Sandeep Pawar
Broker
Pre-construction homes in Ontario: what to check before you sign
In my experience, pre-construction buyers get hurt less by fraud than by signing a long agreement, written by the builder’s lawyer, without reading it. Here is what to check, and the protections the law gives you.
The short answer: before you sign, check the builder’s licence, the deposit schedule, closing adjustments, delay terms and assignment rights. New condo buyers get a 10-day cooling-off period under the Condominium Act. Tarion protects condo deposits up to $20,000, and freehold deposits up to $60,000, or 10% to a maximum of $100,000 above $600,000. On a freehold home, delayed closing compensation is capped at $7,500. First-time buyers may get back up to the full 13% HST on homes up to $1 million.
Condo or freehold: different protections
| New condominium unit | New freehold home | |
|---|---|---|
| Deposit protection | Held in trust under the Condominium Act; Tarion covers up to $20,000. | Tarion covers up to $60,000 (price $600,000 or less) or 10% to $100,000 (above $600,000). |
| Cooling-off period | 10 days under section 73 of the Condominium Act. | No statutory cooling-off. Review before you sign. |
| Living there before you own it | Interim occupancy, with monthly occupancy fees, until the condo is registered. | Usually you close and move in on the same day. |
| Delays | Tarion delayed occupancy coverage. | Tarion delayed closing coverage, up to $7,500. |
| Warranty | One, two and seven year coverage. | One, two and seven year coverage. |
Tarion plans new rules for freehold deposits: buyers would register their agreement with Tarion within 45 days of signing to get full coverage. Tarion has deferred these changes to 1 January 2027. Check the rules on your signing date.
Check the builder
Before you fall for the floor plan, check who is building it.
What happens
New home builders and sellers in Ontario are licensed and regulated by the Home Construction Regulatory Authority (HCRA).
What you do
Search the builder in HCRA’s Ontario Builder Directory. Look at its past projects, delays and completed buildings.
Documents and people
Builder’s name and licence details, past project addresses.
Watch for
Numbered companies with no history, and projects with no clear construction timeline.
How I help
I look at the builder’s track record and how its past projects have resold before you commit.
Read the whole agreement
The agreement and its schedules decide what you pay at closing, when you close, and whether you can sell early.
What happens
You receive the agreement, the schedules, the Tarion addendum and, for a condo, the disclosure statement.
What you do
Read the deposit schedule, closing adjustments, delay provisions and assignment clause first.
Documents and people
Agreement of purchase and sale, Tarion addendum, disclosure statement, Condo Buyers’ Guide.
Watch for
Adjustments with no cap, such as development charges, levies and utility connections. These can add a large sum at closing.
How I help
I go through the agreement with you before you sign, and flag what your lawyer should look at closely.
Use the 10-day cooling-off period
For a new condo, this is the most valuable window you get. Most buyers spend it doing nothing.
What happens
Under section 73 of the Condominium Act you have 10 days to cancel, for any reason. The clock starts once you have the signed agreement, the disclosure statement and the Condo Buyers’ Guide.
What you do
Book your lawyer the day you sign. Check financing with a lender. Re-read the budget statement in the disclosure.
Documents and people
Disclosure statement, proposed declaration and by-laws, first-year budget.
Watch for
Missing the deadline. A material change to the disclosure can start a new 10-day window, so read any revised disclosure carefully.
How I help
I help you use the 10 days for a real legal and financial review, not just a second look at the brochure.
Signed recently, or about to? The clock may already be running.
Book a 30-minute callPlan every deposit
Pre-construction deposits are paid in stages, often over a year or more. Plan the cash before you sign.
What happens
You pay deposits on the dates in the schedule. Condo deposits are generally held in trust.
What you do
Map each deposit against your savings. Know what Tarion protects and what it does not.
Documents and people
Deposit schedule, receipts, trust confirmations.
Watch for
Deposits above Tarion’s limits. If the builder fails, anything above the cap is at risk.
How I help
I help you weigh the deposit schedule against your savings plan and the protection available.
Understand delays and dates
New homes are often late. The agreement and Tarion’s rules decide what you get when they are.
What happens
Freehold agreements set a first tentative closing date. The builder can extend it twice, by up to 120 days each, with proper written notice.
What you do
Track the critical dates. At least 90 days’ written notice is generally required to change a closing date.
Documents and people
Tarion addendum with its statement of critical dates.
Watch for
Delays past the outside closing date. You then have 30 days to end the agreement and get your money back with interest.
How I help
I explain your critical dates up front, so you know your rights if the builder is late.
Occupancy, inspection and closing
For a condo, you may live in the unit for months before you own it. Budget for that.
What happens
During interim occupancy you pay a monthly occupancy fee. Final closing follows once the condo is registered.
What you do
Attend the pre-delivery inspection and list every defect. Report warranty items on time.
Documents and people
Pre-delivery inspection form, statement of adjustments, warranty forms.
Watch for
Occupancy fees are not mortgage payments. They build no equity.
How I help
I help you prepare for the inspection and closing adjustments. Closing day checklist.
HST and rebates on new homes
- First-time buyers: the federal rebate returns up to the full 5% GST, to $50,000, on homes up to $1 million, phasing out by $1.5 million. Ontario removes the full 8% provincial part on homes up to $1 million. Both cover agreements from 20 March 2025, to the end of 2030.
- All eligible buyers, temporarily: builder agreements signed from 1 April 2026 to 31 March 2027 may qualify for Ontario’s enhanced relief. It is worth up to $130,000 in total.
- Examples from Ontario: full 13% relief is $91,000 on a $700,000 home and $130,000 on a $1 million home, for eligible buyers.
