What Does It Cost to Downsize in Ontario? Complete Selling, Buying & Moving Cost Guide

by Ana Bastas

What Does It Cost to Downsize in Ontario? Complete Selling, Buying & Moving Cost Guide

If I Sell for $1.5 Million and Buy for $800,000, Do I Keep $700,000?

This is one of the first calculations homeowners make when considering downsizing.

Current home:

$1,500,000

New home:

$800,000

Difference:

$700,000

It looks straightforward.

But that $700,000 isn't necessarily the amount you'll have left after moving.

There may be costs associated with:

Selling

Buying

Legal work

Land transfer tax

Moving

Preparing the current home

Preparing the new home

Mortgage discharge or financing

Condominium requirements

and other transaction-specific expenses.

So the better question is:

“WHAT WILL I ACTUALLY HAVE LEFT AFTER THE ENTIRE MOVE?”

That's the number that matters when downsizing is part of your retirement plan.

Start With Your Current Home Value

Before calculating anything else, establish a realistic estimate of your home's current market position.

Not:

“My neighbour thinks it's worth $1.6 million.”

Not:

“An online calculator says $1.7 million.”

And not:

“The house down the street listed for $1.8 million.”

We need to consider:

Recent comparable sales

Current competition

Location

Lot

Size

Condition

Renovations

Layout

Basement

Parking

Market conditions

and property-specific features.

REQUEST A COMPLIMENTARY HOME VALUE REVIEW →

STEP 1 — Calculate Your Estimated Sale Proceeds

Begin with:

EXPECTED SELLING PRICE

$________

Then subtract the amounts that would need to come out of the transaction.

Potential items can include:

Mortgage payout

Real estate remuneration

HST where applicable

Legal expenses

Mortgage discharge-related costs where applicable

Adjustments

Other property-specific closing expenses

This gives you a much more useful number:

Estimated net sale proceeds

COST #1 — Your Mortgage

If you still have a mortgage, it generally needs to be accounted for when determining what equity is actually available from the sale.

Example:

Home sells:

$1,500,000

Mortgage balance:

$300,000

Before considering other selling costs, you're now working from approximately:

$1,200,000

not $1.5 million.

This sounds obvious, but when homeowners mentally calculate:

“House value minus new house,”

they sometimes forget the existing financing.

Ask Your Lender for the Actual Payout Information

Your mortgage balance shown online may not necessarily equal the exact amount required on a particular closing date.

Depending on the mortgage and transaction, there may be:

Accrued interest

Discharge-related costs

Prepayment charges

or other lender-specific amounts.

Ask your lender or mortgage professional for appropriate payout information when you're seriously considering a sale.

COST #2 — Real Estate Remuneration

When selling through a brokerage, real estate remuneration is part of the transaction economics.

The amount varies based on the listing arrangement and services agreed upon.

It should be discussed clearly before you list.

For downsizing calculations, don't ignore it.

We want to estimate:

What will I likely net?

not simply:

What might the property sell for?

COST #3 — HST Where Applicable

Certain professional services involved in a real estate transaction may be subject to HST.

This can include real estate remuneration and various professional services.

When preparing a downsizing budget, make sure quotes clearly identify whether applicable taxes are included.

A quote of:

$5,000

and:

$5,000 + applicable tax

are not the same budget.

COST #4 — Legal Fees and Disbursements

You'll generally need a real estate lawyer to complete the legal aspects of your sale and purchase.

Depending on the transaction, legal costs may include:

Professional fees

Disbursements

Registration-related expenses

Title-related work

Mortgage-related work

and applicable taxes.

Ask your lawyer for an estimate based on your specific transaction.

COST #5 — Preparing the Current Home for Sale

This category can range dramatically.

One seller may spend:

Very little.

Another may spend tens of thousands.

Potential preparation costs include:

Decluttering

Junk removal

Storage

Cleaning

Painting

Repairs

Flooring

Landscaping

Window cleaning

Staging

Contractors

Moving furniture

But remember our rule:

DO NOT RENOVATE BEFORE YOU HAVE A SELLING STRATEGY.

READ: Should You Renovate Before Downsizing? →

Home Preparation Is Not About Making the House Perfect

Your preparation budget should be based on:

What will likely improve the selling outcome?

not:

What would make the house look nicest?

Those are different.

Before spending $50,000, understand whether the market is reasonably likely to reward that expenditure.

