Renting vs buying in Toronto
Toronto is the only city on this site where a buyer pays the land transfer tax twice, and the only one whose two halves are falling at visibly different speeds. Here is the arithmetic, including the property tax figure that takes a paragraph to explain, and then the part the arithmetic misses.
The short answer
The composite MLS® benchmark home in the City of Toronto is about $928,200 as of July 2026, down 3.83% on the year, and a three-bedroom purpose-built apartment rents for an average of $2,294. Run those two against each other at a 1% appreciation assumption and renting wins for a long time. The cost of getting in and out is why.
This city charges the land transfer tax twice. The provincial tax on that home is $15,039 and Toronto's municipal tax is another $15,039, because the two carry identical brackets below $2,000,000. Selling costs roughly 5.8% once 13% HST is added to the commission, about $53,800. That is close to $87,000 of friction on a $928,200 home, and it is the single largest reason the break-even year here is later than in any other city covered on this site.
The market is two markets and they are not moving together. Over the year to July 2026 the City's detached benchmark fell 4.40% and its apartment benchmark fell 7.09%. In the TRREB district around the Annex the same month reads down 2.15% for detached and down 14.65% for apartments. Whatever you decide, decide it about the half of the market you are actually buying into, and set the appreciation input accordingly.
The calculator below opens with real Toronto figures and every one of them is editable. Two warnings specific to this market: the property tax rate is set to 0.57% of market value, not the 0.767% the City levies, because Ontario assesses on frozen 2016 values and this model multiplies a present-day price. And the condo fee is set to zero, which is right for a house and badly wrong for an apartment.
Your situation
Compare like for like: the rent on somewhere you would actually be willing to live, not the cheapest listing in the city. Drop the price to around $300,000 and the rent to a one-bedroom figure to compare apartments instead, and put the condo fee in under Assumptions.
20.0% down. The renter starts with this plus closing costs: $218,918: invested instead.
The single biggest lever. Buying costs a lot to enter and a lot to exit, and only time amortizes that away.
Assumptions: every one of them editable
Toronto's composite benchmark is down 3.83% year over year: detached down 4.40%, townhouses down 5.75%, apartments down 7.09%. The default here is deliberately positive and deliberately small. Try a negative number for a condominium.
What the renter earns on the down payment they never spent. This is the comparison's hidden lever. A renter who spends it instead of investing it does far worse than this model shows.
Ontario caps annual increases at 2.1% for 2026, but only in units first occupied before 15 November 2018. Newer buildings have no cap at all.
Roofs, furnaces, fences, hail. Averaged out it is a real cost even in the years nothing breaks.
Zero for a house. For an apartment, roughly $0.85 a square foot a month is the planning figure, so about $680 on an 800 sq ft unit, and it varies with what the building runs rather than where it is: a tower with a pool, a gym and a concierge costs more per square foot than a walk-up. Read the status certificate and the reserve fund study before you trust any number here.
Commission and legal fees, charged against the price you eventually sell at. The owner's net worth below is after this comes off.
Net worth, side by side
The buyer's line is home value minus what is still owed minus the cost of selling, plus anything they invested in months when owning was cheaper. The renter's line is one portfolio: the down payment and closing costs they never spent, plus the monthly difference whenever renting is cheaper.
