Buying a home before it is built sounds exciting. But the first question is always the same: how much cash do you need up front?
The short answer is 15% to 20% of the price. Here is how that money works, when you pay it, and what you should budget for each type of home you can buy.
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What Is the Typical Down Payment in Ontario?
Most builders ask for a total deposit of 15% to 20% of the purchase price. That is higher than the 5% many buyers put down on resale homes.
The good news is you do not pay it all at once. Builders split the deposit into smaller payments over two to four years. Some projects ask for 10%. Others ask for 25%.
Terms differ by builder, so read the agreement of purchase and sale with care. This rule holds true for pre-construction homes Ontario buyers choose across the GTA, Hamilton, Ottawa, and beyond.
How the Deposit Schedule Works
The deposit is like a payment arrangement. You don’t give 20% straight away at the very beginning. Rather, you make a modest payment upon signing and add more in the following years. This is how builders operate because they want customers to be able to save up during construction.
Here is one common way a 20% deposit gets split:
- At signing: $5,000 to $10,000
- 30 days later: Top up to 5%
- 90 days: Another 5%
- 180 days: Another 5%
- Occupancy or later: The final 5%
Ontario gives condo buyers a 10-day cooling-off period after signing. Builders must hold your deposit in trust, so the money stays protected. Ask your lawyer to explain the limits of Tarion deposit coverage.
When the home is ready, you pay the rest at closing. That balance usually comes from a mortgage. Your lender checks your income and credit again at that time, so keep your finances steady while you wait.
Estimated Condo Prices and Deposits
Please note: These are not actual prices. They are rough estimates to help you plan. Real prices change by city, project, and floor plan.
New condos in the GTA often fall between $500,000 and $900,000. Smaller cities may cost less.
At 20%, your deposit would run about $100,000 to $180,000. At 15%, it would be about $75,000 to $135,000.
Condos usually need the smallest deposit in dollars. That is why many first-time buyers start here. If you plan to browse pre-construction condos for sale Ontario wide, compare deposit plans first, since two projects at the same price can ask for very different cash.
Estimated Townhome Prices and Deposits
Again, these figures are estimates, not actual pricing. New townhomes in growing GTA suburbs often range from $800,000 to $1.2 million. Some towns outside the GTA cost less.
A 20% deposit would be about $160,000 to $240,000. Townhomes give you more space and often a small yard. They also tend to cost more up front.
Estimated Detached Home Prices and Deposits
New detached homes often range from $1.1 million to $2 million or more. Large lots and prime areas cost even more.
Your 20% deposit could land between $220,000 and $400,000. Some builders of detached homes ask for less, such as 10% to 15%, but plans vary. Ask each builder for its full deposit schedule in writing.
Closing Costs and Smart Ways to Prepare
The deposit is not your only cost. Plan for these extra items too:
- Land transfer tax (Toronto buyers pay a second city tax)
- HST, which may be included in the price or rebated in some cases
- Development charges and utility hookup fees
- Legal fees
- Interim occupancy fees on condos, paid before final closing
Closing costs can reach 3% to 6% of the price. Check your agreement to see what the builder covers.
Here are a few steps that help:
- Get a mortgage pre-approval before you sign.
- Save a little each month, since deposits are due on set dates.
- Hire a real estate lawyer to review the contract.
- Keep an emergency fund apart from your deposit money.
Many people ask where to begin when they search for pre-construction homes Ontario has to offer. Start with your budget, then match it to the home type that fits.
Ready to explore new projects with clear deposit details? Visit Condos2Home to find options that match your budget.