COST #6 — Decluttering and Disposal

After 30+ years, this can become a real line item.

Potential costs include:

Dumpster/bin rental

Junk removal

Professional organizer

Downsizing specialist

Storage

Document shredding

Furniture removal

Donation pickup where charges apply

Estate-sale assistance

The cost varies enormously based on the amount of property and the amount of work you're comfortable doing yourself.

READ: How to Downsize a Home After 30+ Years →

COST #7 — Professional Moving

Moving costs depend on:

Distance

Size of home

Number of belongings

Number of movers

Time

Packing services

Boxes/materials

Storage

Specialty items

Elevator access

Travel

Furniture assembly

and timing.

Get multiple written estimates and understand exactly what's included.

COST #8 — Storage

Storage can become a hidden downsizing cost.

You sell the large house.

You move to a condo.

But you can't decide what to do with everything.

So you rent a storage unit.

Then another year passes.

And another.

Calculate:

Monthly storage cost × expected number of months.

If you don't have a clear exit plan for stored belongings, storage can become a long-term expense rather than a temporary moving cost.

STEP 2 — Calculate the Cost of Your Next Home

Now we move to the purchase side.

Start with:

PURCHASE PRICE

$________

Then potentially add:

Ontario land transfer tax

Toronto municipal land transfer tax if applicable

Legal expenses

Title insurance where applicable

Home inspection

Status certificate/legal review considerations for condos

Mortgage-related expenses where applicable

Moving

Immediate improvements

Furniture

Condo deposits/move-related requirements where applicable

and other transaction-specific costs.

COST #9 — Ontario Land Transfer Tax

Ontario purchasers generally need to account for provincial land transfer tax when acquiring property, subject to applicable exemptions or rebates.

The amount depends on the purchase price and circumstances.

Because tax rules can change, Fona should not hard-code a calculation into the article unless the current Ontario calculation is verified immediately before publication.

Instead, link to an appropriate current official Ontario resource or our verified calculator.

COST #10 — Toronto Municipal Land Transfer Tax

If your replacement property is in Toronto, there may also be municipal land transfer tax in addition to Ontario land transfer tax.

This can materially change the transaction-cost calculation.

Someone selling in Halton and purchasing in Toronto should not use the same closing-cost assumption as someone purchasing in Georgetown or Niagara.

Location matters.

COST #11 — Legal Costs on the Purchase

The purchase side also involves legal work.

Depending on your transaction, your lawyer can explain:

Professional fees

Disbursements

Registration

Title insurance

Mortgage-related work

Adjustments

and other closing costs.

Get an estimate rather than using a random online number.

COST #12 — Home Inspection / Due Diligence

Depending on the property and transaction, you may choose or need various forms of due diligence.

For example:

Home inspection

Specialized inspections

Condominium status certificate review

Legal review

Well/septic considerations for certain properties

or other property-specific investigations.

Build appropriate due-diligence costs into your purchase budget.

COST #13 — Condo Fees

This isn't necessarily a closing cost.

But it can completely change the financial outcome of downsizing.

Suppose you eliminate your mortgage by moving into a condo.

Wonderful.

But now your condo fees are:

$900/month.

That's:

$10,800/year.

The condo may still be exactly the right decision.

But you need to compare:

ONGOING COSTS

as well as:

TRANSACTION COSTS.

COST #14 — Condo Move-In Requirements

Some condominium corporations have specific moving procedures.

Depending on the building, you may need to consider:

Elevator reservations

Deposits

Moving hours

Insurance documentation

or other building-specific requirements.

Confirm these before moving day.

COST #15 — New Furniture

This is one people forget.

You move from a large traditional detached home to a contemporary condo.

Then discover:

Your sectional doesn't fit.

Your dining table is enormous.

Your king bedroom suite overwhelms the room.

Your storage furniture doesn't work.

Suddenly you're buying:

Sofa.

Dining set.

Storage.

Lighting.

Bedroom furniture.

Balcony furniture.

Include a realistic furniture budget if the new property requires it.

COST #16 — Improvements to the New Home

You may want to complete work before moving in.

For example:

Painting

Flooring

Lighting

Closet systems

Window coverings

Bathroom modifications

Accessibility improvements

Kitchen changes

It's easier to complete many of these before the movers arrive.

But they still reduce the amount of capital ultimately released through downsizing.

COST #17 — Utility and Service Transitions

Smaller expenses add up.

