Buying a House in London, Ontario: The Process and the Costs

Buying a house involves a lender, an agent, an inspector and a lawyer, and each one arrives at a different point. This guide puts the whole process in order for London, Ontario, with the cost rules checked against government sources. Where we have a detailed article on a step, we link to it instead of repeating it, so you can use this page as a map.

What homes cost in London right now

The London and St. Thomas Association of REALTORS® (LSTAR) reported these figures for September 2026:

Measure	September 2026
Composite benchmark price	$552,500
Single-family benchmark	$600,700
Townhouse benchmark	$421,500
Apartment benchmark	$317,100
Average sale price	$611,509
Months of inventory	5.9

LSTAR’s chair said the market “continued to show signs of a buyers’ market.” For a buyer that means more homes to choose from and, often, more room to include the conditions you want. Our London housing market page explains what benchmark prices and months of inventory mean and carries the newest numbers.

Step 1: Work out the cash you need

Three amounts have to be available in cash: the down payment, land transfer tax and your other closing costs.

Down payment

The federal minimums, published by the Financial Consumer Agency of Canada, are:

• 5% of the first $500,000 of the purchase price
• 10% of the portion from $500,000 to $1.5 million
• 20% of the whole price for homes of $1.5 million or more

Here is an illustration using our own arithmetic. On a home at LSTAR’s September composite benchmark of $552,500, the minimum is $25,000 on the first $500,000 plus $5,250 on the remaining $52,500, or $30,250 in total.

Mortgage loan insurance

If your down payment is less than 20%, your lender will require mortgage loan insurance. CMHC says the purchase price must be below $1,500,000 to qualify, a cap that was raised from $1 million effective December 15, 2024. CMHC’s premiums range from 0.60% to 4.50% of the loan, depending on how much you put down. The premium is normally added to the mortgage, but Ontario charges provincial sales tax on it, and that tax is paid in cash at closing. Our down payment and CMHC insurance guide goes through the tiers.

Ontario land transfer tax

Ontario charges land transfer tax on closing, in slices:

• 0.5% on the first $55,000
• 1.0% from $55,000 to $250,000
• 1.5% from $250,000 to $400,000
• 2.0% above $400,000
• 2.5% above $2,000,000, for land with one or two single-family residences

Ontario.ca’s worked example for a $400,000 home is $4,475. Using the same slices on the $552,500 illustration above, the tax is $4,475 plus 2.0% of $152,500, which comes to $7,525.

First-time buyers can claim a refund of up to $4,000. To qualify you must be at least 18, be a Canadian citizen or permanent resident, occupy the home as your principal residence within nine months, and never have owned a home anywhere in the world. The application must be made within 18 months of registration, and your lawyer usually handles it at closing. See our Ontario land transfer tax guide for the full picture, including the Non-Resident Speculation Tax.

Other closing costs

Budget for legal fees, a home inspection, adjustments for property tax and utilities, moving and immediate repairs. We do not publish a percentage because the amounts depend on the property and the professionals you hire, so ask your lawyer for a written estimate early. Our article on how much money you need to buy a house in Ontario lists the items to ask about.

Step 2: Use the first-time buyer programs

If you have never owned a home, three federal measures can help with the down payment and the monthly payment.

• First Home Savings Account (FHSA). The CRA sets participation room at $8,000 in the year you open your first FHSA, with unused room carrying forward by up to $8,000, against a $40,000 lifetime limit.
• Home Buyers’ Plan (HBP). You can withdraw up to $60,000 from your RRSP toward a first home. For first withdrawals made between January 1, 2026 and December 31, 2028, the CRA says the 15-year repayment period starts in the fifth year after the year of the first withdrawal.
• 30-year amortization. Since December 15, 2024, insured mortgages can be amortized over 30 years for all first-time buyers and for all buyers of new builds, according to the Department of Finance. A longer amortization lowers the payment and increases the total interest, so ask your lender to show both.

Buyers of newly built homes should also read about the federal first-time home buyers’ GST/HST rebate, which the CRA describes as worth up to $50,000 on eligible new homes. The details are in our first-time home buyer programs guide, and the practical sequence is in our first-time buyer checklist.

