Quick answer: To choose the best pre-construction project in Ontario, check five things in order:
- Builder: a licensed builder with a record of finishing on time. Check the Ontario Builder Directory.
- Location: close to existing or under-construction transit, jobs and schools.
- Price: a price per square foot close to nearby new resale.
- Project status: construction financing in place and a realistic timeline.
- Unit and terms: a layout that rents well, plus a reasonable deposit, capped closing costs and assignment rights.
This is Chapter 3 of our Ultimate Guide to Investing in Pre-Construction in Ontario.
Every project launch looks great in the rendering. The lobby is bright, the amenities are endless and the price list always says "starting from." The real work is checking whether the project will actually be built, whether the price makes sense, and whether you'll be able to rent or sell it when it's done. Here's the checklist we use.
1. Check the builder's track record
The builder matters more than any other factor. A strong builder finishes on time, delivers what's promised and has the financial strength to survive a slow market.
- Look the builder up on the Ontario Builder Directory, run by the Home Construction Regulatory Authority (HCRA). It shows licence status, past homes enrolled with Tarion, warranty claims and any conditions on the licence.
- Visit finished buildings by the same builder. Look at finishes, common areas and how the building has aged.
- Ask about past delays and cancellations. More than 11,000 GTHA condo units were cancelled between 2024 and mid-2026, according to Urbanation.
- Check who the partners are: developer, general contractor and lender. Established partners are a good sign.
2. Check the location fundamentals
Location drives both rent and resale. Look for:
- Transit: walking distance to subway, GO or LRT. Lines under construction, like the Ontario Line, Eglinton Crosstown and Hamilton LRT, can lift values as they open. Confirm that a line is funded and under construction, not just announced.
- Employment: hospitals, universities, downtown cores, tech and logistics hubs.
- Schools, parks and retail: these matter for long-term owners and families.
- Future supply: how many other towers are planned nearby? A neighbourhood with thousands of units completing at once can soften rents.
3. Compare the price to resale
Calculate the project's price per square foot and compare it with condos built in the last five years nearby. In Q2 2026, completed, unsold GTHA condos were asking about $1,186 per square foot on average, while resale units in recently registered buildings sold for about $830. A big premium means more risk of an appraisal gap at closing.
| Check | Healthier sign | Warning sign |
|---|---|---|
| Price vs. nearby new resale | Small premium or at par | Large premium (30%+) |
| Price trend | Launch pricing or incentives | Several price increases with little sold |
| Rent per sq ft | Local rents support carrying costs | Deep negative cash flow even at 20% down |
4. Check the project's status
A project that hasn't started construction is riskier than one that's in the ground.
- Sales: builders usually need a large share of units sold (often around 70%) before a lender provides construction financing.
- Approvals: zoning and site plan approvals in place?
- Construction: has excavation or construction started?
- Timeline: are the first tentative occupancy date and outside date realistic?
- HST rebate deadlines: for the 2026 rebate, construction must begin by December 31, 2028 and be substantially complete by December 31, 2031.
5. Choose the right unit
- Two-bedroom and one-plus-den layouts with a usable den
- Efficient floor plans with minimal hallway space
- Good light and views that won't be blocked by a future tower
- Avoid units next to garbage rooms, elevators or mechanical rooms
- Parking and a locker, if the market expects them
6. Read the terms
Two units in two buildings with the same price can have very different real costs. Compare:
- Deposit structure
- Development charge caps and closing cost schedules
- Assignment rights and fees
- Leasing during occupancy
- Estimated maintenance fees per square foot
- HST clause, especially for investors
Condo or freehold?
| Pre-construction condo | Pre-construction freehold (town, semi, detached) | |
|---|---|---|
| Entry price | Lower | Higher |
| Typical deposit | 15–20% | Often 5–10% |
| Time to completion | 3–5+ years | 1.5–3 years |
| Monthly fees | Condo fees | None, or small POTL fees |
| Deposit protection | Trust account and up to $20,000 Tarion | Tarion up to $60,000–$100,000 |
| Land value | Shared | You own the land |
In 2026, many investors are shifting toward freehold towns and semis in the 905 because they include land, have shorter timelines and better deposit protection.
Project due diligence checklist
- ☐ Builder licensed and in good standing on the Ontario Builder Directory
- ☐ Visited at least one finished building by the same builder
- ☐ Price per sq ft compared with nearby new resale
- ☐ Rent estimate and monthly carrying costs calculated
- ☐ Construction status and financing confirmed
- ☐ Deposit, caps and assignment terms reviewed
- ☐ Lawyer review booked inside the 10-day cooling-off period
Browse current projects across Ontario on the Buyprecon.ca map.
Previous: Chapter 1: Why invest · Chapter 2: Tips and tricks
Frequently asked questions
How do I check if a pre-construction builder is reliable?
Search the builder on the Ontario Builder Directory, run by the HCRA. It shows the builder's licence status, past homes and warranty history. Also visit finished projects and ask about past delays or cancellations.
What happens if a pre-construction project is cancelled?
For condos, your deposit must be returned with interest. For freehold homes, Tarion covers deposits up to set limits if the builder can't return them. You won't get back any increase in value you expected.
How do I know if a pre-construction price is fair?
Compare the price per square foot with nearby condos built in the last five years. A large premium over resale increases the risk of an appraisal gap at closing.
Is it safer to buy a project that's already under construction?
Generally, yes. Once a project has construction financing and has broken ground, the risk of cancellation drops. You may pay more, but the timeline is more certain.
Should I invest in a condo or a freehold townhome?
Condos have lower entry prices. Freehold homes include land, usually complete sooner and come with stronger Tarion deposit protection. The right choice depends on your budget and goals.
About the author: Ola Otubu is a REALTOR® with Realty ONE Group Reveal, Real Estate Brokerage, and the founder of Buyprecon.ca. He represents buyers of new construction homes and condos across Ontario, from the first deposit through PDI, closing and warranty claims.
This article is general information, not financial or legal advice. Figures are illustrative and markets change. Sources: Urbanation Q2-2026 Condominium Market Survey; Home Construction Regulatory Authority; Tarion; Canada Revenue Agency.
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