Steps to Buying a House in Ontario: A Complete Step-by-Step Guide

Buying a home in Ontario involves more moving parts than most people expect. It’s not just about finding a house you like and signing a cheque. There are mortgage approvals, legal searches, government taxes, insurance deadlines, and a closing process where hundreds of thousands of dollars move between lawyers’ trust accounts in a single afternoon.

If you’re a first-time buyer, the entire process can feel overwhelming. If you’ve bought before, you know it’s stressful even when you know what’s coming. This guide walks through every step of buying a house in Ontario — from the moment you start thinking about your budget to the moment you pick up the keys — so you know exactly what happens, when it happens, and who’s responsible for each part.

Step 1: Figure Out What You Can Actually Afford

Before you start looking at listings, you need a realistic number. That starts with a mortgage pre-approval. A mortgage broker or bank lender reviews your income, debts, credit score, and down payment savings to tell you exactly how much they’re willing to lend you.

A pre-approval is not a guarantee — it’s a conditional commitment that’s typically valid for 90 to 120 days. But it gives you two critical things: a maximum purchase price to guide your search, and a locked-in interest rate that protects you if rates go up while you’re shopping.

Remember that the purchase price is not your total cost. On top of the mortgage, you’ll need cash for:

• Down payment: Minimum 5% for homes under $500,000, 10% on the portion between $500,000 and $999,999, and 20% for homes $1 million or more.
• Land transfer tax: In Ontario, this is a marginal tax ranging from 0.5% to 2.5% depending on the price. Toronto buyers pay a second municipal land transfer tax on top of the provincial one.
• Closing costs: Legal fees, title insurance, home inspection, adjustments for prepaid property taxes and utilities — typically $7,000 to $15,000 in total.

Step 2: Hire a Real Estate Agent

Your agent is the person who shows you properties, writes your offers, and negotiates on your behalf. In Ontario, the buyer does not pay the real estate agent’s commission directly — it comes out of the seller’s proceeds at closing. However, as of December 2024, new CREA rules require buyers to sign a Buyer Representation Agreement before their agent can show them properties. This agreement outlines the agent’s commission structure and your obligations.

Choose an agent who knows the specific neighbourhood you’re targeting. A good agent will pull comparable sales data, advise you on realistic offer prices, and warn you about red flags before you commit.

Step 3: Start House Hunting

With your pre-approval in hand and your agent on board, you start viewing properties. In the GTA, most buyers browse listings on Realtor.ca, HouseSigma, or Zolo, then book viewings through their agent.

As you view properties, pay attention to more than the paint and the staging. Look at the foundation, the roof condition, the windows, the age of the furnace and electrical panel. Your agent should flag any properties that show signs of deferred maintenance or unpermitted renovations.

Step 4: Make an Offer (The Agreement of Purchase and Sale)

When you find a home you want, your agent drafts an Agreement of Purchase and Sale (APS). This is the legal contract between you and the seller. It includes:

• The offer price
• The deposit amount (typically 2–5% of the purchase price, submitted within 24 hours of acceptance)
• The closing date (the day you take legal ownership and get the keys)
• Conditions (also called “subject to” clauses — most commonly a financing condition, a home inspection condition, and a lawyer review condition)
• Included and excluded items (appliances, light fixtures, window coverings)

A critical piece of advice: always include a lawyer review condition. This gives your real estate lawyer the right to review the APS and flag any concerning clauses, hidden obligations, or timeline issues before you’re locked into the deal. Many buyers skip this in competitive situations — and many regret it.

Step 5: Satisfy Your Conditions

Once the seller accepts your offer, the clock starts ticking on your conditions. Typically, you have 5 to 10 business days to:

• Confirm your financing: Your lender sends the final mortgage approval. If the appraisal comes in lower than the purchase price, you may need to renegotiate or find additional funds.
• Complete a home inspection: A professional inspector examines the property’s structure, roof, plumbing, electrical, HVAC, and foundation. If the inspection reveals major problems, you can negotiate repairs, a price reduction, or walk away.
• Have your lawyer review the APS: Your lawyer checks for title issues, unusual clauses, or obligations that could cost you money after closing.

Once all conditions are satisfied (or waived), the offer becomes firm. At this point, your deposit is at risk if you try to back out. The seller can keep the deposit and potentially sue you for damages.

