Buying A New Home?
Navigating New Construction Purchases
Buying a brand-new home? Understand the unique taxes, builder adjustments, and warranties involved in a pre-construction or new build transaction.
Navigating New Construction Purchases
Buying a brand-new home? Understand the unique taxes, builder adjustments, and warranties involved in a pre-construction or new build transaction.
Purchasing a brand-new home directly from a builder is an exciting milestone, but it comes with a different financial landscape than buying a resale property. New construction purchases can involve additional costs, specific tax rules, and complex builder adjustments that are not typically found in traditional real estate transactions. Because builder agreements can be intricate, it is crucial to understand exactly what you are financially responsible for on closing day. Here are the key considerations when buying a new build:
New Construction Purchases
Learn what to expect when buying directly from a builder, how HST applies to new homes, and how to prepare for new-construction closing day.
HST
HST treatment for a new home can be different from a resale property, and rebates may be available depending on the purchase price, buyer eligibility, and type of property.
If you are considering a new build, it is particularly important to understand how HST and any applicable rebates are treated in your Agreement of Purchase and Sale.
There are currently enhanced federal and Ontario first-time homebuyer rebates, as well as temporary Ontario enhanced housing rebates for certain new homes purchased from builders. Eligibility and timing requirements apply.
Tarion
New homes in Ontario are covered by the provincial new home warranty and protection program administered by Tarion.
Your agreement of purchase and sale will outline how applicable taxes, rebates, and other new-construction costs are treated.
New-build Closing Costs
Depending on the property and agreement, additional costs may include:
- Development or education levies
- Utility connection charges
- Meter installation
- Tarion-related costs
- HST or HST adjustments
- Assignment or administration fees
- Other builder-specific closing adjustments
New construction contracts can be complex. We’ll review the details carefully so you understand what you may be responsible for before you commit.