Quick answer: Buying a pre-construction home in the GTA means signing a builder’s agreement today, paying a deposit in stages (commonly 15 to 20 percent over 12 to 24 months) and closing when the home is finished, often two to four years later. Before signing, confirm the builder on the HCRA directory, have a lawyer review the agreement in your 10-day period, and budget for HST, land transfer tax and closing adjustments on top of the price.
How buying pre-construction works
- Get pre-approved. Lenders qualify you at the higher of your contract rate plus 2 percent or 5.25 percent (OSFI rule, summarized by zealty.ca, checked Oct 30, 2026). The mortgage itself is arranged closer to closing, so a pre-approval is a budget check, not a guarantee.
- Register and pick a unit. Builders release plans in phases. Registering through the New Homes Team at RE/MAX Gold Realty Inc., Brokerage usually means access before public release, at no cost to you.
- Sign the Agreement of Purchase and Sale. A builder-drafted contract, not a standard OREA form, with the deposit schedule, closing adjustments and Tarion addendum.
- Use your 10-day period. Condo buyers get 10 days after receiving the signed agreement and disclosure statement to cancel for any reason (Condominium Authority of Ontario buyers’ guide, checked Oct 30, 2026). Have a lawyer review the agreement in this window.
- Pay deposits on schedule. Instalments fall on fixed dates, not construction milestones.
- Interim occupancy (condos). You move in before registration and pay a monthly occupancy fee until final closing.
- Final closing. The mortgage funds, the balance is paid and title transfers.
Deposits and the deposit schedule
Pre-construction deposits are larger than resale deposits and paid in instalments. A common GTA structure is 15 to 20 percent of the price over 12 to 24 months: $5,000 on signing, the balance to 5 percent in 30 days, then 5 percent at 90, 180 and 365 days, sometimes with a final 5 percent at occupancy (storeys.com, checked Oct 30, 2026). Freehold deposits are often lower in total.
Treat deposits as cash. Lenders do not finance them, and each instalment must clear on its date.
HST and rebates
New homes carry 13 percent HST. GTA builder prices are usually quoted “HST included” on the assumption that you qualify for the new housing rebate and assign it to the builder. If you do not qualify, for example because the home will not be your primary residence, you pay the rebate amount on closing.
Three rebates matter in 2026:
- Ontario new housing rebate (all qualifying buyers). A rebate of the provincial portion of HST, capped at $24,000, on a home at any price that will be your primary residence (Canada Revenue Agency and TRREB summary, checked Oct 30, 2026).
- Federal First-Time Home Buyers’ GST rebate. Bill C-4 received Royal Assent on March 12, 2026. It rebates the full 5 percent GST up to $50,000 on new homes up to $1,000,000, phases out between $1,000,000 and $1,500,000, and is nil at $1,500,000 or more. It covers agreements signed on or after March 20, 2025 and before 2031; at least one buyer must be a first-time buyer, 18 or older, and a citizen or permanent resident (pushormitchell.com, checked Oct 30, 2026).
- Ontario’s enhanced HST rebate (announced March 2026). Full 13 percent HST rebated on new homes up to $1,000,000, a flat $130,000 from $1,000,001 to $1,500,000, declining to $24,000 at $1,850,000. It applies to builder agreements signed April 1, 2026 to March 31, 2027 with construction starting by December 31, 2028, and is subject to federal legislation and CRA administration (legal500.com and TRREB fact sheet, checked Oct 30, 2026).
Rebate rules change and are claimed through CRA forms, so confirm eligibility with your lawyer or accountant.
Land transfer tax
Ontario land transfer tax is paid on closing on the price net of HST: 0.5 percent on the first $55,000, 1 percent to $250,000, 1.5 percent to $400,000, 2 percent to $2,000,000, and 2.5 percent above that for one or two unit homes. First-time buyers can claim a refund of up to $4,000 (wowa.ca, checked Oct 30, 2026).
Inside the City of Toronto a second municipal land transfer tax applies at the same schedule up to $3,000,000, with higher tiers above; Toronto’s first-time buyer rebate is up to $4,475 (wowa.ca, checked Oct 30, 2026). Peel, York and Halton municipalities have no municipal land transfer tax.
On a $900,000 home that is $14,475 in Ontario tax, and $28,950 in Toronto, before first-time buyer refunds. Run your own numbers with the PreconMap calculators.
Closing costs people forget
- Development charges, levies and education charges. Builder agreements pass increases on as adjustments, so ask for a dollar cap before you sign. For scale, Mississauga’s city development charge is $53,363 per single or semi-detached home and $36,371 per apartment unit as of August 1, 2026, before Region of Peel and school board charges (mississauga.ca, checked Oct 30, 2026).
- Tarion enrolment fee. Charged per home and usually passed to the buyer: $661.05 including HST on a home up to $300,000, $2,344.75 between $950,000 and $1,000,000, and $2,615.95 between $1,250,000 and $1,500,000, effective September 1, 2025 (tarion.com, checked Oct 30, 2026).
- Lawyer fees, utility hookups and meters. Legal fees cover the agreement review and the closing; hydro, gas and water meter installation and connection fees appear as adjustments on freehold homes.
