Buying Pre Construction


  1. Pre-construction Phase
  2. Construction Phase
  3. Interim Occupancy Period
  4. Title Transfer (Final Closing)


  • held “in trust” by developer’s lawyer
  • deposits are fully insured
  • interest is paid from date of deposit to occupancy at Act prescribed rate
  • NSF cheques are subject to administrative fees


  • Can be assigned to immediate family wihtou penalty
  • Assignment Clause reuqired for non-family, but assignee remains responsible for closing on unit if assignor defaults


  • Included in the purchase price if you are an owner-occupant
  • Investors are responsible for paying rebate portion on final closing, but can apply to CRA for full refund after leasing unit for 1 year.


  • Includes:
  1. Disclosure Statement
  2. Budget Statement for Year 1 operations
  3. Proposed Declaration
  4. Proposed By-Laws
  5. Proposed Rules
  6. Proposed Management Agreement
  7. Preliminary Draft Plan of Condominium (excluding parking levels)
  • Defines what items are considered part of your unit and what items are considered part of the common elements
  • Defines how common element fees (maintenance fees) are calculated
  • Names the Property Management Company for Year 1
  • Details how the condominium corporation is to operate and make decisions


  • Developer has right to substitute material of equal or better quality as materials may become discontinued from time of pre-sales to contruction
  • Colour selections typically start 12 months prior to occupancy
  • Upgrades and pricing are usually not available until colour selection time as availability of materials and pricing at time of pre-sales may change by the time contruction commences
  • Upgrades are usually payable 100% at time of selection


  • Period between possession of the unit (occupancy) and title transfer date (final closing) when your mortgage kicks in and you become the legal owner
  • Occupancy Fee is payable to Vendor during this period, calculated as:
  1. interest in unpaid balance of purchase price, plus
  2. estimated municipal realty taxes
  3. common expenses (maintenance fees)
  • Occupancy fee does not go towards your mortgage
  • Occupancy period varies, but typically 3-6 months
  • You cannot lease your unit during occupancy period, unless you have signed an Authourization to Lease with the Developer


  • all new home builders are required to be registered with Tarion Warranty Corporation
  • all new homes proctected under Ontario New Home Warranties Act
  • includes protection for deposits, workmanship and delays
  • 1-year warranty: units to be constructed in workmanlike manner and free from defects in materials
  • 2-year warranty: covers water penetration of building envelope; electrical plumbing and heating systems; and exterior cladding
  • 7-year warranty: covers major structural defects
  • all deficiencies documented at Pre-Delivery Inspection (PDI) on Tarion Certificate of Completion and Possession Form


  • Land Trasnfer Tax – Ontario + Toronto
  • Adjustments, which are determind at Title Transfer Date (final closing), but may be “capped” if requested
  • Adjustments includes:
  1. realty taxes estimated from Occupancy to Title Transfer Date
  2. PST on chattels (i.e. appliances)
  3. new taxes imposed by government
  4. increase in development and/or education development charges
  5. Tarion Warranty Corporation enrollment fee
  6. Park Levies imposed by government
  7. utility meters and connection charges
  8. HST (if non-owner occupant)
  • Legal Fees