Costs of Selling a Home in Alliston Ontario
Understand the true costs of selling your house — from real estate commissions and legal fees to staging, mortgage penalties, and closing expenses.
Guide Contents
Selling a home in Alliston is a major financial transaction, and if you only focus on the sale price, the closing costs can come as an unwelcome surprise. In my 30+ years of helping sellers in New Tecumseth, I've seen homeowners shocked by mortgage prepayment penalties or confused about who pays the land transfer tax. The key to a stress-free move is knowing exactly what you will net after all expenses are paid.
In Ontario, home sellers typically pay between 4% and 7% of the final sale price in closing costs. The largest portion is real estate commission, but you also need to budget for legal fees, potential mortgage discharge penalties, and pre-listing preparations. This guide breaks down every expense you might encounter so you can calculate your true net proceeds.
People Also Ask: Alliston Selling Costs
Who pays the Realtor commission in Ontario?
In almost all cases, the seller pays the commission for both their listing agent and the buyer's agent. The total commission is deducted from the sale proceeds by your real estate lawyer on closing day.
Who pays the land transfer tax?
The buyer pays the land transfer tax in Ontario. As a seller in Alliston, you are not responsible for paying land transfer tax when you sell your property.
Do I pay capital gains tax on my home?
If the home was your principal residence for the entire time you owned it, you do not pay capital gains tax when you sell. You must still report the sale on your tax return to claim the principal residence exemption.
Do I need a new survey to sell?
You do not legally need a new survey to sell a house in Ontario. Most buyers accept existing surveys or use title insurance to protect against boundary issues.
Is HST charged on closing costs?
Yes, 13% HST is charged on services like real estate commissions, legal fees, and moving costs. It is not charged on the sale price of a resale home or on mortgage penalties.
Real Estate Commissions in Ontario
Real estate commission is almost always the single largest expense when selling a home. In Ontario, the combined commission typically ranges from 4% to 5% of the final sale price, plus 13% HST.
How Commission is Split
The total commission you agree to is generally split between two brokerages:
- The Listing Brokerage: This portion compensates your agent for marketing the property, coordinating showings, negotiating offers, and managing the transaction. For my clients, this includes our proprietary Video Narrated VR Animated Online Showings, professional photography, and extensive online syndication.
- The Buyer's Brokerage: This portion (often 2.5%) is offered to incentivize other agents to bring their qualified buyers to your property.
It is crucial to remember that HST applies to real estate commissions. If you sell an $800,000 home with a 5% total commission ($40,000), the HST adds another $5,200. The total $45,200 is deducted from your proceeds by your lawyer on closing day.
How to Get Top Dollar for Your House
A backstage tour of the seller marketing plan, showing how Video Narrated VR Animated Online Showings highlight all of a home's key features and benefits online — where buyers shortlist homes they are willing to go see.
Legal Fees and Disbursements
You must have a real estate lawyer to legally transfer property ownership in Ontario, as only legal professionals have access to the Teraview land registry system.
What Real Estate Lawyers Charge
Legal costs for sellers typically range from $1,200 to $2,000 plus HST. This total is broken down into two parts:
- The Legal Fee: The lawyer's base rate for their professional time (usually $800 to $1,500).
- Disbursements: Out-of-pocket expenses the lawyer pays on your behalf, such as title searches, execution certificates, courier fees, and bank wire charges (usually $300 to $600).
Your lawyer plays a vital role. They review the Agreement of Purchase and Sale, prepare the Statement of Adjustments, coordinate with your lender to discharge your mortgage, and ensure you receive your net proceeds securely on closing day.
Free Download: The Complete Home Selling Costs Checklist
Don't let hidden fees surprise you on closing day. Download my comprehensive PDF checklist covering commission breakdowns, legal preparation, closing adjustments, and a net proceeds worksheet.
Download the Free PDFMortgage Discharge Fees and Prepayment Penalties
If you still owe money on your mortgage, discharging it can be inexpensive or surprisingly costly, depending on your mortgage terms.
