Buying a New Build in London ON: Real Estate Lawyer Considerations

New construction has a special pull. Fresh paint, modern layouts, efficient systems, and the chance to choose finishes that match your taste. In London, Ontario, with steady population growth and a healthy mix of infill and subdivision projects, buying a pre-construction or recently completed home can make a lot of sense. Prices can be locked in ahead of completion, and warranties offer peace of mind that older homes cannot match. The legal side, however, feels nothing like a typical resale transaction. Builder agreements in Ontario are dense, highly negotiated in the industry’s favour, and full of moving pieces: adjustments, occupancy phases, critical dates, warranty obligations, and closing logistics that differ from what most buyers expect. A good real estate lawyer protects your deposit, manages deadlines, and negotiates changes so small decisions today do not become expensive surprises on closing day.

This guide walks through how these transactions work in the London market, what a lawyer actually does in this context, and where buyers tend to get caught. It reflects the day-to-day experience of London ON lawyers who regularly handle new builds, including the team at Refcio & Associates, a London ON Law firm that provides legal services across real estate, estates, family, bankruptcy, and business law. The emphasis is practical: what to look for in the agreement, what to budget for, and when to push back.

The builder agreement is not a standard form, even when it looks like one

Most builders use the Ontario Real Estate Association for the offer on resales, but for new builds they rely on their own templates, often dozens of pages long with schedules for finishes, construction standards, and deposit timing. Many refer to Ontario’s Tarion regime, but the contractual language around adjustments and delays is builder-drafted.

I often see buyers skim the “extras” page and overlook adjustment clauses that let the builder add thousands of dollars at final closing. Common line items include hydro and gas connection fees, grading deposits, water meter installations, boulevard tree planting, third-party inspection fees, and HST allocation issues. The agreement might cap adjustments, or it might not. Two London-area agreements signed the same month can have wildly different caps. A sophisticated real estate lawyer will flag those clauses and either negotiate a maximum cap or ensure the numbers are clear enough to budget accurately. If the builder refuses a cap, your lawyer can at least label the risk and estimate a range. I’ve seen “surprise” adjustments land between 2,000 and 12,000 dollars, occasionally higher in larger projects with extensive municipal servicing.

Understanding deposit structure and deposit insurance

Deposits on new builds often roll in stages: an initial amount on signing, then top-ups at 10, 30, and 60 days, sometimes tied to construction milestones. In Ontario, deposits paid for new freehold homes are generally protected up to certain limits under the Ontario New Home Warranties Plan Act, administered by Tarion. Condominium deposits have additional trust protections under the Condominium Act. The key question is how and where the deposit is held: in trust with the builder’s lawyer, with the builder directly, or a statutory trust under the condo regime. Your lawyer should confirm the trust account details and Tarion registration, and get clarity on refund rights if the deal collapses due to critical dates or unfulfilled conditions.

In practice, builders comply with registration, but mix-ups happen, especially with smaller operators or quickly scaled projects. Ask your lawyer to confirm the builder’s Tarion enrollment and check if the builder is in good standing. A London ON real estate lawyer familiar with local developers will know which builders have a clean track record and which ones demand extra caution.

HST on new homes and the rebate trap

HST applies to most new homes in Ontario, but the federal and provincial new housing rebates soften the blow. Builders usually price their homes “HST included with rebate assigned to the builder.” That phrase matters. It means the pricing assumes you, the buyer, will qualify for the GST/HST New Housing Rebate and assign it to the builder, reducing the price by the rebate amount. If you will not occupy the property as your primary residence, or if you plan to rent it long term, you may not qualify for the end-user rebate. In that case, the builder typically charges the full price without the rebate on closing, then you pursue the New Residential Rental Property Rebate separately. This mismatch can add more than 20,000 dollars to your closing funds.

Your lawyer should determine your intended use early, confirm whether the agreement requires assignment of the rebate, and configure the paperwork so you either qualify for the end-user rebate or are prepared to claim the rental rebate after closing. Timing matters. If your lender calculates the mortgage advance expecting one scenario, and the builder’s statement of adjustments reflects another, the shortfall can be painful.

