Sandeep Pawar
Broker
Home / Buy
Buying a home in Ontario, step by step
The whole journey from budget to keys, in ten steps: what happens at each one, what you need to do, and where buyers lose money.
The short answer: set your budget and get pre-approved, sign a buyer representation agreement, shortlist homes against recent sales, make an offer with the right conditions and deposit, firm it up, then let your lawyer close. Budget for closing costs on top of your down payment. The biggest is land transfer tax: $14,475 on a $900,000 home in Brampton, and $28,950 on the same price in Toronto, where the city adds its own tax. Work out yours.
Buying in Brampton? See how to buy a house in Brampton without overpaying, with my recent buyer results.
Set your budget and goals
Decide what you can comfortably carry each month, not just what a lender will approve. The two numbers are often far apart.
What happens
You add up income, debts and savings, and decide what the home is for: family space, a rental unit, a shorter commute.
What you do
List must-haves and nice-to-haves. Gather down payment sources: savings, a First Home Savings Account (FHSA), and the RRSP Home Buyers’ Plan (up to $60,000).
Documents and people
Pay stubs or notices of assessment, bank statements, FHSA and RRSP statements.
Watch for
Spending every dollar of an approval. Leave room for property tax, utilities, maintenance and the first-year surprises.
How I help
I map your budget against real sale prices in the neighbourhoods you like, so you know what your money actually buys before you fall for a house.
Get a mortgage pre-approval
A pre-approval tells you your maximum price, your rate hold and your down payment rules. Get it before you tour seriously.
What happens
A lender or mortgage agent checks your credit, income and debts, then issues a pre-approval, usually with a rate held for a set period.
What you do
Compare at least two lenders. Confirm your minimum down payment: 5% of the first $500,000, 10% of the portion up to $1.5 million, 20% at $1.5 million or more.
Documents and people
ID, employment letter, two years of tax documents if self-employed, proof of down payment.
Watch for
The stress test: uninsured buyers qualify at the greater of their rate plus 2% or 5.25%. A pre-approval is not a final approval: the lender still has to approve the specific home.
How I help
I introduce you to a mortgage agent with access to the major banks and lenders, and I make sure your offer’s financing condition matches what the lender actually needs.
Choose your representation
In Ontario, a brokerage must have a written agreement with you before it acts for you as a client. Read it like any contract.
What happens
Your agent gives you RECO’s Information Guide and explains it, then you agree in writing on the term, the area, the services and how the brokerage is paid.
What you do
Ask about the term length, the geographic area, what happens if you buy privately, and how commission is handled. Everything is negotiable before you sign.
Documents and people
The buyer representation agreement and the RECO Information Guide.
Watch for
Signing for a long term or a very wide area without understanding it. You can ask for a shorter term to start.
How I help
I walk you through every clause before you sign, in English, Hindi, Punjabi, Urdu, Kannada or Telugu, and I put my services in writing.
Search and shortlist
Search the whole market, then narrow it with evidence: commute, schools, resale value and the true monthly cost.
What happens
You set up saved searches and get new listings by email, then tour the best matches.
What you do
Save a search on my home search. Decide between resale and pre-construction, and between detached, semi, town or condo.
Documents and people
Your pre-approval and must-have list.
Watch for
Homes that are priced to start a bidding war, and homes that have sat for weeks for a reason. Both need a different strategy.
How I help
I flag homes that look right on paper but carry hidden costs, and I send you listings that never made it to the big portals.
Tour and evaluate
Look past the staging. Check what you cannot change: location, lot, layout, structure and the condo’s finances.
What happens
You tour, take notes and compare each home with recent sales of similar homes nearby.
What you do
Ask about age of the roof, furnace, windows and any basement water. For a condo, ask for the status certificate.
Documents and people
Seller property information (if offered), past utility costs, and for condos the status certificate, which your lawyer should review.
Watch for
Unpermitted basement units, signs of water, and condo reserve funds that are too low for upcoming repairs.
How I help
I pull the comparable sales for every home you are serious about, so we know the fair range before we talk price.
Want the numbers on a home you are watching?
Book a 30-minute callSet your price and make an offer
The offer is a contract once signed by both sides. Price is only one of its levers.
What happens
We prepare an Agreement of Purchase and Sale with your price, deposit, conditions, closing date, included items and an irrevocable time (how long the seller has to answer).
What you do
Agree your walk-away number before writing the offer. Have your deposit ready, usually due within 24 hours of acceptance and held in trust by the listing brokerage.
Documents and people
Agreement of Purchase and Sale, deposit by bank draft or wire, your pre-approval.
Watch for
Dropping conditions you need just to win. Deposits and conditions matter as much as price.