Standard Discharge Fees
If your mortgage term is ending on or before your closing date, or if you have an open mortgage, you will typically only pay a standard lender administrative discharge fee, which ranges from $200 to $400.
Prepayment Penalties
If you are breaking a closed mortgage before the term is up, you will face a prepayment penalty. This is one of the most frequently overlooked costs of selling a home in Alliston.
- Variable Rate Mortgages: The penalty is typically capped at three months' interest.
- Fixed Rate Mortgages: The penalty is usually the greater of three months' interest or the Interest Rate Differential (IRD). The IRD calculates the difference between your original interest rate and current market rates for the remainder of your term. If rates have dropped since you got your mortgage, the IRD penalty can run into the thousands or even tens of thousands of dollars.
Kevin's Advice: Always call your lender before listing your home and ask for a payout statement with the exact penalty calculation. If you are buying another property, ask if you can "port" your mortgage to the new home to avoid the penalty entirely.
Pre-Sale Preparation and Staging Costs
While not strictly "closing costs," preparing your home for the market requires an upfront investment. Preparing your home for sale in Alliston strategically ensures you get the highest possible return on investment.
Home Staging
Professional staging helps buyers visualize themselves in the space. While a consultation might cost $300 to $600, full vacant home staging typically costs $2,000 to $5,000+ per month, depending on the size of the home. However, my team utilizes technology to show rooms both with and without furniture during our Video Narrated VR Animated Online Showings, which can often reduce the need for expensive physical staging rentals.
Pre-Listing Inspections
A pre-listing home inspection costs between $350 and $600. I often recommend this for older homes or rural properties. Providing a clean inspection report builds buyer trust and often prevents them from including their own inspection condition, leading to a firmer, faster deal.
Rural Property Specifics (Septic and Well)
If you are selling a rural property outside of town, buyers will scrutinize your private systems. You should budget $300 to $600 to have your septic tank pumped and inspected before listing. You should also ensure you have recent, clean well water tests. Learn more in our guide to septic and well homes in New Tecumseth.
The Statement of Adjustments
On closing day, your lawyer will prepare a Statement of Adjustments. This document ensures that you only pay for the expenses related to the days you actually owned the home.
| Expense Type | How It Is Adjusted |
|---|---|
| Property Taxes | If you prepaid taxes for the year, the buyer credits you for the days they own the home. If you are in arrears, the amount owed is deducted from your proceeds. |
| Condo Fees | If you are selling a condo in Alliston, monthly maintenance fees are prorated to the exact closing date. |
| Propane/Oil Tanks | For rural properties, the buyer typically reimburses you for the value of the fuel remaining in the tank on closing day. |
| Status Certificate | Condo sellers must provide a Status Certificate to the buyer. In Ontario, condo corporations charge a maximum of $100 (plus potential rush fees) for this document. |
Tax Considerations: HST and Capital Gains
Understanding your tax obligations is critical when calculating your net proceeds.
Capital Gains Tax
If the property was your principal residence for every year you owned it, you are exempt from capital gains tax under the Principal Residence Exemption. You keep 100% of the equity. However, you must still report the sale on your income tax return.
If the property was an investment, a rental, or a secondary home (like a cottage), you will owe capital gains tax. The CRA treats 50% of the gain (the difference between your purchase price and sale price, minus eligible expenses) as taxable income. Note that rules changed in 2023: properties bought and sold within 365 days may have the entire gain taxed as business income to deter "flipping."
HST (Harmonized Sales Tax)
You do not charge or pay HST on the sale price of a used residential home. However, you must pay 13% HST on the services associated with selling, including real estate commissions, legal fees, home staging, and moving company costs.
10 Questions You Should Ask Before Hiring A REALTOR
Essential questions to evaluate any agent before signing.
Why Didn't My House Sell?
Common reasons homes sit on the market too long.
How to Avoid Legal Mistakes When Selling Your House
Protect yourself from costly legal pitfalls during the sale.
How Do I Know My House Will Pass the Building Inspection?
What inspectors look for and how to prepare.
