Back to guidesAssignment The sale of your rights under a purchase agreement to another buyer before the building closes. You're selling the contract, not the unit (because you don't own it yet). Builders often restrict or charge fees for assignments — check your agreement carefully. Cap on closing cost adjustments Some purchase agreements allow builders to pass through unexpected costs (development charges, education levies, utility connection fees) at closing. A cap limits your exposure. Without one, you could owe tens of thousands more than expected. Condominium declaration The legal document that formally creates the condominium corporation and establishes the rights and obligations of unit owners. Part of the disclosure statement you receive before or at signing. Cooling-off period The 10-calendar-day statutory rescission period under Ontario's Condominium Act, during which you can cancel a pre-construction condo purchase for any reason and receive a full deposit refund. Starts the day after you receive both the signed agreement and the disclosure statement. Development charges (DCs) Fees charged by municipalities to builders to fund growth-related infrastructure — roads, transit, water, parks. Builders typically pass these through to buyers at closing. They vary significantly by municipality and project type. Ask for a cap in your purchase agreement. Disclosure statement A legally required package of documents provided by the builder before or at signing. Includes the proposed declaration, first-year budget, reserve fund study, site plan, and material facts. The cooling-off period doesn't start until you receive it. Final closing The date when the condominium is registered with the province, title transfers to buyers, and mortgages activate. Different from occupancy date (when you move in). The period between occupancy and final closing is the interim occupancy period. Force majeure A contract clause that excuses a party from performing their obligations due to extraordinary events — pandemics, strikes, government action. Broad force majeure clauses give builders significant flexibility to delay closing without penalty. HST new home rebate Ontario new homes are subject to HST, but buyers of owner-occupied homes priced under $450,000 are eligible for a rebate of up to $30,000. For homes priced above that threshold, the rebate phases out. Builder prices are often stated as HST-inclusive with the rebate assigned back to the builder — meaning if you don't qualify, you owe additional HST. Interim occupancy The period between when you take possession of your condo unit and when the building is registered and final closing occurs. During this time, you pay an interim occupancy fee (interest on unpaid balance + property tax estimate + common element estimate) instead of mortgage payments. No equity is built during this period. Interim occupancy fee (IOF) The monthly fee paid to the builder during interim occupancy. Capped by Ontario law at three components: prescribed interest on the unpaid balance of the purchase price, a property tax allocation, and an estimated common element fee. Does not reduce the purchase price. Land transfer tax (LTT) A provincial tax paid by the buyer on the transfer of property. Ontario uses a graduated rate schedule. Toronto properties are also subject to a municipal land transfer tax (MLTT) at roughly the same rates. First-time buyers are eligible for rebates of up to $4,000 (Ontario) and $4,475 (Toronto MLTT). Occupancy date The date you're permitted to move into your unit, even though you don't yet own it. Builders provide a firm and outside occupancy date in the purchase agreement — and can extend to the outside date. After the outside date, you may be entitled to compensation. Outside occupancy date The latest date by which the builder must give you occupancy, as stated in the purchase agreement. After this date, you can typically terminate the agreement and receive your deposits back, or negotiate compensation if you choose to stay. Prescribed interest rate The rate used to calculate the interest component of your interim occupancy fee, set under Ontario regulation at the Bank of Canada overnight rate plus 2%. Updated quarterly. Purchase agreement The binding contract between you and the builder. Sets out the purchase price, unit specifications, deposit schedule, closing date, and both parties' rights and obligations. Read it with a lawyer before signing — it's typically 50–80 pages and heavily favours the builder. Reserve fund A fund maintained by the condo corporation to cover major repairs and replacements of common elements (roof, elevators, windows). The initial contribution is set in the first-year budget. Underfunded reserves are a red flag — future owners face special assessments. Tarion Ontario's new home warranty program, administered under the New Home Construction Licensing Act. Provides statutory warranty coverage on new construction (one year on workmanship and materials, two years on mechanical systems, seven years on major structural defects) and protects deposits up to $100,000 for condos. Unit specification sheet A document listing the included finishes, appliances, and features for your specific suite — flooring, cabinets, countertops, bathroom fixtures. What's included varies by project and builder tier. Upgrades above the standard spec are priced separately. Worksheet A pre-contract document that holds a specific unit for you while the purchase agreement is prepared. Signing a worksheet does not create a binding purchase agreement, but typically requires a deposit. Not the same as signing the agreement.
Buyer Guide · Reference
Pre-Construction Glossary
Plain-English definitions for the terms you'll encounter when buying pre-construction in Ontario.