Buying a pre-construction condo in Ontario

You have 10 days to change your mind

When you buy a new condo from a builder in Ontario, you have a 10-day cooling-off period. It starts when you receive the signed agreement and the disclosure statement. Use it: have a lawyer who knows pre-construction review the agreement, and line up your mortgage pre-approval.

Deposits are paid in stages

Instead of one deposit, you usually pay several over the first year or two. Deposits on new condos must be held in trust, and Tarion's deposit protection adds a further layer of cover up to a set limit.

Occupancy comes before closing

Your unit will usually be ready before the building is registered. During that gap, called interim occupancy, you can move in but you do not own the unit yet. You pay the builder a monthly occupancy fee, which is not a mortgage payment and does not reduce what you owe.

Budget for closing costs

On top of land transfer tax and legal fees, new condos come with adjustments such as development charges, utility connection fees and Tarion enrolment. Ask for these to be capped in your agreement, and ask your lawyer what a realistic total looks like. How HST and any rebate apply depends on whether you will live in the unit or rent it out, so confirm that with your lawyer or accountant early.

Dates move

Occupancy dates in the agreement are tentative and builders are allowed to extend them within set limits. Plan your current housing with that in mind.

Know your assignment rights

If your plans change before closing, you may be able to sell your agreement to another buyer. Whether you can, and what the builder charges, is set by the assignment clause, so negotiate it at the start. See how assignment sales work.