The TL;DR Takeaway
- Budget 1.5% - 4%: Always keep liquid cash for closing costs.
- Claim LTT Refund: New Home Buyers get up to $4,000 back.
- New HST Rebates: Massive tax relief for new builds in 2026 up to $1 million.
Most New Home Buyers in Ontario spend months obsessing over their down payment and monthly mortgage rates. While those are the biggest hurdles, many are caught off guard by the "final bill"—the closing costs. In Ontario, you should generally budget between 1.5% and 4% of the purchase price for these additional expenses.
1. The Ontario Land Transfer Tax (LTT) Refund
In Ontario, every time land changes hands, the buyer pays a Land Transfer Tax. This is often the largest single closing cost. However, if you are a New Home Buyer, you likely qualify for a refund of up to $4,000.
- How it works: On a home priced at $368,000 or less, the refund covers the provincial LTT entirely.
- Higher Prices: For a typical home in the Waterloo Region or the GTA, you will still receive the full $4,000 credit, simply deducted from the total tax owed.
2. The HST Rebate Overhaul: What 2026 Housing Legislation Changed
If you are purchasing a brand-new build or a pre-construction condo with a closing date after March 19, 2025, the federal tax landscape has been completely restructured by 2026 Housing Legislation.
- Federal GST Rebate (Post-March 20, 2025): The full 100% GST rebate now applies to qualifying new homes up to $1,000,000, phasing out at $1,500,000. Previously, the rebate phased out entirely at $450,000 — making it useless for virtually every Ontario buyer.
- Ontario Provincial Rebate: Ontario currently provides a 75% rebate on the 8% PST portion, capped at $24,000. The province has signalled an intent to align with the federal expansion, though no provincial legislation has passed as of early 2026.
- Net Potential Savings: On a $900,000 new build, the combined federal GST rebate and existing provincial rebate can total up to $69,000 in tax relief — a dramatic improvement over the pre-C-4 maximum of roughly $30,300.
3. Essential Closing Cost Checklist
| Expense | Estimated Cost (2026) | Why You Need It |
|---|---|---|
| Legal Fees & Disbursements | $1,200 – $1,800 | Title transfer, title search, mortgage registration. |
| Title Insurance | $400 – $900 | Protects from title fraud or existing work orders. |
| PST on CMHC Premium | 8% of premium | If down payment is <20%, pay PST upfront outside the mortgage. |
| Statement of Adjustments | $500 – $1,500 | Reimbursing seller for prepaid taxes/utilities. |
| Appraisal Fee | $300 – $500 | Lender requirement to confirm home's value. |
4. Maximize Your "First Home" Incentives
To keep closing day stress-free, leverage every tool: FHSA contributions, Home Buyers' Plan (HBP) $60k withdrawal, and the $10,000 Tax Credit resulting in $1,500 tax relief.