Thinking about tearing down an old home and starting fresh? In many Ontario neighbourhoods—especially where land is more valuable than the house itself—demolishing and rebuilding is a smart long-term investment. But before you start planning your dream home, it’s important to understand all the costs involved.
While renovating may seem cheaper upfront, major structural renovations often cost 70–90% of a new build—and still leave behind old foundations, outdated layouts, or hidden issues.
In cases where the home is structurally outdated, poorly designed, or requires significant upgrades (foundation, electrical, plumbing), demolish-and-rebuild is often the better value.
| Demolition Type | Average Cost (CAD) |
|---|---|
| Standard House Demolition (1,500–2,500 sq. ft.) | $15,000 – $35,000 |
| Partial Demolition / Interior Gut | $8,000 – $20,000 |
| Hazardous Material Removal (Asbestos, Mould, Lead) | $5,000 – $25,000+ |
| Disconnecting Utilities (Gas, Hydro, Water) | $1,500 – $3,500 |
| Site Cleanup & Waste Disposal | $3,000 – $7,000 |
Total average demolition cost: $20,000 – $50,000
| Type of Home Build | Cost per Sq. Ft. | Estimated Cost for 2,500 sq. ft. Home |
|---|---|---|
| Basic / Builder Grade | $200 – $250 | $500,000 – $625,000 |
| Custom Home | $250 – $400 | $625,000 – $1,000,000+ |
| Luxury Custom Build | $400 – $600+ | $1,000,000 – $1,500,000+ |
Key Cost Factors:
Size and complexity of the design
Architectural and structural engineering fees
Location (Toronto, GTA and Muskoka areas are higher)
Material choices (foundation, windows, roofing, finishes)
Labour and current construction market demand
Permit and development charges
| Project Type | Estimated Total Cost |
|---|---|
| Basic Home | $550,000 – $700,000 |
| Custom Home | $700,000 – $1,100,000 |
| Luxury Home | $1.2M – $2M+ |
| Permit / Fee | Approximate Cost |
|---|---|
| Demolition Permit | $300 – $600 |
| Building Permit (Rebuild) | $2,000 – $5,000 |
| Development Charges | $30,000 – $80,000 (varies by municipality) |
| Utility Disconnection | $1,500 – $3,500 |
| Waste Disposal Fees | $500 – $2,000 |
| Tree Removal / Urban Forestry Permits | $500 – $5,000 (if applicable) |
| Stage | Duration |
|---|---|
| Permits & Approvals | 1 – 3 months |
| Demolition & Site Clearing | 1 – 3 weeks |
| Excavation & Foundation | 3 – 5 weeks |
| Framing | 4 – 6 weeks |
| Plumbing, Electrical, Mechanical | 3 – 6 weeks |
| Interior & Exterior Finishes | 4 – 6 months |
| Total Time | 8 – 14 months |
Reuse existing foundation (if approved by engineer)
Choose pre-designed architectural plans instead of fully custom
Get fixed-price quotes from reputable builders
Avoid frequent design changes during construction
Apply for HST rebates or energy-efficiency grants where available
Demolishing and rebuilding a house in Ontario can range from $550,000 to over $2M, depending on size, design, and finishes. While it’s a major investment, it gives you the opportunity to build a modern, efficient, and perfectly customized home—often with better long-term value than renovating an outdated one.
Want real cost estimates based on your lot and design?
Grand Design Build can help you create a custom cost breakdown, permit checklist, and timeline—just let us know your address or home size.