronto MLTT for qualifying Toronto buyers. The federal First Home Savings Account (FHSA) lets you save up to $40,000 toward your down payment with tax advantages. The Home Buyers’ Plan allows you to withdraw up to $35,000 from your RRSP toward your down payment without immediate tax consequences. The federal First-Time Home Buyer Incentive was discontinued in 2024. To qualify for first-time buyer programs, you generally must not have owned a home anywhere in the world, and the purchased home must be your principal residence.
Find a Real Estate Lawyer in the GTA Who Speaks Your Language
Buying a home is one of the most significant transactions you will ever make. Having a real estate lawyer who can explain every document and every step in your first language can make a meaningful difference in your understanding and confidence throughout the transaction.
Lawyers Who Speak connects GTA home buyers with verified, Law Society of Ontario-licensed real estate lawyers who speak their language. Search by language and practice area to find a qualified real estate lawyer near you.
Disclaimer: This article is for informational purposes only and does not constitute legal advice. Real estate transactions are fact-specific and the law can change. If you are planning to buy a home in Ontario, please consult a qualified real estate lawyer licensed in Ontario for advice specific to your situation.