Details and eligibility are in my first-time buyer guide. Confirm with your lawyer how the rebates are handled in your agreement.
Assignments: selling before you close
- Your agreement decides whether you can assign it, whether the builder must consent, and what fee it charges.
- Since 7 May 2022, all assignment sales of new or substantially renovated homes are taxable for GST/HST. The tax applies to the whole assignment price, including any part described as a return of your deposit.
- Under CRA’s flipping rule, a gain on a home, or a right to acquire one, held under 365 days is generally business income. Some life events, such as death, separation or job loss, are exceptions.
Talk to an accountant before you assign or plan to. General information, not tax advice.
Builder agreement checklist
- Builder found in HCRA’s Ontario Builder Directory
- Deposit schedule fits your savings, and you know Tarion’s limits
- Closing adjustments are listed, and capped where possible
- Tentative, firm and outside closing dates understood
- Occupancy fee estimate for a condo
- Assignment rights and fees in writing
- HST treatment and rebate assignment clause reviewed
- Lawyer booked inside the 10-day cooling-off period, for a condo
- Mortgage plan for a closing that may be years away
Looking for projects?
Every project selling now is on PreconMap.ca, my pre-construction site, with starting prices by city and home type. Search it here, then come back and we go through the agreement before you sign.
Search by city and home type
Brampton projects selling now
Six projects I get asked about most, with starting prices from PreconMap on November 2, 2026. Builders change prices often, so check the project page for the latest.
From $629,990CornerstonePrimont Homes, Brampton. TownhomesSee plans and incentives on PreconMap 
From $999,999NaveraDiGreen Homes, Mayfield Village. DetachedSee plans and incentives on PreconMap 
From $629,990Mount Pleasant WestMattamy Homes, Mount Pleasant, BramptonSee plans and incentives on PreconMap 
From the low $600sRollingwood TownhomesRegency Developments, Brampton. TownhomesSee plans and incentives on PreconMap 
From the $300sDUO CondosNational Homes & Brixen, Brampton. CondosSee plans and incentives on PreconMap 
From the $500sBristol Place CondosSolmar, Brampton. CondosSee plans and incentives on PreconMap Shortlists people ask me for
- Cheapest new townhomes, BramptonThe lowest starting prices on new towns right now.
- Cheapest new townhomes, MississaugaEntry-level new towns west of Toronto.
- Condos near Sheridan CollegeInvestor-friendly units near the Davis campus.
- Double-garage townhomesTowns with two-car garages in Brampton.
- Semis on the Brampton–Caledon borderNew semi-detached homes in the north end.
- Launching soonRegister early for first access and pricing.
Pre-construction in other cities
Mississauga · Caledon · Milton · Georgetown · Oakville · Vaughan · Toronto. See my guide to pre-construction in Mississauga.
Comparing with resale? Read buying a resale home, step by step.
Questions buyers ask
What is the cooling-off period on a new condo in Ontario?
Under section 73 of Ontario’s Condominium Act, you have 10 days to cancel a new condo purchase from the builder, for any reason. The period starts once you have the agreement signed by both sides, the disclosure statement and Ontario’s Condo Buyers’ Guide. Use it for a legal and financial review.
Is there a cooling-off period on a new freehold house?
The 10-day period in the Condominium Act applies to new condominium units. For a freehold home, have your lawyer review the agreement before you sign, or make it conditional on that review.
How much of my deposit does Tarion protect?
For a condo, deposits must generally be held in trust, and Tarion covers up to $20,000 if the builder does not return them. For a freehold home bought on or after 1 January 2018, Tarion covers up to $60,000 on homes priced at $600,000 or less. Above that, it covers 10% of the price, to a maximum of $100,000.
What are occupancy fees?
Monthly payments to the builder while you live in a condo unit before the building is registered and you own it. They are capped at the interest on the unpaid balance, estimated property taxes and projected common expenses. They do not reduce your price.
Can the builder delay my closing?
Yes, within limits. For freehold homes with a tentative date, the builder can extend twice, by up to 120 days each, with proper notice. Beyond that, Tarion’s delayed closing coverage pays up to $7,500, including $150 a day for living expenses.
Can I sell my unit before it closes?
Only if the agreement allows an assignment, and often with the builder’s consent and a fee. Since 7 May 2022 assignment sales of new homes are taxable for GST/HST. A gain on a home or a right to one held under 365 days may be taxed as business income.
Is HST included in a new home price?
Check the agreement. It should say whether HST is included in the price and whether any rebates are assigned to the builder. Whether you qualify, and what happens if you do not, is a question for your lawyer.
What warranty comes with a new home?
Ontario’s new home warranty is backed by Tarion. One year covers workmanship and materials, and two years covers plumbing, heating, electrical and water penetration. Seven years covers major structural defects.
Sources
- Condominium Authority of Ontario: pre-construction condos (cooling-off, trust, occupancy fees)
- Condominium Authority of Ontario: Condo Buyers’ Guide (when the 10 days start)
- Tarion: condo units, occupancy dates and delays
- Tarion: coverage before you move in (deposit protection, 2027 deferral)
- Tarion: freehold coverage for closing dates and delays
- Tarion: your new home comes with a builder’s warranty
- Home Construction Regulatory Authority: Ontario Builder Directory
- CRA: GST/HST on assignment sales (GI-120)
- CRA: principal residence and other real estate (flipping rule)
- CRA: first-time home buyers’ GST/HST rebate
- Ontario.ca: HST relief for new homes (updated 22 July 2026)
Read it before you sign it
Send me the agreement or the project you are considering. I will go through it with you and tell you what I would ask your lawyer to check.