Step 3: Get pre-approved

A mortgage pre-approval tells you what a lender is prepared to offer based on your income, debts, credit and down payment, and it usually holds an interest rate for a limited time. It is not a guarantee: the lender still has to approve the specific property. Get it before you view homes so that your search matches your real budget. Our mortgage pre-approval guide explains the documents lenders ask for and how the federal stress test fits in.

Step 4: Choose an agent and sign a representation agreement

Real estate agents in Ontario are registered with the Real Estate Council of Ontario (RECO) and must walk you through the RECO Information Guide before providing services. The points that matter most to buyers:

• You sign a written agreement. RECO’s guide says a representation agreement must be put in writing and presented to you as soon as possible. Without one, you should not expect an agent to provide services such as showing you homes.
• Scope. A buyer agreement can cover a specific property, a geographic area or a type of property. Make sure the scope matches what you actually want.
• Expiry and holdover. The expiry date must appear prominently on the first page. There is no standard term. A holdover clause can mean you owe fees on a purchase made after the agreement expires, so check its length.
• What you pay. The amount is agreed between you and the brokerage and is not fixed or approved by RECO, any government or any real estate board. Your agreement must show the amount or how it is calculated, and how it changes if the seller agrees to cover some or all of your brokerage fees. RECO adds an important note: a seller might not offer anything toward your brokerage fees, which could affect what you can afford to offer.
• Multiple representation. If your brokerage or designated representative also represents the seller, or another buyer for the same home, that requires written disclosure and your written consent. You can refuse.

The alternative is to be a self-represented party. RECO says very few buyers choose this and that the seller’s agent cannot give you advice and must share what you tell them with the seller.

For help choosing, see how to find an agent you can trust and, for specialised purchases, choosing an agent for rural, condo or investment properties. Our buyer page explains how we work with buyers.

Step 5: Search with a short list of must-haves

Decide what you cannot change later, such as location, lot and the type of home, and stay flexible on what you can, such as paint and flooring. A few resources for narrowing things down:

• Condo vs house in London for the ownership trade-offs.
• Choosing a London neighbourhood for your family and the London community page.
• Nearby communities such as St. Thomas, Komoka, Ilderton, Dorchester and Strathroy.
• For country properties, wells and septic systems.
• For new homes, our new home construction page and the Tarion warranty guide.

Visit your shortlisted areas at different times of day, and check the property tax for any address you are serious about. Our London property tax guide explains how the City bills.

Step 6: Make an offer

An offer is made on an Agreement of Purchase and Sale. It sets the price, the deposit, the closing date, what is included and any conditions, such as financing or a home inspection. Conditions and irrevocable deadlines are set in the Agreement of Purchase and Sale, so ask your lawyer how they work before you sign. Your agent will prepare the offer, pull comparable sales to support the price and negotiate for you.

In a competing-offer situation, RECO says you are entitled to know the number of competing offers once you have made one. The seller decides whether the content of offers is shared, and your agent can explain how to avoid having yours shared. Before you write any offer, run through our list of questions to ask before making an offer.

Step 7: Inspect the home

A home inspection is a visual review of the home’s major systems by an inspector you hire. In a market with 5.9 months of inventory, buyers are often in a position to make an offer conditional on one. Attend the inspection, ask what is urgent and what is maintenance, and get quotes for anything significant before your deadline. Our home inspection guide explains what is and is not covered. Rural properties need additional checks on the well and septic system.

Step 8: Close with a lawyer

In Ontario a real estate lawyer completes the purchase. Hire one before you make an offer. Your lawyer searches title, receives the mortgage instructions from your lender, prepares the statement of adjustments, collects your closing funds including land transfer tax, applies for the first-time buyer refund if you qualify, and registers the transfer. Before closing you will also need to arrange home insurance, since your lender will normally ask for proof of it, and set up utilities. On closing day the funds are exchanged, the transfer is registered and you get your keys.

If you own a home already

Buyers who are also selling need to plan two closings. Start with a home valuation so you know your equity, then read should you buy before you sell and our guide to selling a house in London.

This guide is general information, not legal, mortgage or tax advice. Rules and figures change, so confirm them with your lender, lawyer and accountant. When you are ready to start, contact us.