What Sellers Say About the Flaherty Team
"From our first sit down with Kevin, his vast experience and professionalism were apparent. We interviewed several realtors and went with Kevin and his team because of his unique marketing strategy in this age of technology. Our home was advertised on many platforms. The 3-D virtual walk through the team created was exceptional. Potential buyers got a very accurate depiction of the property and home. Rooms were shown both furnished and unfurnished, and accurate blueprints with detailed room measurements were provided to assist interested shoppers. Kevin and his team answered any questions and requests in a timely manner and provided the sound advice needed to get our property sold for full asking price in a difficult market. What more could you ask for?"
"The property was listed and sold with second viewing within two days at more than the asking price. The closing dates of this place and the new purchase matched perfectly. Kevin and his team were the epitome of skill and efficiency."
"Kevin explained the process clearly, kept us informed every step of the way, and got us more than we expected."
Read more verified seller reviews at flaherty.ca/reviews.
Frequently Asked Questions About Selling Costs
What are the total closing costs for a seller in Alliston?
The total closing costs for a seller in Alliston typically range from 4% to 7% of the home's final sale price. This total includes real estate commissions (the largest portion), legal fees, HST on services, and potential mortgage discharge penalties. Kevin Flaherty helps sellers budget accurately; on an $800,000 home, you should set aside approximately $35,000 to $50,000 for total expenses.
Who pays the Realtor commission in Ontario?
In almost all residential real estate transactions in Ontario, the seller pays the commission for both the listing agent and the buyer's agent. The total commission is deducted from the proceeds of the sale by the seller's lawyer on closing day and distributed to the respective brokerages.
Is Realtor commission negotiable in Ontario?
Yes, real estate commissions are negotiable in Ontario. There is no legally fixed or "standard" rate. However, Kevin Flaherty reminds sellers that you get what you pay for; a discounted commission often means discounted marketing, which can result in a lower final sale price that costs you more than the commission savings.
Who pays the land transfer tax when selling a house?
The buyer pays the land transfer tax in Ontario. As a seller, you do not pay any land transfer tax when you sell your home, regardless of whether you are selling in Alliston, Beeton, or Tottenham.
Do I pay capital gains tax if I sell my principal residence?
No. If the property was your principal residence for the entire time you owned it, you are exempt from capital gains tax. However, you must still report the sale on your income tax return to claim the principal residence exemption.
What happens if I break my mortgage early to sell?
If you break a closed mortgage before the term expires, your lender will charge a prepayment penalty. For fixed-rate mortgages, this is usually the greater of three months' interest or the Interest Rate Differential (IRD). Kevin Flaherty strongly advises sellers to request a payout statement from their lender before listing to avoid multi-thousand-dollar surprises.
How much do real estate lawyers charge for selling a house?
Real estate lawyers in Ontario typically charge between $1,200 and $2,000 to handle a home sale. This includes their base legal fee plus disbursements (out-of-pocket costs like title searches and courier fees), plus 13% HST.
Is HST charged on closing costs?
Yes, 13% HST is charged on services related to selling your home, including real estate commissions, legal fees, staging, and moving costs. It is not charged on the sale price of a resale home itself, nor is it charged on mortgage prepayment penalties.
Do I need to pay for a new survey to sell my home?
No, you do not legally need a new survey to sell a house in Ontario. Most buyers will accept an existing survey if you have one, or their lawyer will arrange for title insurance to protect against boundary issues.
How much does it cost to get a condo status certificate?
In Ontario, the maximum fee a condominium corporation can charge for a standard Status Certificate is $100 (inclusive of taxes). The corporation has up to 10 days to provide it. If you need it expedited, they may charge an additional rush fee.
Should I pay for a pre-listing home inspection?
Kevin Flaherty often recommends a pre-listing inspection, which costs between $350 and $600. Providing a clean report to buyers builds trust and often eliminates their need to include an inspection condition, leading to a firmer, faster offer.
How much does it cost to stage a house in Alliston?
Professional vacant home staging can cost between $2,000 and $5,000+ per month. However, Kevin Flaherty's marketing team uses advanced technology to show rooms both furnished and unfurnished during online showings, which can often save sellers the cost of physical furniture rentals.
