The impact that land transfer taxes will have on home affordability will vary tremendously depending on the market you’re in. For some, the land transfer tax is something to be despised. To others, it serves as a minor cost that is tacked onto their closing bill.

In Canada, each province will charge either a fee or a tax for the transfer of real estate ownership or property. However, the rate will vary greatly from province to province, with some charging tens of thousands of dollars while others charge rates so meagre that they may seem like pocket change to some. Here, we will break down how land transfer tax impacts home affordability, looking at both the best and worst cities to purchase homes for Canadians.

Land Tax Defined

Firstly let us define what land tax is: It is determined by the final purchase price of your new domicile. Once the total purchase price is determined the new homeowner will need to pay the tax — or equivalent fee — in cash only. Furthermore, the amount paid cannot be mortgaged. The amount of tax required for the successful transfer of the home affects when people purchase homes. That is, in Canadian markets that charge a lot to transfer ownership, prospective home buyers will need to save up for several additional years in order to purchase a home. Fortunately, there are more affordable real estate markets in Canada where a moderate fee structure allows for a relatively quick home purchase.

The Worst Land Transfer Tax Markets in Canada


Vancouver is known for its beautiful landscapes and vistas, but also for being the most expensive city in Canada to live in. As such, it comes as no surprise that Vancouver has the most expensive land transfer tax in Canada. Moreover, while Vancouver homeowners are only taxed at a provincial level, the average cost of a family home in Vancouver is 1.1 million dollars. As a result, the average homeowner will be expected to pay $20,076 in land transfer taxes. The transfer tax is also calculated on a sliding portion scale in Vancouver. That means that a home under $200,000 will have to pay 1% in land transfer tax, while homes over 2 million but under 3 million+ will be required to pay 3% in land transfer tax.


Toronto is currently home to the fastest growing real estate prices in the nation. Toronto is also notorious for being the only city in Canada that is taxed in full at both the municipal and provincial level: This is even after factoring in rebates for first time homeowners, whereby the city will provide a rebate of $4,475, and the province will provide a rebate of $4,000 for properties that cost more than $368,000. Interestingly, the average cost of a home in Toronto currently sits at $805,320, with homeowners having to pay $16,687 in land transfer tax. That amount amounts to 2.1% of their real estate purchase price. Moreover, repeat buyers will have to pay even more in land transfer fees, as they are not eligible for the generous rebates that the city and the province provide. Such buyers will be required to pay $25,162 in land transfer taxes, which amounts to 3.1% of their real estate purchase price.


Victoria rounds out our top 3 worst markets for land transfer taxation, with the average land transfer rate costing homeowners $12,270 or 1.7% of the real estate purchase price. The average home in Victoria currently sells for $713,485. It should also be noted that unlike Toronto, first-time homeowners cannot enjoy a rebate on a municipal or provincial level. As such, the land transfer tax remains the same for the first time and repeat home buyers.

The Best Land Transfer Tax Markets in Canada


Based in Southern Ontario, Windsor-Essex doesn’t charge any land transfer taxes for first-time buyers whatsoever. The average cost of a home in Windsor-Essex is only $303,193, which is under the minimum threshold of $368,000: This allows first-time homeowners to be completely exempt from the tax. However, repeat home buyers will need to pay a land transfer tax of $3,023, which is still a far cry from the tens of thousands that our worst markets have to pay.

London, Ontario

London barely makes it, as the average home in London, Ontario costs $366,096. As a result, lucky first-time homeowners don’t pay any provincial land transfer taxes. However, second-time buyers aren’t as lucky and will have to shell out $3,996 on their second purchase, which is still relatively affordable for most home buyers.

Edmonton, Alberta

Interestingly, home buyers in Edmonton don’t pay land transfer taxes. Instead, they are required to pay what is known as a title transfer fee. The fee is determined by the value of the mortgage as well as the overall value of the property. As such, the fee is paid out in 2 parts. A dollar for every five thousand dollars of home value is added to a fifty dollar base. This means the average homeowner in Edmonton only has to pay around $239 in title transfer fees. This accounts for a paltry 0.1% of their home purchase, and the amount required to be paid is the same for first-time and second time home buyers

The Final Choice

If high land transfer taxes are a dealbreaker for you then it is highly recommended to avoid the province of British Columbia and the city of Toronto. However, certain parts of Ontario have very affordable land transfer fees, while Alberta ranks number 1 as having the lowest land transfer fees of any kind in Canada. Remember that land transfer taxes in Canada must be paid in cash, and the cost differential between cities can add several years of waiting to home ownership.

For more more information about how land transfer tax could impact you, call Northwood Mortgage™ on +1 (888) 495-4825 or contact us here.