New construction homes appeal to buyers for many reasons: they’re brand new with no issues from previous owners, everything should be working accordingly since it’s all modern design and appliances, you can choose your own features and the payment is staggered, unlike a resale property deal. Because the process for a new construction home is a little more extensive than a resale building, here’s what you need to know about the home buying process for new construction homes and buying a house from a builder. 

big detached home

Using an agent won’t cost you

A lot of people are averse to using real estate agents because they want to avoid paying a commission and are worried that the agent won’t be selling them a good deal. But in preconstruction the buyer does not pay the agent’s commission, instead, the builder does. There are a ton of real estate agents that specialize in pre-construction homes and are not affiliated with one specific developer, meaning they have no bias and won’t try to peddle you into a bad deal. Therefore, an agent in this situation is able to highlight all the best developments currently on the market and find one best suited to your criteria and needs. 

Research the builder 

While a good agent will be able to tell you which developers to trust and which ones to steer clear from, it’s always good to do your own research when buying a new build house. 

Not all developers are the same, there are some that are more widely known and have better reputations than others. When buying a house from a builder, you’ll need to do some research into the company. You should be checking to see how many projects they have successfully completed,  how many they canceled, and if any projects were significantly delayed. 

There are quite a few builders that might look good on paper and seem to have fantastic deals on units, but end up canceling the project after buyers submit their deposits. If a builder cancels the project, the initial deposit the buyer pays on signing is not returned. This is why it’s crucial to know if the developer you are signing with has a good reputation and a strong history of successful projects. 

While many developments for new build homes can get delayed for various reasons such as weather, and issues obtaining materials, you still want to make sure your project stays on track as much as a builder can control it.

At Paradise Developments, we pride ourselves on being the Greater Toronto Area’s top builder of new communities.

Pricing structure 

Many people think new construction homes are cheaper to buy than resale properties but that’s not always the case. When buying a new home from a builder in Ontario it’s important to note that properties are priced by the builder based on land costs, development fees and charges, and construction costs. Those three factors never really go down in price, and as Ontario grows in population size, the demand for more housing increases, therefore so does the price of land.  

Typically in pre-construction when you sign the contract on your lot or unit, you’ll be required to put down a portion of the price as your deposit. Then over time, you’ll be required to pay another percentage of the sales price until closing. For example, you might need to pay:

  • 5% 30 days after closing 
  • 5% 60 days after closing 
  • 5% 90 days after closing 
  • 5% at occupancy. 

Each development will have its own unique payment structure and deposit ratios. So while you may only need to put 5% down on development, another builder might require you to put 10% down. Always ask for a breakdown of the payment structure before buying a new build house to ensure that you’ll be able to make the scheduled deposits. 


Another way in which the new construction home buying process differs from a resale property is the lack of negotiation. Builder pricing is usually set in stone due to the cost of land and materials previously mentioned. However, the opportunity for negotiations lies in the upgrades you can choose. Every pre-construction project, be it a house or condo, allows the buys to choose from a limited amount of design options to customize the home more to their taste. 

You can choose from standard packages that don’t really require additional costs or you can opt to pay more money for more top of the line finishes. You might be able to wrangle a deal and compromise on your desired upgrades or slight alternatives to your selected floorplan (i.e an extra bathroom instead of a walk-in closet). It might not be the biggest of savings, but saving a little when you’re buying a new home can be used in other aspects of the purchase. 

How upgrades work

Speaking of upgrades, it’s important to be aware that when buying a new build house the builder will likely include a few premium features in the model home. So when you’re walking through the model home, or going to the sales center and looking at the renderings of condo units, what you see may not always be what you get. You should be looking at the layouts of the room and the size of the property. If it’s a preconstruction townhouse, look into HOA and maintenance fees. 

Falling in love with the fancy finishes is a great way for the builder to convince buyers into spending more than they need to. So make sure you know what you’re buying based on the base price. 

Buying a house from a builder in Ontario can bring a lot of benefits for buyers. You won’t need to pay an agent a commission ensuring you’re privy to the best deals and developments in the province. Rest assured that you’ll be getting a new home without any of the potential issues an older home would have. You wouldn’t need any additional renovations when you move in and you get to select what finishes and features you’d like in your home.