In Ontario, the deposit on a house is typically about 5% of the purchase price. On a $700,000 home that is around $35,000. You usually deliver it by certified cheque or bank draft within 24 hours of the seller accepting your offer. It is held in a trust account and credited toward your down payment at closing, so it is part of your purchase, not an extra cost on top.

Below is exactly how the deposit works, when a bigger one helps, and why your money is safe.

What is a deposit and how much do you need?

A deposit is the money you put down when you make an offer to buy a home. It shows the seller you are serious and gives them something to hold while the deal moves toward closing.

In most of Ontario, the customary deposit is around 5% of the purchase price. There is no fixed legal amount, so it can be higher or lower depending on the market and what you and the seller agree to. In competitive situations, buyers sometimes offer more to stand out.

~5%

the typical deposit on a home purchase in Ontario, delivered within 24 hours of the seller accepting your offer

The deposit is written into your offer, which in Ontario is the Agreement of Purchase and Sale. For a closer look at how the offer itself comes together, see how to make an offer in Ontario.

When do you pay the deposit?

You do not pay the deposit when you first sign your offer. You pay it once the seller accepts.

The Agreement of Purchase and Sale sets the timing. The most common wording is "upon acceptance," which usually means you deliver the deposit within 24 hours of the seller signing back an accepted deal. Some agreements say "herewith" (with the offer) or "as otherwise described," so always read your own terms.

Because the window is short, it helps to have the funds ready before you offer. Certified cheques and bank drafts take time to arrange, and money in a locked-in account (like an FHSA or RRSP) may need a few days to move.

How do you actually deliver it?

Sellers and brokerages want cleared funds, not a personal cheque that might bounce. You will usually deliver the deposit by:

  • Certified cheque from your bank
  • Bank draft
  • Wire transfer or electronic funds transfer (EFT), if the brokerage accepts it

You deliver it to the brokerage listed as holding the deposit in trust, most often the seller's (listing) brokerage.

Is my deposit money safe?

Yes. This is the part that worries most first-time buyers, and the answer is reassuring: the seller does not get to spend your deposit while the deal is in progress.

In Ontario, deposits are held in a real estate brokerage's trust account. A trust account is a separate, regulated account. The brokerage cannot use that money for its own expenses, and the funds sit there until the deal closes or the parties agree in writing on where the money goes.

Brokerages are regulated by RECO (the Real Estate Council of Ontario), and trust accounts come with rules and record-keeping requirements designed to protect your money.

Ontario deposit facts at a glance

  • Typical amount. Answer: About 5% of the purchase price
  • When it is due. Answer: Usually within 24 hours of the seller accepting your offer
  • How you pay. Answer: Certified cheque, bank draft, or accepted electronic transfer
  • Who holds it. Answer: The listing brokerage, in a regulated trust account
  • What it counts toward. Answer: Your down payment at closing (not an extra cost)
  • When it is at risk. Answer: If you walk away from a firm deal with no valid reason

Source: Zown Realty, Ontario 2026

Does the deposit count toward my down payment?

Yes. Your deposit is not an extra cost. It is an early instalment on the money you were already going to bring to the deal.

At closing, the deposit is credited toward your down payment. So if your down payment is $55,000 and you already put down a $35,000 deposit, you owe the remaining $20,000 (plus closing costs) on closing day. The deposit was simply the first piece of that total, paid early.

This is worth remembering when you budget. The deposit is a cash-flow timing question, not a separate expense. You need the money sooner, but it goes toward the same purchase.

Does a bigger deposit strengthen my offer?

Often, yes. A larger deposit signals to the seller that you are financially serious and confident the deal will close. In a competitive situation, a strong deposit can make your offer stand out even against a similar or slightly higher price.

That said, more is not always necessary. A deposit that meets the customary amount is usually enough, and you should not stretch beyond what you can comfortably deliver on short notice. The right amount balances making a strong impression with keeping your finances sensible.

The conditions in your offer matter here too. A clean, well-structured offer can be as persuasive as the deposit. For more on that, see offer conditions.

When is my deposit at risk?

Your deposit is at risk mainly in one situation: when you walk away from a firm deal without a valid reason.

An offer becomes firm once all conditions (like financing or a home inspection) are either met or waived. Before that point, if a condition is not satisfied and you back out properly under the terms of your agreement, you are generally entitled to your deposit back.

After the deal is firm, though, there are no more escape hatches. If you simply change your mind and refuse to close, the seller can pursue your deposit and, in some cases, more. This is why it is so important to understand your conditions and timelines before you sign. The Agreement of Purchase and Sale is the document that spells all of this out.

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Last updated July 27, 2026. General information, not legal or financial advice.