Potential costs can include:

Internet setup

Utility setup

Alarm/security changes

Key/fob deposits

Cleaning

Mail forwarding

Service cancellation

New household equipment

Individually, these may be modest.

Collectively, they deserve a miscellaneous transition budget.

The Real Downsizing Equation

This is the equation I want every downsizer to understand.

CURRENT HOME SALE PRICE

minus

Mortgage

minus

Selling Costs

ESTIMATED NET SALE PROCEEDS

Then:

REPLACEMENT HOME PRICE

plus

Purchase Costs

plus

Moving

plus

Immediate Improvements

plus

Other Transition Costs

TOTAL COST OF NEXT HOME / MOVE

Then:

NET SALE PROCEEDS – TOTAL TRANSITION COST = POTENTIALLY RELEASED CAPITAL

That's the retirement planning number we want to estimate.

A Hypothetical Downsizing Example

Let's use deliberately simplified numbers.

CURRENT HOME

Sale price:

$1,500,000

Mortgage:

$200,000

Other selling/closing/preparation costs:

$80,000

Illustrative net proceeds:

$1,220,000

Now:

REPLACEMENT HOME

Purchase price:

$800,000

Purchase/moving/immediate setup costs:

$50,000

Illustrative total:

$850,000

Potentially released capital:

$370,000

Not:

$700,000

That's a dramatic difference.

Why This Matters for Retirement Planning

Imagine you told your financial advisor:

“Downsizing should free up around $700,000.”

They begin planning around that number.

Then the actual move leaves:

$370,000.

That's a very different retirement scenario.

This is why the real estate calculation needs to happen before the broader financial plan relies on released home equity.

Don't Forget Your Monthly Costs After the Move

Downsizing has two financial effects:

1. CAPITAL

How much equity do you release?

2. CASH FLOW

How do your monthly housing costs change?

You need both.

Example: Current Detached Home

Mortgage:

$________

Property tax:

$________

Insurance:

$________

Utilities:

$________

Maintenance:

$________

Landscaping/snow:

$________

TOTAL MONTHLY:

$________

Example: Future Condo

Mortgage:

$________

Condo fee:

$________

Property tax:

$________

Insurance:

$________

Utilities:

$________

Parking/storage:

$________

TOTAL MONTHLY:

$________

Now compare.

Downsizing Doesn't Always Save Money Every Month

This surprises people.

You could sell a large mortgage-free house and move into a luxury condo.

You may release equity.

But the condo could have substantial monthly fees.

Conversely, you could move to a smaller bungalow and continue paying for:

Landscaping.

Snow.

Exterior maintenance.

Repairs.

The objective isn't simply to own fewer square feet.

It's to choose a housing structure that works for your retirement.

Compare at Least Three Scenarios

Before making a decision, I recommend evaluating:

SCENARIO A — STAY

No transaction costs.

Current monthly costs.

Future maintenance.

Equity remains in current home.

SCENARIO B — DOWNSIZE LOCALLY

Sell current home.

Purchase smaller home in same general area.

Calculate equity released.

Calculate future monthly costs.

SCENARIO C — RELOCATE

Sell current home.

Purchase in a different market.

Calculate equity released.

Calculate monthly costs.

Evaluate lifestyle impact.

READ: Halton vs. Niagara for Retirement →

What About Renting Instead of Buying?

Some downsizers may consider selling and renting.

That could potentially:

Release more home equity.

Eliminate property maintenance.

Provide flexibility.

But it also introduces:

Monthly rent

Future rent changes

Less control over the property

Different estate implications

and other considerations.

Renting isn't automatically better or worse.

It should be included as another housing scenario if it genuinely interests you.

What About a Retirement Community?

A retirement residence or service-based community should be evaluated differently from purchasing a condo or bungalow.

The monthly cost may include combinations of:

Housing

Meals

Activities

Housekeeping

Support

Amenities

and other services.

Don't compare:

Condo fee

to:

Retirement residence monthly fee

without understanding what each actually includes.

READ: Best Retirement Communities in Georgetown & Halton →

What About a Life Lease?

Life lease arrangements can have different:

Ownership structures

Entry costs

Monthly costs

Resale provisions

Exit provisions

and legal arrangements.

Understand the specific agreement before comparing it with a condominium.

READ: Life Lease vs. Condo in Ontario →

What About the Cost of NOT Downsizing?