Step 6: Hire a Real Estate Lawyer

If you haven’t already, this is when you absolutely need a real estate lawyer. In Ontario, a lawyer is required to complete a real estate transaction — you cannot close without one. Your lawyer handles the legal heavy lifting from this point forward:

• Title search: Investigating the property’s ownership history to uncover any liens, easements, unpermitted work orders, or zoning violations registered against the title.
• Status certificate review (condos): Analyzing the condo corporation’s financial health, reserve fund, special assessments, and ongoing litigation.
• Letter of requisitions: Formally demanding that the seller clear any title defects before closing.
• Statement of adjustments: Calculating the exact amount you owe on closing day, including prorated property taxes and utility credits.
• Receiving and holding funds in trust: Your down payment and your lender’s mortgage funds are deposited into your lawyer’s trust account before closing day.
• Registering the deed and mortgage: Officially transferring legal ownership in Ontario’s electronic land registry system (Teranet).
• Paying land transfer tax: Your lawyer submits the provincial (and municipal, if in Toronto) land transfer tax on your behalf at registration.

LD Law LLP handles every stage of this process for buyers across Toronto, including title searches, APS reviews, mortgage coordination, and electronic registration. Their real estate team is available 24/7 to answer questions as they come up — because in real estate, deadlines don’t wait for business hours.

Step 7: Arrange Home Insurance

Your mortgage lender will require proof of home insurance before they release your mortgage funds. You must have a policy in place before closing day, not after. The insurance must cover the replacement cost of the home and be effective from the closing date forward.

Shop for insurance early — ideally 2 to 3 weeks before closing. Some properties (especially older homes or homes with knob-and-tube wiring, aluminum wiring, or oil heating) can be difficult to insure and may require specialized policies that take longer to arrange.

Step 8: Do a Final Walkthrough

Most APS agreements give the buyer the right to a final walkthrough within 24 to 48 hours before closing. This is your last chance to confirm that:

• The property is in the same condition as when you made your offer
• Any agreed-upon repairs have been completed
• All included items (appliances, fixtures) are still in the home
• The seller has vacated completely and left the property clean

If there’s a problem during the walkthrough, your lawyer can negotiate a holdback — a portion of the purchase price held in trust until the issue is resolved.

Step 9: Deliver Your Closing Funds

Your lawyer will provide you with a trust letter detailing the exact amount you need to bring to the closing. This includes your remaining down payment (minus the deposit already held in trust by the listing brokerage), legal fees, title insurance premium, land transfer tax, and any prorated adjustments.

Funds must be delivered to your lawyer at least 1 to 2 business days before the closing date, via certified cheque or bank draft. Do not wait until closing day — a delayed wire or missing funds can jeopardize the entire transaction.

Step 10: Closing Day — You Get the Keys

On closing day, this is what happens behind the scenes:

• Your lawyer sends the purchase funds (your cash plus the mortgage money from your lender) to the seller’s lawyer’s trust account.
• The seller’s lawyer confirms receipt and both lawyers exchange signed closing documents electronically.
• Your lawyer registers the Transfer/Deed and your new mortgage in Ontario’s electronic land registry system. The registration deadline is 5:00 p.m. If registration happens after that, an escrow closing agreement allows you to take possession while the paperwork completes the next business day.
• Your lawyer pays the land transfer tax to the province (and the city, if you’re buying in Toronto).
• The seller’s lawyer distributes funds: paying off the seller’s old mortgage, paying the real estate agents’ commissions, and transferring the remaining equity to the seller.
• You get the keys. Typically from your agent or from a lockbox at the property, once your lawyer confirms that registration is complete or the escrow agreement is signed.

After closing, your lawyer sends you a final reporting letter with copies of all registered documents, your title insurance policy, and a breakdown of how every dollar was allocated.

How Much Does It Cost to Buy a House in Ontario? A Quick Reference

Cost	Typical Range (GTA)
Down payment	5–20% of purchase price
Provincial land transfer tax	0.5–2.5% (marginal rates)
Municipal land transfer tax (Toronto only)	0.5–2.5% (additional, Toronto buyers only)
First-time buyer PLTT rebate	Up to $4,000 (homes up to ~$368,000)
Real estate lawyer fees	$1,000–$2,500 + disbursements
Title insurance	$250–$500
Home inspection	$400–$700
Home insurance (annual)	$1,200–$3,000+
Property tax and utility adjustments	Varies (prorated on Statement of Adjustments)
Mortgage default insurance (CMHC)	2.8–4.0% of mortgage (if down payment < 20%)

Understanding these costs before you start looking at homes — not after you’ve signed an offer — is the single best way to avoid the financial shock that derails so many first-time buyers in the GTA. If you’re unsure about any of these numbers or how they apply to your specific situation, a 15-minute conversation with a real estate lawyer can save you thousands in surprises.