How Much Does It Cost to Downsize in Toronto? Every Fee, Tax, and Hidden Charge

By Jacquie Othen, SRES  |  April 2026  |  9 min read

I want to tell you something that surprises most people when they sit across from me at the kitchen table. They've already done the math on their equity, thought through what a smaller place might look like, and have a rough idea of what they want to net from the sale. What they haven't done is a full accounting of what it costs to get from here to there.

It's not one big number. It's a collection of fees, taxes, and charges that accumulate on both sides of the move. Some of them are unavoidable. Some can be planned around. And one, the double land transfer tax Toronto buyers pay, genuinely shocks people when they first see it.

This post walks through every cost in plain language, with real numbers. Nothing here is invented or estimated from thin air. Each figure is sourced from current Ontario government rates, industry data, or verified ranges from Toronto legal and moving professionals. I'll also work through a concrete example so you can see how the full picture adds up for a typical downsizing move in Toronto.

The Selling Side: What It Costs to Sell Your Home

Before you see a dollar of your equity, transaction costs are deducted first. Here's what you're looking at.

Real Estate Commission

Commission is the largest single cost in a home sale. In Ontario, commission is typically 5% of the sale price, split as 2.5% to the listing agent and 2.5% to the buyer's agent, though the rate can vary based on the services included. HST of 13% applies on top.

At 5% plus HST on a $1.2 million sale, that's $60,000 in commission and $7,800 in tax, for a total of $67,800. That's real money, and it's the first thing to understand going in. The commission covers both agents, yours and the buyer's, and it's paid from your sale proceeds at closing, not out of pocket.

Commission is negotiable. What isn't negotiable, in my experience, is the correlation between what you offer the buyer's agent and how many agents prioritize showing your home. If you cut the buyer's side significantly, you can reduce the pool of buyers you're reaching. Something to think through carefully with your agent before signing a listing agreement. If you want to understand what's included in a full-service listing, our Why List With Us page walks you through it.

Legal Fees (Seller Side)

You need a real estate lawyer to close the sale. Seller legal fees in Ontario typically range from $1,000 to $2,000, plus disbursements of $300 to $600 for document preparation and registrations. Budget $1,500 to $2,500 all in for the sell side.

Mortgage Discharge

If you have a mortgage on your home, it must be paid off when you sell. This comes in two forms, each with a very different price tag.

The administrative discharge fee, which is just the cost of removing the lender's charge from your title, is usually between $0 and $400 from the lender, plus any legal or land registry costs. That's manageable.

The prepayment penalty is a different matter. The penalty to break a variable-rate mortgage is typically three months' interest. For a fixed-rate mortgage, the penalty is the greater of three months' interest or the Interest Rate Differential, which compensates the lender for the difference between your rate and what they can lend at today. On a fixed-rate mortgage with a meaningful balance and several years left on the term, that IRD penalty can run into the tens of thousands.

Before you commit to a sale timeline, call your lender and ask for a payout statement. They'll tell you exactly what the penalty is at your target closing date. This one call can save you a very unpleasant surprise. Some people time their sale to coincide with their renewal date and avoid the penalty entirely. It's worth the conversation.

If you have no mortgage or are at renewal, this cost is zero.

Selling Cost Summary

Cost Item	Typical Range
Real estate commission (typically 5% + HST, may vary)	~5.65% of the sale price, all in
Seller legal fees + disbursements	$1,500 – $2,500
Mortgage discharge (admin only)	$200 – $400
Mortgage prepayment penalty (if applicable)	$0 to $10,000+

The Buying Side: What It Costs to Purchase Your Next Home

Once the proceeds from the sale land, the costs start again on the purchase. The biggest item here is one most people haven't carefully considered: the double land transfer tax. If you're still weighing what kind of property to buy, our guide to right-sizing your home in Toronto is worth reading before you narrow down your options.

Toronto's Double Land Transfer Tax

This is the cost that surprises people most. Toronto home buyers must pay both the Ontario provincial Land Transfer Tax and the Toronto Municipal Land Transfer Tax. Both are marginal taxes, meaning each portion of your purchase price is taxed at its own rate.

Ontario uses a sliding scale system where the more expensive your property, the higher the percentage you pay on that portion. Toronto's rates mirror Ontario's structure, applied on top of the provincial tax. That's nearly double what you'd pay in other Ontario municipalities.

Here's how the brackets work for a typical downsizing purchase in Toronto. Both the provincial and municipal taxes use the same rate structure on the same dollar amounts, so you're effectively paying each bracket twice:

Purchase Price Portion	Provincial Rate	Municipal Rate
Up to $55,000	0.5%	0.5%
$55,001 – $250,000	1.0%	1.0%
$250,001 – $400,000	1.5%	1.5%
$400,001 – $2,000,000	2.0%	2.0%

On a $750,000 condo purchase in Toronto, the Ontario LTT comes to $11,475, and the Toronto MLTT adds another $11,475. Total land transfer tax: $22,950. That's before legal fees or anything else.