Interim occupancy for condominiums: paying before you own

For condos, “closing” usually happens in two steps. First is interim occupancy, when you get the keys and can move in, but title has not yet transferred because the building is not registered as a condominium corporation. During this period you pay an occupancy fee to the builder, which is essentially an estimate of interest on the unpaid balance, plus a share of common expenses and property taxes. This fee is not paying down your principal. Many buyers assume their mortgage starts at occupancy, then find out the lender will not advance funds until final closing when the condo registers.

A good lawyer sets expectations and helps you budget for an occupancy period ranging from a few weeks to many months, depending on construction and municipal approvals. In London, most larger condo projects have managed occupancy windows within three to nine months, but timelines can slip. You want your lawyer to review the statement of occupancy fees, push back on improper charges, and confirm that the builder cannot collect rent-like amounts beyond what the Condominium Act allows.

Critical dates, delays, and your rights under Tarion

Tarion’s Addendum to the agreement sets out the builder’s construction schedule, key dates, and the permitted reasons for delay. There are formulaic categories, and they matter. If the builder misses certain dates without a permitted reason, buyers can sometimes terminate and recover deposits, or seek delayed closing compensation within Tarion’s limits. The rules are technical. Your lawyer should review the Addendum to identify outside dates and clarify what happens if the site encounters weather delays, labour disruptions, or supply chain issues.

Here is where judgment counts. I have seen buyers terminate at the first missed date, then scramble to find an alternative home in a hotter market. Sometimes patience is better, especially if the builder is near completion and you like the product. Other times, repeated delays with weak explanations justify a tougher stance. A local real estate lawyer can compare what you are being told to what is typical for London builders on similar sites.

Freehold versus condominium: different risks, different paperwork

Freehold new builds usually involve a single closing, title transfers at that point, and adjustments include municipal charges and utility connections. Condominiums add occupancy, a registered declaration and description, and the initial budget for common expenses. The builder delivers a disclosure statement for condos. Your lawyer reviews it to see if there are unusual cost-sharing agreements, service contracts, or shared facilities that could increase fees later. I pay close attention to bulk internet or energy contracts, reciprocal cost-sharing with neighbouring phases, and early-year budget shortfalls that lead to fee jumps.

Townhomes can be either freehold or condominium. Freehold townhomes sometimes come with condominium-style shared elements under a Common Elements Condominium Corporation for private roads or amenities. The nuance often gets buried in the marketing brochure. Ask your lawyer specifically: is this a freehold with private road fees, or a standard freehold with commercial real estate law London municipal roads and no shared budget?

Title work and municipal compliance in London

New subdivisions move through staged municipal approvals, with grading plans, stormwater management, servicing, and parkland contributions. Builders often register title before all minor works are finished. Buyers then inherit obligations to maintain grading until the city grants final approvals. Your lawyer will check the subdivision agreement, easements, and the status of municipal holdbacks. It is common to see title subject to easements in favour of the city or utility providers for storm sewers, watermains, or shared drainage. These are routine, but you want to know if the easement crosses your planned patio or future shed.

I recommend a survey substitute like a builder’s lot grading plan and an up-to-date plan of subdivision, but if you plan fencing, a deck, or a pool, consider a lot staking after closing to avoid boundary surprises. Infill projects within older London neighbourhoods sometimes carry site-specific conditions on heritage elements or tree preservation. A local real estate lawyer usually knows which streets have quirks and can coordinate with your contractor to avoid city by-law issues.

Adjustments and closing costs: set a realistic reserve

Budgeting for closing costs on a new build feels trickier than on a resale. The standard items are there: land transfer tax, title insurance, legal fees, lender fees, and disbursements. On top of that, builder adjustments add variability. If your agreement has a cap, great, but check how the cap is defined. Some caps exclude HST issues or development charges. Others include them. Development charges vary by project and date of agreement; sometimes the builder agrees to absorb them, other times they pass them to the buyer in whole or part. A careful reading avoids the Saturday morning phone call where the builder’s lawyer asks for thousands more than you wired.

For a typical single-family new build in London, a conservative reserve for adjustments might be in the 3,000 to 8,000 dollar range when caps are in place and the agreement is standard. Without caps, I prefer clients to reserve more. Condos introduce occupancy fees before final closing, but final adjustments can be more predictable because the Condominium Act constrains some charges.