Show the year-by-year figures
| Year | Owner | Renter | Difference |
|---|---|---|---|
| 1 | $157,468 | $269,186 | −$111,718 |
| 2 | $183,962 | $321,627 | −$137,665 |
| 3 | $211,319 | $376,342 | −$165,023 |
| 4 | $239,574 | $433,437 | −$193,862 |
| 5 | $268,764 | $493,022 | −$224,258 |
| 6 | $298,926 | $555,213 | −$256,287 |
| 7 | $330,100 | $620,132 | −$290,032 |
| 8 | $362,327 | $687,907 | −$325,580 |
| 9 | $395,650 | $758,671 | −$363,021 |
| 10 | $430,115 | $832,566 | −$402,451 |
| 11 | $465,768 | $909,737 | −$443,969 |
| 12 | $502,657 | $990,340 | −$487,683 |
| 13 | $540,835 | $1,074,537 | −$533,701 |
| 14 | $580,354 | $1,162,496 | −$582,142 |
| 15 | $621,270 | $1,254,396 | −$633,127 |
| 16 | $663,640 | $1,350,425 | −$686,785 |
| 17 | $707,525 | $1,450,777 | −$743,252 |
| 18 | $752,988 | $1,555,659 | −$802,671 |
| 19 | $800,095 | $1,665,285 | −$865,190 |
| 20 | $848,915 | $1,779,882 | −$930,968 |
| 21 | $899,518 | $1,899,688 | −$1,000,170 |
| 22 | $951,980 | $2,024,950 | −$1,072,970 |
| 23 | $1,006,378 | $2,155,930 | −$1,149,551 |
| 24 | $1,062,795 | $2,292,901 | −$1,230,107 |
| 25 | $1,121,313 | $2,436,151 | −$1,314,838 |
- The mortgage is assumed to renew at the same rate. At the end of the first term you would still owe $650,202.
- Neither household is credited with tax on their investments, and the buyer's gain on a principal residence is tax-free while the renter's portfolio may not be.
Questions people actually ask
Is it worth buying in Toronto right now?
It depends far more than usual on what you are buying, because this is not one market. In July 2026 the City of Toronto's MLS® HPI composite benchmark was $928,200, down 3.83% year over year. Underneath that: the detached benchmark was $1,455,200 and down 4.40%, and the apartment benchmark was $551,900 and down 7.09%. In the district around the Annex the same month reads detached down 2.15% and apartment down 14.65%. So the honest answer for a house and the honest answer for a condominium are different answers, and anyone quoting you a single Toronto number is averaging over a twelve-point spread. Against a three-bedroom purpose-built rent of $2,294 a month, a benchmark-priced home does not pencil quickly at any appreciation assumption you can defend right now.
How long do you have to stay for buying to beat renting in Toronto?
Longer than anywhere else on this site, and the reason is the tax rather than the price. Getting in costs $15,039 in provincial land transfer tax on the benchmark home and another $15,039 in Toronto's municipal one, because the two carry identical brackets below $2,000,000. Add a lawyer, title insurance and an inspection and closing is about $33,300 before anyone has moved a box. Getting out costs roughly 5.8% once 13% HST is added to the commission, about $53,800. That is around $87,000 of pure friction on a $928,200 home, or nine per cent of the price, and at the 1% appreciation default it takes the better part of a decade to earn back. A stay under five years almost never pencils here. A first-time buyer claiming both rebates, $4,000 provincial and $4,475 municipal, saves $8,475 of it.
Why does Toronto charge two land transfer taxes?
Because the City of Toronto Act lets it. Toronto is the only municipality in Ontario with the power to levy its own land transfer tax, and it has done so since 2008. The municipal tax mirrors the provincial brackets almost exactly, so below $2,000,000 the effect is simply to double the tax: 0.5% on the first $55,000, 1% to $250,000, 1.5% to $400,000 and 2% above that, charged twice. Above $2,000,000 the municipal side climbs further than the provincial one, to 2.5% and then 4.4%, with additional bands above $3,000,000. Nowhere else in the province pays this. The same $928,200 purchase in Ottawa attracts $15,039 in total rather than $30,078, which is worth remembering when a national mortgage calculator quotes you a closing cost.
Why does this page say 0.57% property tax when my Toronto tax bill shows 0.767%?