How I help
I negotiate price, deposit, conditions and dates together, with your walk-away number set first. How I negotiate for buyers.
Handle multiple offers
When several buyers want the same home, the seller sets the rules. Your job is to compete without overpaying.
What happens
Offers are presented at a set time. The seller may accept one, sign one back, or ask everyone to improve. Since December 2023 a seller can choose to share offer details with other buyers.
What you do
Decide in advance your top price and which conditions you can safely remove, for example by inspecting before offer night.
Documents and people
A pre-inspection report, a firm financing position, a larger deposit if appropriate.
Watch for
Bidding against yourself, offering more than the appraisal supports without the cash to cover the gap.
How I help
I find out how many offers are registered and what the seller cares about, and I tell you honestly when to walk away. More on bidding wars.
From conditional to firm
With conditions, you have a few days to confirm financing, inspect and have your lawyer review documents before the deal is final.
What happens
You complete the home inspection, your lender approves the property, and your lawyer reviews any condo documents. Then you sign a waiver and the deal is firm.
What you do
Book the inspector immediately. Send the lender everything they ask for. Read the inspection report fully.
Documents and people
Inspection report, lender approval and appraisal, status certificate review, waiver or amendment.
Watch for
Missing a condition deadline. If a condition expires without a waiver, the deal can end automatically.
How I help
I schedule the inspector, keep every deadline on one calendar, and renegotiate if the inspection finds something material.
Before closing
Between firm and closing, your lawyer and lender do most of the work, but they need you to answer fast.
What happens
Your lawyer searches title, arranges title insurance, prepares the land transfer tax filing and receives your mortgage instructions.
What you do
Arrange home insurance, book movers, set up utilities, and send your lawyer the balance of your down payment and closing costs.
Documents and people
Insurance binder, ID, certified funds or wire for the balance, signed mortgage documents.
Watch for
New debt or a new car loan before closing. Your lender can re-check your credit.
How I help
I coordinate the lawyer, lender and seller’s side, and arrange any visits the agreement allows before closing.
Closing day and keys
On closing day the lawyers exchange funds and documents and register the transfer. Then the keys are released to you.
What happens
Your lawyer pays the seller, pays land transfer tax and registers you as the owner, usually by the afternoon.
What you do
Stay reachable. Do a final walkthrough if your agreement allows one. Check that included items are there.
Documents and people
Your lawyer’s final statement of adjustments and the deed.
Watch for
A late wire. Send funds a day early so closing is not delayed.
How I help
I hand you the keys, and I stay your point of contact after closing for anything about the home.
Costly mistakes I see buyers make
- Treating a pre-approval as a final approval.
- Removing a home inspection condition without inspecting first.
- Budgeting only for the down payment and forgetting closing costs.
- Buying a home with a basement unit without checking that it is legal.
- Letting a bidding war set the price instead of comparable sales.
- Changing jobs or taking on new debt before closing.
Questions buyers ask
How long does it take to buy a home in Ontario?
From mortgage pre-approval to keys, most resale purchases take two to four months: a few weeks to a few months of searching, then a closing period that is usually 30 to 90 days, set in your offer. A pre-construction home can take years to close.
Do I have to sign a buyer representation agreement?
Since 1 December 2023, under Ontario’s Trust in Real Estate Services Act (TRESA), a brokerage must have a written agreement with you before it provides client services, and your agent must first give you and explain the RECO Information Guide. The agreement sets the term, the area, the services and how your agent is paid, and every part of it can be discussed before you sign.
How much do I need for a down payment in Ontario?
At least 5% of the first $500,000, 10% of the portion between $500,000 and $1.5 million, and 20% for homes of $1.5 million or more. With less than 20% down you also pay mortgage loan insurance. Lenders can ask for more.
What is the mortgage stress test?
For an uninsured mortgage (20% or more down), federally regulated lenders must qualify you at the greater of your contract rate plus 2% or 5.25%. It is a qualifying test only: your payments are based on your actual rate.
Can I back out after my offer is accepted?
Only through a condition written into the offer, such as financing or a home inspection, and only within its deadline. Once the offer is firm, walking away usually means losing your deposit and possibly being sued for the seller’s losses. Resale homes in Ontario have no cooling-off period.
Is there a first-time buyer land transfer tax refund?
Yes. Eligible first-time buyers can get up to $4,000 back on Ontario’s land transfer tax, and up to $4,475 on Toronto’s municipal land transfer tax when buying in Toronto. Your lawyer usually claims it when the transfer is registered.
Sources
Ready to start, or just want a second opinion?
Tell me what you are looking for and your budget. I will tell you honestly what it buys today and what I would do next.