One important note: the land transfer tax is a buyer's cost, not a seller's. The buyer of a home pays the land transfer tax. Sellers do not pay land transfer tax on the property they're selling. So this entire cost sits on the purchase side of your move.

Also worth knowing: as of April 1, 2026, the Toronto City Council has introduced new graduated MLTT rates for high-value residential properties. These higher rates apply to properties over $3 million and won't affect most downsizing moves, but if you're considering a luxury condo purchase, talk to your lawyer about the current schedule.

Legal Fees (Buyer Side)

Legal fees for a standard residential purchase in Ontario typically range from $1,000 to $2,500, depending on the complexity of the transaction and the law firm you choose. Condo purchases add a status certificate review, which can push fees toward the higher end. Budget $1,500 to $2,500 plus disbursements.

Title Insurance

Title insurance protects you against ownership disputes, fraud, errors in public records, and similar issues. It's a one-time cost of $200 to $400, arranged by your lawyer. Most lenders require it, and it's worth having even if you don't.

Buying Cost Summary

Cost Item	Typical Range
Ontario Land Transfer Tax ($750K purchase)	$11,475
Toronto Municipal Land Transfer Tax ($750K purchase)	$11,475
Total Land Transfer Tax	$22,950
Buyer legal fees + disbursements	$1,500 – $2,500
Title insurance	$200 – $400

Moving Costs

Moving costs are genuinely variable, but the ranges for Toronto local moves are well documented. On average, you can expect to pay $1,500 to $1,750 for a 3-bedroom move and $1,100 to $1,400 for a 2-bedroom move. Movers in Toronto generally charge an hourly rate between $120 and $200, and rates tend to increase during peak seasons, such as summer and weekends.

If you're moving from a 3-bedroom family home into a 1 or 2-bedroom condo, your move involves more than just a truck. It involves decisions: what comes with you, what goes to family, what gets donated, and what gets stored. Some people bring in a professional organizer or a senior move manager to help with the process. That's an additional cost, typically $50 to $100 per hour, and for a large family home, it can add up to $500 to $1,500 depending on how much help you want. It's money well spent if it keeps the process from becoming overwhelming. Our post on the Toronto downsizing timeline covers exactly when to start thinking about sorting and moving logistics relative to your listing date.

One thing I always tell clients: book movers early, especially if you're targeting a spring or early summer closing. The good companies fill up fast, and the last thing you want is to close on a Friday in June with no confirmed mover.

The Full Picture: A Real Example

Simply put, the best way to understand what downsizing costs is to run the numbers on a real scenario. Here's what the math looks like for a homeowner selling a $1.2 million house in Toronto and buying a $750,000 condo.

Cost Item	Amount
Commission on sale (5% + HST)	$67,800
Seller legal fees + disbursements	$1,750
Mortgage discharge (admin, no penalty)	$300
Ontario Land Transfer Tax on $750K purchase	$11,475
Toronto MLTT on $750K purchase	$11,475
Buyer legal fees + disbursements	$2,000
Title insurance	$300
Local moving costs (mid-range estimate)	$2,000
Total transaction costs	~$97,100

That figure assumes no mortgage prepayment penalty. If there's an active fixed-rate mortgage on the house being sold, that number could be meaningfully higher. It also assumes professional staging is included in the listing service, as it is with our team, so there's no separate staging line item.

The equity position in this scenario remains strong. A homeowner selling $1.2 million and buying $750,000 frees up $450,000 in principle, less roughly $97,000 in transaction costs, leaving approximately $353,000 in net proceeds above the new purchase before any mortgage balance considerations. For most of the families I work with, that's a transformational shift in their financial picture and lifestyle. You can read more about how to frame that full equity calculation in our post on how to calculate what you'd net from downsizing your Toronto home.

What Downsizing Saves You

The costs above are real, but they're a one-time event. What changes permanently on the other side is worth noting alongside those numbers.

Property taxes on a $750,000 condo are meaningfully lower than on a $1.2 million house. Maintenance costs drop. Insurance drops. Utilities drop. If you're moving into a condo, your major repair exposure essentially disappears, since the condo corporation handles the building envelope, roof, and systems. Many of the clients I work with find that their monthly carrying costs drop by $1,000 to $2,000 or more. Over five years, that's $60,000 to $120,000 in savings that don't show up in the transaction cost column but absolutely belong in the full financial picture.

There's also the equity you've freed up. Capital sitting in a home doesn't generate income. When it's in your hands, it can. Our seniors real estate services page covers how we think about this transition as part of a broader financial and lifestyle plan, which is worth reading if this is the kind of move you're contemplating.