Because Ontario has not reassessed property since 2016. The City levies its 2026 rate against a Current Value Assessment frozen at 1 January 2016 values, and the province has deferred every reassessment since. The City's own rates page works the example: an assessment of $692,140, which is MPAC's average for a Toronto home, at the 2026 rate of 0.767311%, gives $5,311 a year. That is 0.767% of the assessment and 0.57% of the $928,200 the same sort of home costs today. This calculator starts from a market price, so it has to use the market rate. There is a second thing worth noticing in those figures: $5,311 is almost exactly what the equivalent Ottawa home pays, on a house that costs 46% more. Toronto's rate is the lowest of any large city in the province and its bill is unremarkable, which is not the story anyone tells about Toronto property tax.
Does Ontario's rent control protect a Toronto tenant?
Only in older buildings, and in Toronto the exception covers a great deal of what is actually for rent. The province caps annual increases for sitting tenants at 2.1% for 2026, but only in units first occupied before 15 November 2018. Everything newer is uncapped, and a large share of Toronto's rental supply is condominium apartments owned individually and rented out, much of it completed well after that date. That is also the part of the market that is softening: the apartment benchmark fell 7.09% over the year and asking rents have followed. If you are renting a new unit the guideline does not protect you, and you should raise the rent-growth input. If you are renting an old one you are probably paying below market, the cap is worth a great deal, and moving would cost you more than the increase would.
How much do you need for a down payment in Toronto?
On the benchmark home, legally 5% of the first $500,000 and 10% of the portion above it: $67,820. At $928,200 the benchmark sits below the $1.5 million line where mortgage default insurance disappears and 20% down becomes mandatory, so the insured route is available on the composite even though it is not available on the detached benchmark of $1,455,200 plus closing costs for many buyers. Two Ontario caveats and one Toronto one. The premium at that down payment is 4.00% of the loan, or $34,415, which is added to the mortgage; the 8% provincial sales tax on it, $2,753, is payable in cash at closing and cannot be borrowed; and the two land transfer taxes are another $30,078 in cash on top. Budget the closing cheque before the down payment, not after.
Does this calculator favour renting or buying?
Neither, by construction. Both households start with exactly the same cash. Whichever of them has the cheaper month invests the difference. Most calculators credit only the renter with that, which quietly tilts every result toward renting. The buyer's net worth is also shown after the cost of selling, so it is money they could actually walk away with rather than a paper figure.
What is the calculator not accounting for?
Tax. A principal residence's gain is tax-free in Canada while the renter's portfolio generally is not, which favours buying, and neither side is modelled with a TFSA, an RRSP or a First Home Savings Account. It also assumes the mortgage renews at the same rate for its whole life. In this city it misses three more things. A condominium's special assessment, which no model can predict and which the reserve fund study is the only warning of. The maintenance fee, which is set to zero here and belongs in the calculation for any apartment. And the thing that decides a great many real Toronto moves, which is whether you are buying into the half of this market that fell 4% last year or the half that fell 7%.
Which figures here are estimates
The prices, rents, transfer taxes and the City's own tax figures above come from published sources, each one listed below with the period it describes. These do not:
- The property tax rate: as in Ottawa, and for the same reason. Ontario levies against a 2016 assessment, so the 0.57% used here is calculated from the City's own worked example and the benchmark price rather than quoted from a by-law. The workings are in the note beside the figure and in the questions below.
- Legal fees, title insurance and the home inspection: no Ontario body publishes a tariff, so these are planning figures. Budget above them for a condominium, because a status certificate has its own statutory fee and the lawyer has to read it.
- Condo fees and home and tenant insurance: industry ranges, not published statistics. A Toronto condo fee varies more with what the building runs than with where it is, and a 2010s tower with a pool and a concierge is a different number from a 1970s walk-up.
- Appreciation, rent growth, cost inflation and investment returns. Assumptions about the future, and the inputs most worth changing here. The 1% appreciation default sits above what the last twelve months actually did, and on the condominium side of this market a negative number is the defensible one.
If you want the payment side on its own. Frequencies, prepayments, the balance at renewal, the premium tax and both transfer taxes: the mortgage calculator covers it in more detail. To work out where rather than whether, start with the neighbourhood guides.
