Parent Moving to Long-Term Care: What Happens to the House?

By Jatin Dua · Broker of Record, RE/MAX Quantum Realty · Updated 29 September 2026 · 11 min read — how the long-term care placement process works, the July 2026 co-payment rates and the low-income rate reduction, then the three choices for the house (sell, rent or keep it in the family), the principal residence and power of attorney questions, and what to ask the insurer about an empty home.

First, the timeline: how a long-term care move happens

It helps to understand how a long-term care placement works, because it sets the pace for every decision about the house. From Ontario’s pages:

• You apply through Ontario Health atHome (1-833-515-1234). A care coordinator assesses eligibility.
• You can choose up to five homes, in order of preference.
• When a bed is offered, you have 24 hours to accept or refuse and up to five days to move in.
• If you refuse, or miss the move-in deadline, you are removed from every waiting list and must wait 12 weeks to reapply.

The wait itself can be long. The Ontario Long Term Care Association, an industry group rather than the government, says more than 50,000 people were waiting as of March 2026, and that half of people entering long-term care wait at least 165 days. The practical upshot: the call can come after months of waiting, and then the move happens within days. Nobody should be trying to sell a house in those five days. Plan the house decision during the wait.

For the wider picture, see my comparison of retirement homes and long-term care and my guide to retiring in Toronto and the GTA.

What long-term care costs in 2026

In Ontario, long-term care residents pay a co-payment for their accommodation, set by the province. The rates from 1 July 2026:

The yearly column is simply the monthly rate times twelve. Confirm the current rates on the province’s page before you budget.

The rate reduction, and why the house does not count

This is the point many families get wrong. Ontario offers a rate reduction for residents who cannot afford the basic rate, and it is based on income, not assets. The province’s page says assets, including home ownership, are excluded.

• It is available only for basic accommodation. Semi-private and private rooms are not eligible.
• Without dependants, a resident would likely qualify if their income is less than $27,338 (at July 2026 rates).
• The formula: reduced monthly rate = (annual net income ÷ 12) − a $149 monthly comfort allowance − any dependant deductions.
• Apply within 90 days of moving in; the reduction can apply back up to 90 days. Reapply every year between 1 July and 28 September.
• Contact: LTC.RateReduction@ontario.ca or 1-866-434-0144.

An illustration, not a quote: a resident with $24,000 of net income and no dependants would pay about $24,000 ÷ 12 = $2,000, minus $149, or $1,851 a month for a basic room. Because the formula uses net income, any rent the house earns could change the result. Ask the rate reduction office before you sign a lease.

Can pension income cover the co-payment?

Often not entirely, which is why the house becomes part of the conversation. Using federal figures for 2026, purely as arithmetic:

Every family’s income is different: workplace pensions, RRIFs, GIS and a spouse’s needs all change the picture. But it shows why so many families look at the house to fund a private room, extra care, or the spouse who stays behind.

Option 1: Sell the house

Selling is the most common choice, and the simplest once it is done. The proceeds can fund care, support a spouse and simplify the estate. A few things to know:

• What it might sell for. TRREB’s August 2026 detached medians (one month) were $1,170,000 for the City of Toronto, $1,189,000 for Mississauga and $860,000 for Durham Region. A specific house can be well above or below. My net proceeds calculator estimates what you keep after costs.
• The principal residence exemption. A home is generally free of capital gains tax for the years it was the family’s principal residence. CRA’s test is that you, your spouse or partner, or a child lived in it at some time during the year, and a family can designate only one home per year. How the years after a parent moves out are treated is a question for your accountant.
• Reporting the sale. Since the 2016 tax year, the sale of a principal residence must be reported on Schedule 3 and form T2091(IND). CRA can charge a late-designation penalty of the lesser of $8,000 or $100 for each complete month late.
• Timing. Selling after the move, once the house is cleared, usually shows better and removes pressure from the parent.

For a deeper look, see selling the house to pay for a retirement home and the tax side of selling in retirement. The downsizing money planner below can help model what a sale frees up.

Option 2: Rent it out

Some families rent the house to cover the co-payment and keep the property for later. It can work, but go in with open eyes:

• Someone has to be the landlord. Finding tenants, repairs, rent collection and the rules of the Residential Tenancies Act. A property manager costs money; a sibling doing it for free can cause friction.
• Tenancies are hard to end quickly. If the family later wants to sell, a tenant in place limits your timing.
• Income and tax. Rental income is taxable, and it may affect the long-term care rate reduction. Turning a principal residence into a rental can also have capital gains consequences. Talk to an accountant first.
• Market rents. Rentals.ca reported an average asking rent for a three-bedroom in Toronto of $3,642 in August 2026. That is listed apartments and similar units, not houses, so use it only as a rough indicator.

