One of the first questions I get from London Ontario homeowners thinking about selling is:
“Phil, what is this actually going to cost me?”
It’s a good question and considering how much it costs to sell a home is a great first step.
Whether you’ve owned your home for 2 years or 20 years, nobody likes surprises when it comes to money. And if you’re selling one home to buy another, understanding the costs upfront can make the difference between a smooth move and a stressful one.
The good news is that the costs of selling a house in London, Ontario can be figured out in advance.
The bad news?
There are a few expenses that catch homeowners off guard every year as they do not prepare.
Let me walk you through them.
First, Let’s Clear Up a Common Myth
No, sellers do not pay land transfer tax in Ontario.
That’s one of the most common misconceptions I hear.
If you’re selling your home in Hyde Park, Byron, Summerside, Old North, Oakridge, or anywhere else in London, you generally won’t pay land transfer tax when you sell.
However—and this is important—if you’re selling and buying another property, you will pay land transfer tax on the purchase of your next home and this is a big expense that goes right to the government.
I’ve had clients focus entirely on what it costs to sell only to realize later they forgot to budget for the land transfer tax on the home they were buying.
That’s not a fun conversation to have two weeks before closing and your agent and your mortgage professional need to prepare you for this.
Here’s more info on the land transfer tax from the Ontario government who collects it.
Real Estate Commission
For most sellers, this is the largest expense and it can vary in the London area.
The exact amount depends on the agreement you have with your Realtor and the services being provided.
But here’s something I’ve learned after helping people buy and sell homes throughout London:
The cheapest Realtor is rarely the least expensive option.
A few years ago, I met a homeowner who had previously listed with an inexperienced agent that had another full-time job. They saved some money upfront (theoretically) but ended up sitting on the market for months, reducing their price multiple times, and ultimately having to call me to try to sell after losing a ton of momentum already. Contrary to popular belief, I do not have a magic wand, but I can help guide you through the process using my experience and plan.
Saving a few thousand dollars on commission doesn’t feel like much of a win if you leave tens of thousands of dollars on the table. I would always recommend looking at how much you get at the end of the process rather than just the commission rate.
In today’s market, MLS alone isn’t enough.
Buyers are scrolling social media, watching videos, browsing YouTube, and finding homes in places they never would have 10 years ago. The marketing strategy behind the listing matters more than ever.
Legal Fees
Every seller should budget for legal fees.
Your lawyer handles the paperwork, mortgage discharge, title transfer, adjustments, and ensures everything closes properly.
Think of it this way:
If your Realtor helps you get the best price, your lawyer helps make sure you actually get paid. A good lawyer, in my experience, can help solve problems before they even become an issue at all so I would recommend not going for the cheapest option.
Most sellers can expect legal fees and disbursements to fall somewhere in the $1,000 to $2,500 range, depending on the transaction but talk to the lawyer first and find a good fit. I can always make recommendations of London Ontario real estate lawyers. And one final note – make sure they are a real estate lawyer who is experienced in real estate law in Ontario!
Mortgage Penalties: The One That Sneaks Up on People
This is the expense that surprises homeowners more than almost anything else.
If you’re breaking a mortgage before the end of the term, there may be a penalty.
Sometimes it’s a few hundred dollars.
Sometimes it’s several thousand.
I once had clients who were convinced selling their home was impossible because they had heard their penalty would be massive. After speaking with their mortgage professional, the actual number ended up being far lower than they expected and they were able to move forward with confidence.
The lesson?
Don’t guess.
Get the actual number from your lender.
Preparing Your Home for the Market
This category varies wildly from one property to another.
Some homes need almost nothing.
Others benefit from a little work before they hit the market.
One of my favourite examples was a seller who was considering a major kitchen renovation before listing.
After discussing it, we decided against it.
Instead, we focused on decluttering, fresh paint, landscaping, and a deep clean.
The total cost was a fraction of a renovation and the home showed beautifully.
Sometimes the best return on investment isn’t spending more money, it’s spending money in the right places.
The Cost Nobody Thinks About
Want to know one of the biggest costs of selling a home?
It’s not commission.
It’s not legal fees.
It’s not mortgage penalties.
It’s leaving money on the table.
Overpricing a home can cause buyers to ignore it.
Underpricing a home can leave money behind.
Poor photos can reduce showings.
Weak marketing can reduce exposure.
I’ve seen homeowners spend weeks worrying about a few hundred dollars in closing costs while unknowingly risking thousands because their pricing or marketing strategy wasn’t right.
Those are the costs that matter most.
What Should London Home Sellers Budget For?
Most sellers should expect some combination of:
- Real estate commission
- HST on commission
- Legal fees and disbursements
- Mortgage discharge fees
- Mortgage penalties (if applicable)
- Home preparation expenses
- Moving costs
And if you’re purchasing another property:
- Land transfer tax
- Legal fees on the purchase
- Moving expenses
- Utility setup costs
Every Situation Is Different
This post is intended to provide general information, but every homeowner’s situation is unique.
Your mortgage, your lender, your lawyer, your financial goals, and the home you’re purchasing next can all impact your costs.
Before making a major decision like selling your home, I always recommend speaking with your mortgage professional, real estate lawyer, accountant, and any other professionals who can provide advice specific to your circumstances.
The goal isn’t just understanding what it costs to sell.
The goal is understanding how much you’ll actually walk away with after everything is paid and how that impacts your next move.
The Bottom Line
If you’re thinking about selling your home in London, Ontario, don’t rely on your neighbour’s opinion, a Facebook comment, or something your uncle told you based on what happened in 2021.
Every home is different.
Every market is different (including specific markets within the city of London Ontario).
Every seller is different.
The best way to understand your costs is to get real numbers based on your specific situation.
If you’re considering selling and would like a complimentary home value assessment and net proceeds estimate, I’d be happy to help.
Here to help if you have any questions on buying or selling in the London area!
Phil Bailey
London, Ontario Realtor
HouseSigma Inc. Brokerage
