Buying a Newly Built Condominium
When you buy a unit in a newly built condominium directly from a builder, Ontario’s Condominium Act, 1998 gives you specific protections:
- You have the right to cancel the purchase of a newly built condo within a 10-day cooling-off period.
- The clock starts from the time you receive a copy of the signed purchase and sale agreement or the disclosure statement (whichever comes later).
- You also have the right to cancel a sales agreement within 10 days after any significant change to the disclosure statement.
- If you exercise your right to cancel, the builder must promptly refund any deposit plus interest.
- If you make a deposit, the builder must ensure that it is held in trust.
- A builder can’t terminate your purchase and sale agreement without your consent.
- Like all new home purchases, newly built condo units are covered by Ontario’s New Home Warranty Plan, which is overseen by Tarion Warranty Corporation.
- The new home warranty also covers deposits of up to $20,000 if your builder goes bankrupt. Visit Tarion’s website to learn more about deposit protection.
Your Builder’s Obligations
The Condominium Act also protects you by imposing certain obligations on condo builders.
- Builders must take all reasonable steps to finish the condo project on time. You may have a right to compensation if your condo closing is unreasonably delayed.
- The builder must register the legal documents necessary to set up the condo corporation without delay.
Disclosure Statement, Bylaws and Rules
The builder must also provide you with a disclosure statement which includes:
- a table of contents
- a general description of the property
- any restrictions on pets
- the condo corporation’s current budget, showing costs for items like staff, maintenance and utilities
- the number of units the builder intends to lease
- the estimated completion date for the construction of amenities
- the declaration, which sets out the definition of units and common elements
- the bylaws and rules, which set out how the condo will be run.
You should review the disclosure documents with your lawyer.