The ten-day cooling period, and what protects your deposit

Second-guessing a pre-construction purchase is normal, and Ontario gives you a window in which second-guessing costs nothing. What it does not give you is the unconditional deposit guarantee the industry sometimes implies. Both are worth understanding precisely.

The ten-day cooling period

Under the Condominium Act, a buyer of a pre-construction condominium unit has ten days from receipt of the executed agreement and the disclosure statement to rescind, without penalty and without giving a reason. The deposit comes back. Ten calendar days, not business days — a long weekend does not extend it.

The point of the window is not to let you change your mind on feel. It is to give you time to have the agreement read. Something made the unit worth signing for; the question inside the ten days is whether the contract around it is acceptable.

Use the window on the agreement

A real estate lawyer will look for the terms that decide what the purchase actually costs and what you can do with it: whether development charges and levies are capped, whether you may assign the unit and on what consent terms, whether you may lease during interim occupancy, and what the builder's rights are to move the dates. Amendments are negotiable inside the ten days. Outside them, you are asking rather than requiring.

Legal fees for this are small against the exposure — an uncapped development charge is an open-ended number payable on closing. We are not going to quote you another firm's rates; ask for a fixed fee for the review and any amendment before you instruct.

Once the ten days pass the agreement is firm. Some builders' agreements contain a later termination right for a fee. Many do not, and none of them should be part of your plan.

Deposit protection is not unlimited

Condominium units

Two mechanisms sit behind a condominium deposit, and they are often conflated. First, the Condominium Act requires the builder to hold deposit money in trust, with prescribed security where it is released. Second, Tarion's deposit coverage protects condominium deposits up to$20,000 where the money was not held in trust.

So the deposit is protected — but by trust provisions and prescribed security, with a $20,000 warranty backstop, not by a blanket guarantee that every dollar returns in every scenario. It is worth confirming with your lawyer how your deposits are being held and secured, particularly on later instalments.

Freehold homes

Different, and lower. Tarion protects deposits on a new freehold home up to$60,000 where the purchase price is $600,000 or less. Above that, coverage is 10 per cent of the purchase price to a maximum of$100,000.

On an $850,000 freehold home that is $85,000 of coverage. Buyers who have put down more than the covered amount are carrying the difference themselves, and this is the gap most freehold pre-construction buyers do not know they have.

Deposit coverage amounts are Tarion's as at July 2026 and are set by regulation — confirm current limits at tarion.com before relying on them. Nothing here is legal advice.

What this adds up to

A pre-construction condominium purchase gives you ten days to get out for nothing, and a deposit that is secured rather than guaranteed. Both are real protections. Neither removes the need to have the agreement read by someone acting for you.

The full process is set out in our nine-step guide, and we are glad to look at an agreement you are already holding — send us the project name and your firm date.