Purchasing a resale house or condo is not the only option available when looking for a new home. There is always the option of purchasing pre construction homes. This option allows homebuyers to move into a brand new “move-in-ready” home with personalized interior design accents. There is also the added bonus of having a home warranty.
However, the process of purchasing a pre construction home is different that a resale home. Below you will find a few thing you must consider when thinking about purchasing a pre construction home.
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Be Sure To Visit The Project Site
Add everything to the purchase agreement
Cooling Off Period for Pre Construction Homes
Research the Builder
Start by finding a reputable pre-construction project in your desired area. In Ontario, there’s no shortage of new builds in urban centers like Guelph, Kitchener-Waterloo, Toronto, and the GTA.
Before committing, research the builder’s reputation:
- Visit one of their completed communities and talk to homeowners about their experience.
- Check online reviews and real estate forums. Look for patterns, not one-off complaints.
- Ask your real estate agent if they’ve worked with the builder before—they often have valuable inside knowledge.
Is the Builder Licensed?
In Ontario, you can confirm a builder’s licensing status through the Ontario Builder Directory. This will show:
- Whether they are licensed to build new homes in the province.
- How many homes they’ve completed.
- Their claims history under the Tarion warranty program.
- Any convictions for illegal building in the past 10 years.
This step is crucial—working with a licensed builder ensures your home will be covered by Ontario’s mandatory new home warranty protections.
Be Sure to Visit the Project Site
While many buyers purchase pre-construction homes without visiting the location (especially if it’s in another city), an in-person visit is ideal. This lets you see:
- Neighbourhood layout and nearby amenities (schools, parks, grocery stores, gyms).
- Lot sizes, driveway lengths, and any easements.
- Proximity to things like highways, transit, or busy roads.
A local realtor can provide maps and neighbourhood insights to help you choose the best location—whether in Guelph or anywhere else in Ontario.
Visit the Model Home
A model home is meant to impress—and usually contains premium upgrades not included in the base price. Before you fall in love with the finishes:
- Ask for a list of standard features versus upgrades.
- Request a price list for common upgrades (flooring, counters, lighting, appliances).
- Negotiate upgrade prices—builders make a large profit margin here, so there’s often room for discounts, especially if you’re purchasing multiple upgrades.
Add Everything to the Purchase Agreement
Verbal promises mean nothing in real estate. Ensure everything you’ve discussed is written into the agreement, including:
- Exact finishes, upgrades, and materials.
- How delays will be handled.
- What happens if the project is cancelled.
- Deposit payment schedules.
- Deadlines for making design and upgrade decisions.
Cooling Off Period for Pre Construction Homes
In Ontario, there’s a mandatory 10-day cooling-off period for new condo purchases (some builders extend it to freehold homes). During this time you can:
- Have a real estate lawyer review your agreement.
- Secure financing approval.
- Cancel your purchase without penalty if you change your mind.
What About a Mortgage?
Buying pre-construction often means you won’t take possession for 1–5 years, so your financing needs extra planning:
- Work with a mortgage broker familiar with pre-construction timelines.
- Decide between fixed and variable rates—and whether you want a rate hold.
- Confirm with your lender that they’ll honour the approval when the property is ready (some approvals expire).
Customize Your Home
One of the biggest perks of pre-construction is customization. You’ll work with the builder’s design team to select:
- Flooring, cabinetry, countertops, and paint colours.
- Plumbing and lighting fixtures.
- Layout changes (if allowed).
Remember—upgrades can add up quickly. Set a realistic budget before your design appointment.
Pre Delivery Home Inspection (PDI)
Before you get the keys, you’ll complete a mandatory Pre-Delivery Inspection with the builder. This is your chance to:
- Confirm the home matches the agreement.
- Document deficiencies in writing.
- Have the builder sign off on items that need fixing.
Note: This is not a traditional home inspection. You can still hire your own inspector for added peace of mind.
Interim and Final Occupancy
For condos, there are two stages:
- Interim Occupancy – You can move in but don’t yet own the unit. You’ll pay an occupancy fee until the building is registered.
- Final Closing – Title transfers to you, your mortgage starts, and you become the official owner.
For freehold homes, you typically go straight to final closing once the home is complete.
Things to Keep in Mind
- HST/GST – Unlike resale homes, pre-construction homes don’t always include HST in the price. You may qualify for an HST rebate if you’re an end-user.
- Delays are common – Always plan for flexibility. A “2026” closing could easily become 2027.
- First-time buyer programs – Look into the First-Time Home Buyer Incentive and Ontario’s Land Transfer Tax rebate if you qualify.
Conclusion
Buying a pre-construction home in 2025 can be exciting—especially with the chance to design it to your taste and benefit from a new home warranty. But it also requires careful planning, due diligence, and the right professional guidance.
If you’re thinking of buying in Guelph or the surrounding area, Beth and Ryan are local realtors with experience in pre-construction purchases. They can help you research builders, negotiate upgrades, and make sure your agreement protects your investment.