The Real Cost of Buying a Home in London Ontario
The Real Cost of Buying a Home in London Ontario
Most people focus on the purchase price. That's the big number — the one on the listing, the one you negotiate. But the purchase price is just the starting point. By the time you get your keys, you'll have spent more than the offer you signed. Here's exactly what to budget for so nothing catches you off guard.
Why the Purchase Price Is Only Part of the Picture
When someone asks "how much does it cost to buy a home in London Ontario," they're usually thinking about their mortgage payment and their down payment. Those are the two biggest numbers — but they're not the only ones. There's a category of costs that shows up at or before closing that a lot of buyers aren't fully prepared for, especially first-timers.
In Ontario, closing costs typically run between 1.5% and 4% of the purchase price on top of your down payment. On a $600,000 home in London, that's anywhere from $9,000 to $24,000 in additional costs that need to come from savings — not your mortgage. Understanding exactly what those costs are, and roughly what to expect from each, is one of the most useful things you can do before you start seriously shopping.
Rule of thumb: Budget 1.5%–4% of your purchase price in closing costs on top of your down payment. For most London Ontario buyers purchasing in the $500,000–$700,000 range, that means setting aside an additional $10,000–$25,000 in liquid savings before you go firm on an offer.
Every Cost You Need to Know About
Here's a breakdown of what you're actually paying for when you buy a home in Ontario — and a realistic range for each one.
Ontario Land Transfer Tax
Ontario charges a land transfer tax on every home purchase, calculated as a percentage of the purchase price on a sliding scale. On a $600,000 home, you'd pay approximately $8,475. On a $700,000 home, closer to $10,475. First-time buyers get a rebate of up to $4,000, which reduces — but rarely eliminates — this cost entirely.
Legal Fees & Disbursements
You'll need a real estate lawyer in Ontario to handle the title transfer, mortgage registration, and closing paperwork. Legal fees vary by lawyer and transaction complexity. Disbursements — the out-of-pocket costs your lawyer incurs, like title search fees and registration charges — add to the total. Budget $1,500 on the low end, $2,500 to be safe.
Home Inspection
A licensed home inspector walks through the property and reports on the condition of the structure, roof, electrical, plumbing, HVAC, and more. In London, most inspections run $450–$600 for a standard resale home, more for larger properties. This is one cost you don't want to skip — finding out a furnace needs replacing before you close is far less painful than finding out after.
Title Insurance
Title insurance protects you — and your lender — against issues with the property's title that might not show up in a standard search. Things like survey errors, encroachments, or fraud. Most lenders require it. It's a one-time premium paid at closing, typically in the $200–$400 range depending on the purchase price and insurer.
CMHC Mortgage Insurance
If you're putting less than 20% down, your mortgage is considered "high-ratio" and you're required to purchase mortgage default insurance through CMHC, Sagen, or Canada Guaranty. The premium is calculated as a percentage of your mortgage amount — 4% on a 5% down payment, 3.1% on 10% down — and is typically added to your mortgage rather than paid upfront. It's not a cash cost at closing, but it does affect your total borrowing.
HST on New Builds
Resale homes in Ontario are exempt from HST. New construction is not. If you're buying a brand-new home or condo, HST applies to the purchase price — though a rebate program exists for homes under certain thresholds. If you're considering new construction in London, this is a conversation to have with your agent and lawyer before you sign anything.
Moving Costs
Moving costs vary enormously depending on how much you own, how far you're moving, and whether you hire full-service movers or rent a truck. A local London move with a mid-size home and a professional crew typically runs $1,200–$2,500. Factor this into your budget — it tends to come right at the moment when your cash reserves are lowest.
Home Insurance
Your lender will require proof of home insurance before they release funds on closing day. Annual premiums in London Ontario typically run $1,200–$2,400 depending on the home's age, location, size, and your coverage level. Shop this before closing — you'll need the policy in place and the first payment made before the deal closes.
What Does It All Add Up To?
Let's put this into real numbers for a typical London Ontario purchase at $600,000 with a 10% down payment ($60,000).
That means a buyer purchasing a $600,000 home in London with 10% down needs approximately $74,000–$80,000 in total liquid savings — $60,000 for the down payment plus $14,000–$20,000 for closing costs. This is the number to plan around, not the mortgage payment alone.
Costs That Catch First-Time Buyers Off Guard
Beyond the list above, there are a few things that tend to surprise people — not because they're huge, but because they come at an inconvenient time or weren't on the radar at all.
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Property tax adjustments.If the seller has already paid property taxes beyond your closing date, you'll owe them a reimbursement at closing. Your lawyer handles this, but it's cash you need to have available.
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Utility deposits and hookups.Some utility providers in London require a deposit when setting up a new account. It's usually refundable, but it's another upfront cost.
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Immediate repairs or replacements.Even on a home that passed inspection, there's often something you want to address right away — a lock change, a paint job, a fixture that bothered you during showings. Budget a few hundred to a few thousand for first-month expenses.
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Condo status certificate review.If you're buying a condo in London, your lawyer needs to review the status certificate — which outlines the condo corporation's finances, rules, and any outstanding issues. This typically adds $100–$200 in legal fees and is something first-time condo buyers often overlook.
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The deposit — which is part of your down payment, not extra.When your offer is accepted, you'll put down a deposit — typically $10,000–$20,000 on a London home — within 24 hours. This isn't an additional cost; it comes off your purchase price at closing. But it does need to be liquid and accessible immediately. Don't have it sitting in a non-redeemable GIC.
How Much Do You Actually Need to Buy a Home in London Ontario?
The honest answer depends on your down payment, the purchase price, and your situation. But as a starting framework: if you're buying in the $500,000–$700,000 range — which covers a lot of London's resale market for detached homes — plan to have your down payment plus $12,000–$22,000 in additional liquid savings available at closing.
If you're a first-time buyer, the Ontario Land Transfer Tax rebate (up to $4,000) and the federal First Home Savings Account (FHSA) can meaningfully reduce your cost burden. These are worth understanding before you start shopping. Our guide on how buying works in London Ontario covers the process from start to finish, and our mortgage overview breaks down what lenders are actually looking for.
If you want a clear-eyed picture of what buying looks like for your specific situation — your income, your savings, your target price range — that's exactly the kind of conversation Eric has with buyers before they start searching. No commitment, no pressure. Just the real numbers. Reach out here.
Frequently Asked Questions
Let's Talk Through What Buying Actually Looks Like for You
Every buyer's situation is different. If you want a clear picture of what your budget gets you in London right now — and what you need to have in place before you start — Eric can walk you through it.
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