Buying a New Construction Home in Markham: What to Check

What you are actually buying

A resale purchase is an agreement between two owners over a house that exists. A pre-construction purchase is a contract with a builder over something that does not exist yet, on the builder’s paper, with a closing date the builder largely controls.

That is not an argument against it. It is the reason the protections here come from Ontario statutes rather than from anything you negotiate at the sales centre. Know which ones apply to you and the rest of the decision gets much easier.

The 10 day cooling off period, and what starts it

On a pre-construction condominium, you have 10 days in which you may rescind the agreement of purchase and sale.

The detail people get wrong is when the clock starts. It is not the day you sign. The period begins once you receive the disclosure statement and Ontario’s Residential Condominium Buyers’ Guide. Those days are for your lawyer to read the disclosure statement, which is the document that describes the corporation you are buying into.

A freehold new build, a detached home or a freehold townhouse, does not carry the same statutory rescission right. There is no ten day window to change your mind. Everything therefore has to happen before you sign.

Your deposit, and the ceiling on its protection

Pre-construction deposits are large and they are paid in instalments over months.

For a pre-construction condominium, deposits and other payments are protected up to a maximum of $20,000 by Tarion under the Ontario New Home Warranties Plan Act, where a refund is not issued after a project is cancelled.

Read that number against what you are actually paying. Deposit structures on a Markham condo routinely run far past $20,000. The statutory protection is a floor under the worst case rather than full cover. What sits above it depends on the agreement and on where the money is held. Ask your lawyer that question specifically.

What the warranty covers, and for how long

Tarion’s coverage runs in three periods, each beginning when you take possession:

Period	What it covers
One year	Defects in work and materials, plus unauthorized substitutions
Two years	Water penetration, plus defects in work and materials in the electrical, plumbing and heating delivery and distribution systems
Seven years	Major structural defects

Statutory coverage is capped at $400,000 for a freehold home and $300,000 for a condominium unit. Those limits can differ depending on when the agreement of purchase and sale was signed.

Two practical points. The warranty follows the home rather than the owner, so it continues if the home is sold inside the period. And a warranty is a claims process rather than a promise nothing will go wrong, so keep your paperwork and log issues as you find them.

Interim occupancy, the cost nobody budgets for

This one applies to condominiums and it catches almost every first time pre-construction buyer.

Interim occupancy is the stretch where the builder lets you take occupancy of your unit before the declaration is registered and title can transfer to you. It can last months. During it you pay an occupancy fee, capped at three things added together:

• The interest, calculated monthly, on the unpaid balance of the purchase price at the prescribed rate
• The estimated monthly municipal taxes for the unit
• The projected common expenses for the unit

None of that pays down a mortgage, because you do not have one yet. It is closer to rent. And it is due whether or not you actually move in, which matters if your plan was to lease the unit out and the building is not ready.

Budget for it as a real monthly cost over an uncertain number of months, because that is what it is. Our post on condo fees in Markham covers what common expenses pay for once the building is registered.

HST, and the rebate already baked into the price

New homes attract HST. The price on the sales centre wall almost always has the new housing rebate assumed into it. If you do not qualify, the number moves, which is an unpleasant discovery to make late.

A first time buyer may also be eligible for the federal first time home buyers’ GST/HST rebate on a qualifying new home. It covers 100 percent of the GST (or the federal part of the HST) on a new home valued up to $1 million and reduces gradually between $1 million and $1.5 million. It applies only to a home bought from a builder, which is exactly the situation here. Our first time home buyer guide sets out how that interacts with the FHSA, the Home Buyers’ Plan and Ontario’s land transfer tax refund.

Have your lawyer confirm which rebates the agreement assumes and who is entitled to claim them before you sign.

The clauses worth reading twice

A builder’s agreement is long and it is written by the builder. Four things repay the effort:

1. Closing adjustments. Development charges, levies, utility connections and meter installations are commonly passed to the buyer. Ask whether they are capped and at what.
2. Delayed closing. New builds move. Understand what notice you are owed, what compensation exists and what your options are if the date slips well beyond the original.
3. Assignment. Whether you may sell your contract before closing, on what terms and at what fee. Never assume this is available.
4. Changes to the plan. What the builder may change in the unit or the building without your consent.

None of that is legal advice. It is the list to hand your lawyer. It is also the reason to use one who does new construction work regularly rather than whoever is cheapest.

Where new construction is happening in Markham

Downtown Markham carries the most concentrated condominium development in the city, with townhouse and detached construction across the newer communities to the north and east.

The part worth saying plainly: you are buying a neighbourhood that is still being built. Renderings are marketing rather than information. What exists today, the transit, the schools, the shops and the commute, is the thing to judge. Our guides to Downtown Markham, Cornell, Greensborough and Cathedraltown describe those areas as they actually are.

New or resale

There is no general answer and anyone who gives you one is selling something.

New construction gives you a warranty, current building standards and a long runway between signing and closing, which suits a buyer who is still saving. It costs you certainty: on the date, on the final adjustments and on what the finished neighbourhood will feel like.

Resale gives you a home you can walk through, a neighbourhood that already exists and a closing date you can plan around. It costs you the warranty and leaves you with whatever the previous owner did or did not maintain.

If you want an honest read on which suits your situation, including the case for waiting, that is a conversation worth having before you put down a deposit. We will tell you when we think the answer is resale.