- Interim occupancy fees (condos). Under section 80 of the Condominium Act the monthly fee is interest on the unpaid balance at the Bank of Canada one-year conventional rate, plus estimated property tax and maintenance fees. None of it is credited to the price, and the period can run for months (mondaq.com, checked Oct 30, 2026).
- Other adjustments. Tree planting, driveway paving, grading deposits and tax prorations. Ask your lawyer for a total estimate.
Protection: Tarion, HCRA and the 10-day period
Tarion warranty
Every new home sold by a licensed Ontario builder carries the statutory warranty administered by Tarion: one year on workmanship and materials, two years on major systems such as plumbing, electrical and the building envelope, and seven years on major structural defects (tarion.com, checked Oct 30, 2026).
Tarion deposit protection
Freehold deposits are protected up to $60,000 on homes priced at $600,000 or less, and 10 percent of the price up to $100,000 above $600,000. From January 1, 2026, freehold buyers who register with Tarion within 45 days of signing qualify for the maximum; late registrations may receive less (tarion.com and mondaq.com, checked Oct 30, 2026). Condo deposits must be held in trust under the Condominium Act, with Tarion coverage up to $20,000 if a builder fails to return a deposit (tarion.com, checked Oct 30, 2026).
HCRA builder licensing
The Home Construction Regulatory Authority licenses every builder and vendor of new homes in Ontario. Search the Ontario Builder Directory before signing to confirm the licence is active and review the builder’s history, including conditions and complaints (hcraontario.ca, checked Oct 30, 2026).
The 10-day period
Condo buyers have 10 days from receipt of the signed agreement and disclosure statement to rescind with the full deposit returned (Condominium Authority of Ontario, checked Oct 30, 2026). For freehold homes, the Homeowner Protection Act, 2024 created a matching 10-day cooling-off period; Tarion states the supporting regulations and mandatory information sheets take effect January 1, 2027 (tarion.com, checked Oct 30, 2026). If you sign a freehold agreement before that date, assume there is no automatic cancellation right.
Condo vs townhome vs detached in 2026
| Condo apartment | Townhome (freehold or condo) | Detached | |
|---|---|---|---|
| Typical deposit | 15 to 20% over 12 to 24 months | 10 to 20% | 10 to 15%, sometimes lower |
| Interim occupancy | Yes, usually | Only for condo townhomes | No |
| Deposit protection (Tarion) | $20,000 plus trust | Depends on tenure | Up to $100,000 |
| Cancellation right | 10 days now | 10 days if condo | From Jan 1, 2027 |
| Typical build time | 3 to 5 years | 18 to 36 months | 12 to 30 months |
The practical differences are cash timing and risk. Condos carry the longest wait and the occupancy-fee period; freehold townhomes and detached homes close once. Many Peel and Halton releases in 2026 are freehold, so the freehold deposit and cooling-off rules above matter more than they used to.
Where to look
PreconMap lists GTA pre-construction projects by location and status. Start with the interactive map, filter to launching soon, browse condos or townhomes by type, and Brampton or Mississauga by city. The calculators cover land transfer tax, deposit schedules and closing costs. The New Homes Team at RE/MAX Gold Realty Inc., Brokerage can register you for a release and walk through the agreement before your 10-day period starts.
Frequently asked questions
How much deposit do I need for a pre-construction home in the GTA?
Most builders ask for 15 to 20 percent of the price in instalments over 12 to 24 months, with 5 percent due in the first 30 days. Freehold homes often require less. Deposits must be your own funds, since lenders do not finance them.
Do I pay HST on a pre-construction home?
Yes, 13 percent HST applies. GTA builder prices are usually quoted with the new housing rebate included, which requires the home to be your primary residence. First-time buyers may also qualify for the federal GST rebate of up to $50,000 on homes up to $1,000,000, and Ontario has announced an enhanced rebate for agreements signed April 1, 2026 to March 31, 2027. Confirm eligibility with your accountant.
Is my deposit protected if the builder cancels?
Tarion protects freehold deposits up to $60,000 or $100,000 depending on price, and condo deposits up to $20,000, with condo deposits also held in trust under the Condominium Act. Freehold buyers should register with Tarion within 45 days of signing to keep the maximum coverage.
Can I cancel after signing?
Condo buyers have 10 days after receiving the signed agreement and disclosure statement to cancel for any reason. Freehold buyers will have a similar 10-day right when the Homeowner Protection Act regulations take effect on January 1, 2027. Outside those windows, cancellation depends on the agreement and usually means losing the deposit.
What is interim occupancy and how long does it last?
It is the period after you take the keys to a condo but before the building is registered and title transfers. You pay a monthly fee made up of interest on the unpaid balance, estimated taxes and maintenance fees. It commonly lasts three to twelve months but can run longer in large towers.
Can I assign my pre-construction purchase before closing?
Only if the agreement allows it. Most GTA builders permit assignment after a set percentage of units are sold, charge an assignment fee and require written consent. HST and income tax on assignment profits have specific rules, so get legal and accounting advice first.
This article is general information, not legal, tax or financial advice. Confirm all figures and your eligibility with a licensed lawyer, accountant or mortgage professional before signing.
Sandeep Pawar, BrokerABR · SRS · SRES · RENERE/MAX Gold Realty Inc., Brokerage