Option 3: Keep it in the family

If a spouse still lives in the house, it usually stays as their home, and nothing needs to change right away. Beyond that:

• A child moves in. This can keep the house occupied and cared for. Agree in writing on who pays tax, insurance and repairs, and what happens when the house is eventually sold.
• Transferring the house to a child. CRA treats a gift of property as a sale at fair market value, and the child is generally considered to have acquired it at that value. A sale below market value to a relative is also treated as a sale at fair market value. A transfer to a spouse usually rolls over at cost.
• Fairness among siblings. Keeping the house for one child affects the others. Talk it through together before anything is signed.

My guide to giving your children money from the house sale covers the gifting questions in more depth.

Who can sign: powers of attorney, and what happens at death

If your parent can still make their own decisions, they can sign the listing and the sale themselves. If they cannot, someone needs legal authority, usually through a continuing power of attorney for property. Without one, ask a lawyer what the options are, because they take time. My guide to power of attorney vs executor in a home sale explains the difference.

A power of attorney ends at death. After that, the executor named in the will deals with the house, often through probate. Ontario’s Estate Administration Tax is $15 for every $1,000 (or part) above the first $50,000 of estate value. As an illustration only, a house worth the City of Toronto detached median of $1,170,000, if it passed through the estate, would attract about ($1,170,000 − $50,000) ÷ 1,000 × $15 = $16,800. Whether the house forms part of the estate depends on how it is owned, which is a question for a lawyer. See executor selling a home in Ontario and selling a house after death and probate.

The empty house: insurance and upkeep

An empty house is a different risk from an occupied one, and home insurance policies often treat it differently. I am not going to tell you what your policy says, because it varies. Call the insurer before the house sits empty and ask:

• Does my policy change if the house is unoccupied, and after how long?
• What conditions do you require: regular inspections, heat left on, water shut off?
• Do I need a different policy or an endorsement while it is vacant or for sale?
• Who needs to be named on the policy if a power of attorney is managing the house?

Then set up a routine: someone checks the house regularly, keeps the heat on in winter, clears snow and mail, and keeps a log. Property tax, utilities and insurance keep running while you decide, and some local seniors’ tax relief programs require the owner to live in the home, so check any existing relief with the city.

Next steps

1. Confirm who has power of attorney for property, and that the document is current.
2. Apply for the rate reduction within 90 days if your parent’s income is low.
3. Call the insurer before the house is empty.
4. Talk to an accountant about the principal residence and the tax on selling, renting or transferring.
5. Agree as a family on sell, rent or keep, and write it down.
6. If you sell, clear the house after the move; my guide to clearing a family home can help.

If you would like a calm, no-pressure conversation about the house and what it might sell for, book a call or phone me at 833-330-1925.

Frequently asked questions

Sources

• Government of Ontario — Paying for long-term care — July 2026 co-payments, rate reduction rules, assets excluded
• Government of Ontario — Apply for long-term care — five homes, 24 hours, five days, 12 weeks
• Government of Ontario — About long-term care — apply through Ontario Health atHome
• Ontario Long Term Care Association — The Data: Long-Term Care in Ontario — waitlist and wait times (industry figures)
• Government of Canada — Old Age Security payment amounts — OAS 75+ maximum, July to September 2026
• Government of Canada — CPP retirement pension: How much you could receive — average new CPP pension
• Canada Revenue Agency — Principal residence — definition and one designation per family per year
• Canada Revenue Agency — Reporting the sale of your principal residence — Schedule 3, T2091, late-designation penalty
• Canada Revenue Agency — Transfers of capital property — gift of property as deemed sale; spousal rollover
• Government of Ontario — Estate Administration Tax — $15 per $1,000 above $50,000
• TRREB — Market Watch, August 2026 — detached medians
• Rentals.ca — National Rent Report — Toronto three-bedroom asking rent, August 2026

Related reading

• Best Places to Retire in the GTA (2026): A City-by-City Comparison
• Retirement Home vs Long-Term Care in Ontario
• Power of attorney vs executor in a home sale
• Executor selling a home in Ontario
• Selling a house after death: probate
• Selling the House to Pay for a Retirement Home
• Clearing a family home
• How to Talk to Your Parents About Downsizing