Upgrades, extras, and the change order paper trail

Design centre appointments are fun until the checkout total arrives. I advise clients to treat upgrades like you would a renovation contract: insist on a written change order that lists the item, the price including HST, and when payment is due. Some builders demand full payment for upgrades in advance; others add it to closing. If the builder takes early payment, your lawyer should confirm how those funds are held and whether they are part of the protected deposit regime or a separate payment. It is reasonable to ask the builder’s lawyer to acknowledge receipt and treatment of those amounts.

One practical note: where structural changes require building permit amendments, timelines can shift. If you are moving walls or adding windows, understand that a seemingly minor tweak may push delivery into a new weather season. Your lawyer will not manage construction, but can make sure the agreement’s delay language still protects you.

Lender coordination: instructions, appraisals, and occupancy financing

Not all lenders treat pre-construction the same way. Some issue long-dated approvals or rate holds, others will only commit within 90 to 120 days of the final closing date. For condos with occupancy, few lenders advance funds at occupancy. The bank may still want an appraisal before final closing, and appraisers need access to the finished unit at the right stage. Your lawyer’s office works with the builder’s lawyer to confirm access, arrange final adjustments, and calculate the exact funds needed from the lender and the buyer. If you plan to use gifted funds, RRSP withdrawals, or proceeds from a sale, give your lawyer timelines and documentation early; lenders hold back if the paper trail is incomplete.

Bridge financing is less common with brand-new homes, but if you are selling a current property and your purchase closes before your sale, you may need it. There are timing traps here. If final closing on the condo slips, your bridge period might stretch. Factor that into your cost estimates.

The role of title insurance and new construction risks

Title insurance covers many defects that a traditional survey or off-title search might miss. In new construction, it helps with issues like unregistered easements, work orders, or unauthorized encroachments that surface after closing. It does not replace municipal inspections or Tarion coverage, and it will not pay for punch-list items like scuffed floors. It is also not a panacea for knowingly accepted risks. If your agreement discloses a shared access easement over the side yard, the policy will not erase it. Your lawyer chooses a policy that fits the property type, adds endorsements where needed, and explains what falls outside the policy so you are not relying on false comfort.

Walk-throughs, deficiencies, and holdbacks

Most builder agreements allow a pre-delivery inspection, often the day before occupancy for condos or shortly before closing for freeholds. Tarion has a formal Pre-Delivery Inspection process for covered homes that creates a deficiency list. Cosmetic issues happen on any site, and most get handled within the first 30 to 120 days. You want the deficiency list to be precise: instead of “paint issues,” write “paint drip on bedroom 2 north wall beside closet.” Builders respond faster when the list is specific.

Occasionally clients ask for a financial holdback at closing to cover deficiencies. In Ontario, most builder agreements do not allow that unless specifically negotiated, and larger builders rarely agree. The better strategy is documenting issues clearly and leveraging Tarion’s timelines and escalation steps. Your lawyer will ensure your notices go to the right address in the right format, which sounds bureaucratic, but missed steps can reset the clock.

Assignments: flipping the contract before closing

In a rising market, some buyers consider assigning their purchase agreement to a third party before closing. Assignment rights in new build contracts are heavily controlled. The agreement may prohibit assignments outright, allow them with the builder’s consent and a fee, or restrict advertising. If you intend to keep assignment flexibility, negotiate it at the outset. Taxes on assignment profits can be complex, and HST can apply to the assignment amount in many scenarios. Your real estate lawyer will coordinate with a tax professional, especially if you are not occupying the property. The deal structure matters. An assignment of agreement is not the same as a resale after closing, and lenders treat them differently.

When warranties do and do not help

Tarion provides coverage for defects in work and materials, with different windows for different issues. One-year coverage typically addresses general defects, two-year coverage covers major systems like plumbing, electrical, and envelope water penetration, and seven-year coverage covers major structural defects. Tarion does not cover normal wear, minor shrinkage cracks, or issues outside the builder’s control. Landscaping often sits in a grey zone if the municipality has not released final approvals and your lawn sinks along the service trench after a heavy rain. Keep all builder communications and photographs dated. If you need to escalate, a detailed timeline helps.

