STEP-BY-STEP GUIDE TO BUYING A NEW CONSTRUCTION HOME

Buying a new construction home can be exciting you get a brand-new space, modern features, and often the ability to customize finishes. But the process is very different from buying a resale home. Understanding each step ahead of time can help you avoid costly mistakes and delays.

Here’s a step-by-step guide to buying a new construction home, from planning to possession.

Step 1: Decide If New Construction Is Right for You

Before you start touring show homes, consider whether new construction fits your lifestyle and timeline.

New construction may be right for you if:

• You want a brand-new home with minimal maintenance

• You like modern layouts and energy-efficient features

• You’re comfortable waiting months (or longer) for completion

It may not be ideal if:

• You need to move quickly

• You want a mature neighborhood

• You have a tight budget with little flexibility for upgrades

Step 2: Get Pre-Approved for a Mortgage

Mortgage rules for new construction can be different from resale homes.

A pre-approval helps you:

• Understand your true budget

• Show builders you’re a serious buyer

• Prepare for deposit and draw requirements

Some builders also have preferred lenders, but you are not required to use them.

Step 3: Choose the Right Builder and Development

Not all builders are the same. Research is critical.

What to look for:

• Builder reputation and reviews

• Years in business

• Completed projects you can visit

• Warranty coverage

• Clear contracts and timelines

If you’re buying in a new development, also review:

• Future phases

• Amenities

• Strata or HOA rules (if applicable)

Step 4: Understand Pricing, Deposits, and Incentives

New construction pricing often looks simple but there’s more beneath the surface.

Key things to review:

• Base price vs. total price after upgrades

• Deposit structure and payment schedule

• Incentives (upgrades, credits, closing cost assistance)

• GST or tax implications (Canada)

Always ask for a full cost breakdown before signing anything.

Step 5: Review the Contract Carefully

Builder contracts strongly favor the builder, not the buyer.

Before signing:

• Review completion dates and delay clauses

• Understand cancellation rights

• Confirm what happens if the market changes

• Clarify upgrade deadlines and penalties

It’s highly recommended to have a real estate lawyer review the contract.

Step 6: Select Your Floor Plan and Upgrades

This is the fun part but it’s also where budgets can quickly grow.

Tips for upgrades:

• Focus on structural upgrades first (layout, electrical, ceiling height)

• Be cautious with cosmetic upgrades you can do later

• Stick to a firm budget before entering the design center

Remember: upgrades are usually non-negotiable once selected.

Step 7: Monitor Construction Progress

Depending on the type of new construction, you may:

• Receive progress updates

• Attend milestone walkthroughs

• Wait months with limited visibility

Stay in communication with the builder, but expect timelines to shift delays are common.

Step 8: Conduct a Pre-Possession Walkthrough

Before you get the keys, you’ll do a walkthrough to identify deficiencies.

Look for:

• Damage, scratches, or missing items

• Appliance installation

• Plumbing, electrical, and HVAC functionality

• Agreed-upon upgrades

Document everything in writing.

Step 9: Get a Home Inspection (Yes, Even for New Homes)

Many buyers skip this step but new homes can still have issues.

A professional inspection can catch:

• Construction defects

• Safety concerns

• Code issues

It’s easier to fix problems before possession than after.

Step 10: Close and Take Possession

On completion day:

• Final mortgage funds are released

• Legal documents are signed

• You receive the keys

After moving in, track any warranty issues and submit claims promptly.

Buying a new construction home is a unique process with its own risks and rewards. With the right preparation, professional advice, and realistic expectations, it can be a smooth and rewarding experience.

If you’re considering new construction, working with professionals who understand builder contracts and timelines can make a significant difference.