The pre-construction market in the Greater Toronto Area has undergone a dramatic shift in 2025-2026. Developers are offering incentives, flexible deposit structures, and price reductions that were unthinkable during the 2021-2022 boom. For buyers who understand how to navigate this market, significant opportunities exist.
The Current Pre-Construction Landscape
Presale activity has slowed considerably, leading developers to:
- Offer extended deposit structures (10-15% over 2-3 years instead of 20% in 1 year)
- Provide development fee caps and closing cost credits
- Reduce prices or offer upgrade packages
- Allow assignments without fees or restrictions
- Delay project launches until sufficient buyer interest is secured
Understanding the Deposit Structure
When buying pre-construction, you don't pay the full purchase price upfront. Instead, you pay deposits over time:
- Signing: $5,000 - $10,000
- 30 days: 5% of purchase price minus initial deposit
- 90-180 days: Additional 5%
- Occupancy: Remaining balance (typically 5-10%)
The remaining 80-85% is financed through your mortgage at closing (final registration).
Key Protections for Buyers
Ontario's Tarion warranty program protects pre-construction buyers:
- Deposit protection up to $20,000 (freehold) or $20,000 (condos)
- 1-year warranty on workmanship and materials
- 2-year warranty on major systems (plumbing, electrical, HVAC)
- 7-year warranty on structural defects
Red Flags to Avoid
- Developers without a track record of completed projects
- Projects that have been delayed multiple times
- Unrealistic price appreciation assumptions in sales materials
- Hidden fees in the purchase agreement (development levies, utility hookup, etc.)
Advice for 2026 Buyers
With the market favouring buyers, this is one of the best times to negotiate a pre-construction purchase. Have a real estate lawyer review the agreement before signing, understand all potential fees, and ensure the developer is registered with Tarion.
Interested in pre-construction opportunities? Contact our team for access to platinum launches and preferred pricing.