Five Things That Affect Your Final Cost Number

The ranges above are solid starting points, but your actual costs will depend on these variables:

• Whether you're inside or outside Toronto's city limits, on the purchase side. If you buy in Mississauga, Vaughan, or Richmond Hill, you pay only the Ontario provincial LTT, not the municipal tax. That saves you $11,475 on a $750,000 purchase. Some clients find that this meaningfully changes the neighbourhood conversation. We work across Leaside, Don Mills, Yonge and Eglinton, Lawrence Park, and The Beaches, and can help you think through which neighbourhoods make sense for your budget and lifestyle.
• Whether you have an active fixed-rate mortgage. The prepayment penalty on a fixed-rate mortgage can range from a few thousand dollars to significantly more, depending on your balance, rate, and remaining term. Get the exact figure from your lender before committing to a timeline.
• Your sale price. Commission is a percentage, so every additional $100,000 in sale price adds roughly $5,650 to your commission line (5% plus HST).
• Whether you're selling a condo or a house. Sellers of condos need to provide a status certificate, which costs approximately $150. That's minor, but it's part of the picture.
• The size and complexity of your move. A larger home, more specialty items, or an out-of-season move that requires storage will all increase moving costs.

Frequently Asked Questions

Do sellers pay land transfer tax when they sell their home in Toronto?

No. The land transfer tax in Ontario is paid by the buyer, not the seller. When you sell your home, you don't pay land transfer tax on that transaction. However, if you're downsizing and purchasing a new property, you will pay land transfer tax as the buyer. In Toronto, that means paying both the provincial Ontario LTT and the Toronto Municipal LTT on the same purchase price.

How much is the land transfer tax on a $750,000 condo in Toronto?

On a $750,000 purchase inside the City of Toronto, the Ontario provincial Land Transfer Tax is $11,475, and the Toronto Municipal Land Transfer Tax is also $11,475, for a combined total of $22,950. Both taxes use the same marginal rate structure, so buyers inside Toronto effectively pay the provincial rate twice. If you purchased the same condo in Mississauga or another GTA municipality outside Toronto's boundaries, you would only pay the provincial tax of $11,475.

What is the average real estate commission in Ontario when selling a home?

In Ontario, commission is typically 5% of the sale price, split as 2.5% to the listing agent and 2.5% to the buyer's agent, plus 13% HST on the total commission. The rate can vary based on the services included. On a $1.2 million home, the standard 5% commission works out to $60,000 plus $7,800 in HST, for a total of $67,800. The HST applies to the commission itself and cannot be avoided.

Can I avoid the mortgage prepayment penalty when downsizing?

Yes, in some cases. If your mortgage term is coming up for renewal, you can time your sale to coincide with the renewal date and avoid the penalty entirely. Some lenders also offer mortgage portability, which allows you to transfer your existing mortgage to your new property, avoiding or reducing the penalty. If neither option applies, ask your lender for a payout statement at your target closing date before you commit to a timeline. On a fixed-rate mortgage with several years remaining and a low contract rate, the Interest Rate Differential penalty can be substantial. Knowing the exact number before you sign a listing agreement lets you plan properly.

How much do movers cost in Toronto for a local move?

Local moving costs in Toronto depend on the size of your home and the services included. A two-bedroom move typically runs $1,100 to $1,400, while a three-bedroom move generally costs $1,500 to $1,750 for a standard local move without packing services. Movers charge hourly rates, typically $120 to $200 per hour for a two-mover team, and summer and weekend moves cost more due to higher demand. If you want full packing services included, budget an additional $500 to $1,200, depending on the volume of your home. Most Toronto moving companies also require a minimum of three hours for any booking.

What are the total costs to downsize from a house to a condo in Toronto?

For a homeowner selling a $1.2 million house and buying a $750,000 condo in Toronto, total transaction costs run approximately $95,000 to $100,000, assuming no mortgage prepayment penalty. This includes commission on the sale (the largest item), land transfer tax on both sides of the move, legal fees for selling and buying, title insurance, and moving costs. The double land transfer tax in Toronto adds roughly $22,950 to the purchase side of the move. If there is an active fixed-rate mortgage on the property being sold, the prepayment penalty can add several thousand dollars or more, depending on the remaining term and balance.

Is it worth downsizing in Toronto, even after accounting for the costs?

For most homeowners, yes. The transaction costs are real and should be carefully planned for, but they are a one-time expense. On the other side, most downsizers find their monthly carrying costs drop by $1,000 to $2,000 or more, depending on the size difference between the properties. Property taxes, maintenance costs, insurance, and utilities all decrease, and moving into a condo removes most large repair exposure entirely. The equity released by the price difference between the sold and purchased properties is often the more significant factor. Many Toronto homeowners find that downsizing unlocks several hundred thousand dollars in equity while significantly reducing their ongoing costs. Working through those numbers in detail before making a decision is exactly what our Toronto downsizing team is here to help with.