The Truth About Buying A Pre-construction Condo In Toronto

Toronto is Canada’s largest city, and there’s no doubt the metropolis is in the midst of a condo boom. Just take a look at the skyline and you’ll see an endless supply of cranes and construction workers working at a feverish pace. So today, we’re going to discuss the details surrounding pre-construction units in the Greater Toronto Area.



In most cases, a builder will demand a deposit upfront, even before the condo is finished. The amount of the deposit ranges from 15 to 20 per cent, which can be paid in installments over the course of a few months.

So it’s essential to have the adequate amount of cash-on-hand before looking at these types of properties across the Greater Toronto Area. For example, if you’re looking at a condo that’s $500,000, it’s wise to have between $80,000 to $100,000 in savings.


Decision Making

Let’s be real; buying a condo is a massive purchase – especially if you’re a young first-time buyer. In some situations, people can get a little spooked when it comes to the finances and the responsibility, which is why Ontario has something called the “cooling off period.”

This rule allows buyers to back out of an agreement within the first ten days of signing on the dotted line. Note that this period does include weekends, so don’t wait until it’s too late to retract your offer.



Once you sign an agreement and pay the deposit, don’t expect your condo to be completed the following month. Construction projects take a long time, especially if it’s a high-rise featuring 100-plus units. Ask the builder for the estimated completion date and tack on an extra six months because there are typically delays and last-minute fixes.


Lower Condo Fees

Savvy property investors tend to gravitate towards pre-construction units because they’re brand new. There are virtually no repairs for the first ten years, and the builder covers small fixes under warranty. How will this impact the buyer though? Well, you’ll have lower condo fees for the first decade, which allows the condo association to create a reserve of cash for the coming years.



When purchasing a pre-constructed condo, you’ll have to pay the HST – otherwise known as the Harmonized Sales Tax in Ontario. Although primary residents can apply for the HST rebate and save thousands of dollars, property investors will have to pay 13 per cent of the entire value of the property.

As Toronto is in the midst of this construction phase, so it’s crucial to know all the facts before purchasing a pre-construction unit. For more information, check out

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