This deserves its own calculation.

Staying avoids:

Selling costs

Buying costs

Moving costs

and the disruption of relocating.

But staying may involve future:

Roof

Windows

HVAC

Driveway

Bathrooms

Accessibility modifications

Landscaping

Snow removal

Cleaning

Major maintenance

So don't compare:

Cost of moving

to:

$0 cost of staying.

That's not necessarily accurate.

Compare:

MOVE COST

versus

EXPECTED COST OF STAYING

over a reasonable planning period.

The Emotional Cost Matters Too

Not everything belongs in Excel.

There is also:

Stress.

Time.

Leaving neighbours.

Sorting belongings.

Family disagreements.

Learning a new neighbourhood.

Adjusting to a smaller home.

Those factors matter.

But there can also be emotional benefits:

Less responsibility.

A fresh start.

More travel.

Closer family.

Easier living.

A home that fits better.

Money is only one part of the decision.

The Ana Bastas Downsizing Financial Process

When someone tells me:

“We're thinking about downsizing because we want to free up some money for retirement.”

I don't want to guess.

We calculate.

STEP 1 — CURRENT HOME VALUE

What might it realistically sell for?

↓

STEP 2 — CURRENT MORTGAGE

What needs to be repaid?

↓

STEP 3 — SELLING COSTS

What will it cost to sell and prepare?

↓

STEP 4 — REPLACEMENT HOUSING

What does the next home realistically cost?

↓

STEP 5 — PURCHASE + MOVING COSTS

What will the entire transition cost?

↓

STEP 6 — POTENTIAL RELEASED EQUITY

What's actually left?

↓

STEP 7 — MONTHLY COST COMPARISON

Does future housing cost more or less each month?

↓

STEP 8 — FINANCIAL PROFESSIONAL REVIEW

What does the resulting capital and cash-flow difference mean within your retirement plan?

NOW YOU CAN MAKE AN INFORMED DECISION.

Start With the Home Value

You cannot calculate downsizing accurately if the first number is wrong.

If you're thinking about moving—even two years from now—start by understanding the current market position of your property.

REQUEST A COMPLIMENTARY HOME VALUE REVIEW →

There is no obligation to list.

The purpose is to begin with better information.

Thinking About Downsizing?

Before touring condos every weekend, let's determine:

What your current home may sell for.

What you may actually net.

What your preferred next home costs.

What the transaction may cost.

How much equity you may actually release.

Then you can take those numbers to your financial professional.

DOWNSIZING ISN'T ABOUT THE DIFFERENCE BETWEEN TWO LIST PRICES.

IT'S ABOUT WHAT YOU HAVE LEFT AFTER THE ENTIRE TRANSITION.

BOOK A DOWNSIZING & RETIREMENT STRATEGY CALL →

REQUEST A COMPLIMENTARY HOME VALUE REVIEW →

FAQ SECTION

How much does it cost to downsize in Ontario?

There is no single amount. Costs depend on the current property, mortgage, listing arrangement, home preparation, replacement property, land transfer tax, legal work, moving and other transaction-specific expenses.

How do I calculate how much money I'll have after downsizing?

Estimate the net proceeds from your current home after mortgage and selling costs. Then subtract the complete cost of purchasing, closing, moving into and preparing your replacement home.

Do I pay land transfer tax when downsizing in Ontario?

Purchasers in Ontario generally need to account for provincial land transfer tax, subject to applicable rules, exemptions or rebates. Additional municipal land transfer tax may apply in Toronto. Verify current requirements for your transaction.

Do sellers pay land transfer tax in Ontario?

Land transfer tax is generally associated with the purchase/acquisition side rather than simply selling your existing Ontario home. Your lawyer should confirm transaction-specific obligations.

Do I need to renovate before downsizing?

Not automatically. Have the property evaluated before spending significantly on renovations so the likely market benefit can be compared with the cost, time and disruption.

Is moving to a condo always cheaper?

No. A condo may reduce certain maintenance responsibilities but introduce monthly condominium fees and other costs. Compare total monthly housing expenses.

Does downsizing always release home equity?

No. The amount released depends on your existing mortgage, selling costs, replacement-home cost, transaction costs and moving expenses.

Should I sell my home before buying when downsizing?

There isn't one correct answer. The strategy depends on finances, market conditions, housing availability, timing and your tolerance for risk. This should be planned before entering into transactions.