What are the costs of selling a rural property with a septic system?
If you are selling a rural property, buyers will expect the septic system to be in good working order. You should budget $300 to $600 to have the tank pumped and inspected before listing to reassure buyers and avoid aggressive price renegotiations.
How are property taxes handled on closing day?
Your lawyer will handle property taxes on the Statement of Adjustments. If you have prepaid your taxes past the closing date, the buyer will credit you for the overpayment. If you are behind on taxes, the amount owed will be deducted from your sale proceeds.
How much does it cost to hire movers in Ontario?
The cost of a local move in Ontario typically ranges from $1,000 to $3,000 depending on the size of your home, the distance, and whether you require packing services. Kevin Flaherty recommends getting multiple quotes from reputable moving companies well before your closing date.
Do I need to pay for title insurance as a seller?
Generally, no. Title insurance is almost always purchased by the buyer to protect their new ownership rights and their lender. The seller's lawyer ensures the title is clear before transfer, but the buyer bears the insurance cost.
What is a mortgage discharge fee?
A mortgage discharge fee is a standard administrative fee charged by your lender to remove their name from your property's title once the mortgage is paid off. It typically ranges from $200 to $400 and is separate from any early prepayment penalties.
Can I deduct closing costs from my income taxes?
If the home was your principal residence, the profit is tax-free, meaning you cannot deduct closing costs. If the property was an investment or rental, your closing costs (like commissions and legal fees) can be deducted from your capital gains to reduce your tax burden.
How do I calculate my exact net proceeds?
To calculate your net proceeds, take your expected sale price and subtract the real estate commission (plus HST), legal fees, mortgage discharge fees and penalties, and any outstanding mortgage balance. Kevin Flaherty provides sellers with a detailed net sheet before listing so there are no surprises.
What if my house appraises for less than the sale price?
If the buyer's appraisal comes in low, their lender may not approve the full mortgage amount. The buyer may ask you to lower the price, or they may have to make up the difference in cash. Pricing the home accurately from the start is the best defense against appraisal issues.
Does a long closing date cost me more money?
A long closing date means you continue to pay the carrying costs of the home (mortgage interest, property taxes, utilities, and insurance) until the closing day. While it doesn't increase your closing fees, it does increase your holding costs.
Should I offer a buyer agent commission if I sell privately?
Yes. If you attempt to sell privately (FSBO), you should still offer a cooperating commission (typically 2% to 2.5%) to buyer agents. If you don't, agents have no financial incentive to show your property to their qualified buyers, severely limiting your exposure.
How much does it cost to fix a house before selling?
Repair costs vary wildly, but Kevin Flaherty advises sellers to focus only on repairs that offer a positive return on investment. Fresh paint, decluttering, and fixing obvious defects (like a leaky faucet) are cost-effective. Major renovations right before selling rarely recoup their full cost.
Are there hidden costs to selling a home?
The most common "hidden" costs that catch sellers off guard are mortgage prepayment penalties (especially IRD on fixed mortgages), the 13% HST applied to the real estate commission, and the cost of resolving unexpected issues found during the buyer's home inspection.
New Tecumseth Community Pages
About Kevin Flaherty
Kevin Flaherty has been helping Alliston and New Tecumseth sellers understand their true net proceeds since 1988. With over 30 years of experience, Kevin ensures sellers are never surprised by hidden closing costs.
The Flaherty Team sells homes for 99.2% of market value and 52% faster than average agents. Their proprietary marketing system — including Video Narrated VR Animated Online Showings, professional photography, and drone footage — is fully included in his service, ensuring maximum exposure without extra marketing costs to the seller.
Call Kevin directly at 226-270-6433 to discuss your property.
Net Proceeds Calculator
Use this calculator to estimate your costs and net proceeds from selling your Alliston home. This is for planning purposes only — your actual numbers will depend on your specific property, mortgage, and professional fees. For a precise estimate, book a free home evaluation with Kevin.