Sources
- Market Watch, July 2026 · Toronto Regional Real Estate Board · retrieved Supports: A City of Toronto MLS® HPI composite benchmark of $928,200 in July 2026, down 3.83% year over year, City of Toronto benchmarks of $1,455,200 single-family detached (down 4.40%), $1,146,300 single-family attached (down 4.00%), $725,300 townhouse (down 5.75%) and $551,900 apartment (down 7.09%), An All TRREB Areas composite benchmark of $934,600, down 4.63%, covering the region rather than the City, A GTA average selling price of $1,003,956 in July 2026, down 4.5% year over year, 5,995 sales, 14,484 new listings (down 17.8%) and 26,098 active listings (down 12.1%) in July 2026, District benchmarks for Toronto C02 ($1,302,900 composite, detached down 2.15%, apartment down 14.65%), C14 ($888,100), E07 ($735,600) and W06 ($814,300)
- Rental Market Survey: Toronto, average rent by bedroom type, October 2025 · Canada Mortgage and Housing Corporation · retrieved Supports: Toronto CMA average purpose-built rents of $1,491 bachelor, $1,761 one-bedroom, $2,045 two-bedroom and $2,294 three-bedroom-plus, An overall purpose-built average of $1,917, A Toronto CMA purpose-built vacancy rate of 3.0%, the highest since 2021
- Property tax rates and fees, 2026 · City of Toronto · retrieved Supports: A 2026 total residential rate of 0.767311%: 0.605295% city, 0.153% education and 0.009016% City Building Fund, The City's own worked example of $692,140 of assessment at 0.767311%, which is $5,311, Education rates set by the province and city rates set by council
- City of Toronto's 2026 Budget now final · City of Toronto · retrieved Supports: A combined 2026 residential property tax and City Building Fund increase of 2.2%, MPAC's average Toronto current value assessment of $692,140, An increase of $91.53 a year, or $7.63 a month, on that average assessment
- Municipal Land Transfer Tax rates and fees · City of Toronto · retrieved Supports: A municipal land transfer tax charged on top of the provincial one, on Toronto purchases only, Brackets of 0.5%, 1%, 1.5%, 2%, 2.5% and 4.4%, with further bands above $3,000,000, A first-time buyer rebate of up to $4,475 of the municipal tax
- Premium information for homeowner and small rental loans · Canada Mortgage and Housing Corporation · retrieved Supports: Mortgage default insurance premium rates by loan-to-value
- Regulations amending the Insurable Housing Loan Regulations and the Eligible Mortgage Loan Regulations (SOR/2025-55) · Canada Gazette, Part II · retrieved Supports: The $1.5 million insured price cap, 30-year amortization for first-time buyers and new builds
- Minimum qualifying rate for uninsured mortgages · Office of the Superintendent of Financial Institutions · retrieved Supports: The qualifying rate of the contract rate plus two points, or 5.25%
- Interest rates charged for new and existing lending by chartered banks · Bank of Canada · retrieved Supports: The default mortgage rate of 4.34%, uninsured five-year-plus fixed, funds advanced May 2026
- Calculating Land Transfer Tax · Ontario Ministry of Finance · retrieved Supports: Provincial transfer tax brackets, The conditional 2.5% band
- Municipal Land Transfer Tax rates and fees · City of Toronto · retrieved Supports: Toronto municipal transfer tax brackets, First-time buyer rebate
- Residential rent increases · Government of Ontario · retrieved Supports: 2026 rent increase guideline of 2.1%, The 2018 occupancy exemption
- Retail Sales Tax · Government of Ontario · retrieved Supports: 8% retail sales tax on insurance premiums
These are estimates built from published figures, not a lender quote, a pre-approval or financial advice. Rates, premiums and provincial rules change; confirm anything you plan to act on with a mortgage professional and read the sourcing methodology.