Ontario mortgage guide — everything Ontario buyers need to know

Ontario Land Transfer Tax — the math

Ontario's provincial LTT is calculated on a graduated bracket system, similar to income tax:

| Bracket | Rate | |---|---| | Up to $55,000 | 0.5% | | $55,001 – $250,000 | 1.0% | | $250,001 – $400,000 | 1.5% | | $400,001 – $2,000,000 | 2.0% | | Over $2,000,000 (residential) | 2.5% |

Each rate applies only to the portion within that bracket — not the entire purchase price.

Worked example. $750,000 home in Ottawa (provincial LTT only, no MLTT):

• 0.5% × $55,000 = $275
• 1.0% × $195,000 = $1,950
• 1.5% × $150,000 = $2,250
• 2.0% × $350,000 = $7,000
• Total provincial LTT: $11,475

Use the Ontario LTT calculator for your specific scenario.

Toronto Municipal Land Transfer Tax (MLTT)

The City of Toronto charges its own MLTT in addition to provincial LTT — essentially doubling the bill on Toronto purchases. The MLTT mirrors the provincial schedule on the first $2M, then adds luxury surtax brackets above that:

| Bracket | Toronto MLTT rate | |---|---| | Same as provincial up to $2,000,000 | Mirrors provincial | | $2,000,001 – $3,000,000 | 2.5% | | $3,000,001 – $4,000,000 | 3.5% | | $4,000,001 – $5,000,000 | 4.5% | | $5,000,001 – $10,000,000 | 5.5% | | $10,000,001 – $20,000,000 | 6.5% | | Over $20,000,000 | 7.5% |

For a typical first-home Toronto purchase ($750k condo or townhouse):

• Provincial LTT: $11,475
• Toronto MLTT: $11,475
• Combined LTT before rebate: $22,950

First-time buyer rebate

Both provincial and Toronto first-time buyer rebates can be claimed:

• Provincial: up to $4,000 rebate on LTT — full exemption if your LTT is under $4,000 (typically homes under ~$368k)
• Toronto: up to $4,475 additional rebate on MLTT — full exemption if your MLTT is under $4,475 (similar threshold)
• Combined max rebate: $8,475 for Toronto first-time buyers

Eligibility (Ontario provincial):

• 18 years or older
• Canadian citizen or permanent resident
• Moving into the home as principal residence within 9 months
• Neither you nor your spouse has owned a home anywhere in the world previously

Toronto MLTT rebate has parallel eligibility plus the Toronto-specific criterion that the home is within the City of Toronto.

Non-Resident Speculation Tax (NRST)

Ontario charges an additional 25% NRST on residential property purchases by:

• Non-Canadian citizens AND non-permanent residents
• Foreign-controlled corporations
• Trusts where any non-Canadian beneficiary holds an interest

NRST applies province-wide (as of October 2022) — previously limited to the Greater Golden Horseshoe. It applies to residential properties with 1-6 single-family units. Purpose-built rentals with 7+ units are exempt.

For a $1,000,000 NRST-eligible purchase, the additional tax is $250,000 — on top of the standard provincial LTT and Toronto MLTT where applicable.

Rebates may be available if the buyer later becomes a Canadian citizen / PR within a specified window and meets occupancy requirements. See foreign buyer tax calculator for the math.

The federal Prohibition on the Purchase of Residential Property by Non-Canadians Act (in force through January 2027) also bans most non-Canadians from buying — so NRST often doesn't apply because the purchase isn't allowed in the first place.

Toronto Vacant Home Tax (VHT)

Toronto charges an annual 3% of Current Value Assessment vacant home tax on residential properties unoccupied 6+ months per year. Several exemptions apply (principal residence, tenanted, renovation, snowbird absence, death of owner) — but you must file an annual declaration even if exempt.

Missing the declaration deadline triggers the maximum tax automatically, even on owner-occupied homes. Deadlines are typically end of February for the prior tax year.

See vacant home tax calculator.

CMHC and Ontario's 8% PST

If your down payment is under 20%, you'll pay CMHC (or Sagen / Canada Guaranty) mortgage default insurance. Ontario applies 8% PST to the insurance premium itself — paid at closing, NOT financed into the mortgage.

On a typical $700k purchase with 10% down:

• Mortgage: $630,000
• CMHC premium: ~$19,530 (at 3.1%)
• Ontario PST on premium: ~$1,562

The $1,562 is an out-of-pocket cost on top of your regular closing budget. See down payment + CMHC calculator with Ontario selected.

Federal stress test

The federal mortgage stress test applies in Ontario as everywhere else in Canada:

Qualifying rate = max(contract + 2%, 5.25%)

You must qualify at the higher rate even though you'll actually pay the contract rate. See stress test history and stress test calculator.

Worked Toronto first-time buyer example

Couple buying a $700,000 Toronto condo, 10% down, first-time buyers:

| Cost line | Amount | |---|---| | Purchase price | $700,000 | | Down payment | $70,000 | | Insured mortgage (after CMHC premium added) | $649,530 | | Provincial LTT | $10,475 | | Toronto MLTT | $10,475 | | Provincial first-time buyer rebate | −$4,000 | | Toronto first-time buyer rebate | −$4,475 | | Net LTT | $12,475 | | CMHC premium (3.1%) | $19,530 | | Ontario PST on CMHC | $1,562 | | Legal fees | $1,800 | | Title insurance | $400 | | Property inspection | $500 | | Land transfer tax balance + closing extras | ~$1,500 | | Total cash needed at closing (beyond down payment) | ~$18,237 |

Plan for $90,000+ in total cash to close on a $700k Toronto condo as a first-time buyer with 10% down.

Ontario broker licensing

Ontario mortgage brokers are licensed by FSRA (Financial Services Regulatory Authority of Ontario) under the Mortgage Brokerages, Lenders and Administrators Act (MBLAA). Three licensing tiers:

• Principal Broker — oversees a brokerage; significant experience required
• Mortgage Broker — can supervise mortgage agents; 24+ months experience
• Mortgage Agent (Level 1 or Level 2) — entry-level licensing; supervised by a broker

Before working with any Ontario broker or agent, verify their license on the FSRA public registry at fsrao.ca. Check for disciplinary actions or license restrictions.

What to do next

1. Confirm your residency status — Ontario buyer who lived elsewhere may have NRST exposure
2. Calculate full closing costs at your purchase price using closing costs calculator
3. Use Ontario LTT calculator for LTT + MLTT specifics
4. If first-time buyer, stack FHSA + HBP + LTT rebate (see FHSA explained)
5. Verify your broker's FSRA license before signing
6. Run affordability at Ontario property tax rates for your target city
7. Plan around the Toronto MLTT threshold if you're flexible on location

Ontario is the largest Canadian mortgage market by volume. Strong broker ecosystem, deep lender competition, and the highest closing-cost burden in Canada. Plan accordingly.