The legal team you need, and when to involve them

Engage a real estate lawyer before you sign or during the cooling-off period if the property is a condo. With new freehold homes, there may be no statutory rescission period, so advance review is best. In many London projects, the builder provides a few days for lawyer review even on freeholds, but that is not guaranteed. If your plans include incorporating a small business, buying in a corporation or trust, or blending family funds, a business lawyer or family lawyer may need to weigh in. Estate planning also intersects with real estate: title strategy for spouses, survivorship designations, and whether to add adult children to title are decisions with tax and probate implications. A well-rounded London ON Law firm that offers real estate lawyer, estate lawyer, family lawyer, bankruptcy lawyer, and business lawyer services can spot cross-issue pitfalls. Refcio & Associates is one example of London ON lawyers who coordinate these touchpoints so your choices on the purchase do not create headaches in your will or tax filings later.

Common traps I still see in London new builds

The patterns repeat often enough that they are worth calling out, and preventing them usually costs less than cleaning them up later.

Assuming the price is “all in” without reading the adjustments and HST allocation language. Expecting the mortgage to fund at occupancy for a condo. Over-customizing late in the build, which triggers permit delays and pushes closing into an awkward financing window. Forgetting to align the lender’s conditions with the builder’s firm closing date. Not reserving enough cash for last-mile items like window coverings, appliances where excluded, and landscaping that the builder only roughs in.

A buyer’s short legal checklist for London new builds

Get the agreement to your real estate lawyer before your deposit goes firm, and ask about caps on adjustments, assignment rights, and HST treatment. Confirm Tarion registration, the builder’s status, and your eligibility for the HST new housing or rental rebate. Map your financing to the actual timeline: interim occupancy versus final closing, appraisal access, and rate hold expiry. Ask your lawyer to explain the subdivision agreement, easements, and municipal conditions that could affect your use of the property. Document pre-delivery deficiencies carefully and follow Tarion’s notice procedures to the letter.

What strong representation looks like on closing day

On the day funds move, the unglamorous work matters. Your lawyer’s office has already reviewed the statement of adjustments, verified the trust ledger, reconciled lender instructions, confirmed title insurance, and checked that the transfer, deed, and mortgage are correct. Wire cutoffs are not forgiving; sending funds early avoids a late key release. Good files feel boring at this stage, and that is exactly the point. The buyer gets keys, the builder gets paid, and there are no frantic calls about an unexpected 9,000 dollar development charge.

After closing, a thorough file includes e-registered deeds, mortgage documents, title insurance policy, Tarion enrollment confirmation, and a summary of deadlines for 30-day and year-end warranty submissions. Keep that package; it saves time when you refinance, sell, or make a warranty claim.

Final thoughts from the trenches

Buying a new build in London offers value that older housing stock cannot always match. Energy performance is better, layouts suit current lifestyles, and maintenance costs should be lower in the early years. The trade-off is contractual complexity. Builder agreements are unapologetically detailed and often one-sided. That does not mean you lack leverage. It means your leverage shows up through careful Law firm review, targeted negotiation where the builder will move, accurate budgeting, and disciplined execution on conditions and dates.

Choose a real estate lawyer who does this work routinely, not occasionally. Ask how they handle HST allocations, what typical adjustment caps look like for the builder you are considering, how long occupancy has run in similar condo projects, and what municipal strings attach to your subdivision. If your life includes business ownership, blended families, or estate planning priorities, make sure the firm can connect those dots. Legal services are not just about getting you across the finish line; they are about structuring the path so the finish line is where you intended.

London’s market continues to add new neighbourhoods and infill opportunities from Fox Field to Southwest and along transit corridors. The details vary by site and builder, but the core legal considerations repeat. Know your agreement, guard your deposit, plan your financing to match the builder’s process, and put a steady hand in your corner. Firms like Refcio & Associates, providing legal services London buyers rely on, bring that steady hand to the table. With the right preparation, your first walk through a finished, empty house with your name on title feels exactly as it should: exciting, not stressful.

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Refcio & Associates is a full-service law firm based in London, Ontario, supporting clients across Ontario with a wide range of legal services.
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People Also Ask about Refcio & Associates

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Refcio & Associates is a law firm that works across multiple practice areas. Based on their public materials, their work often includes real estate matters, corporate and business law, employment law, estate planning, family-related legal services, and litigation support. For the best fit, it’s smart to share your situation and confirm the right practice group for your file.

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They commonly assist with real estate legal services, which may include purchases, sales, refinances, and related paperwork. The exact scope and timelines depend on your transaction details and deadlines.

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They list employment legal services among their practice areas. If you have an urgent deadline (for example, a termination or severance timeline), contact the firm as soon as possible so they can advise on next steps and timing.

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