Published 2 November 2026 · By Jatin Dua, Broker of Record, RE/MAX Quantum Realty
Before you sign for a pre-construction townhome in the GTA in 2027, find out whether it is freehold or condominium, because the rules differ. Condo townhomes come with a 10-day cooling-off period and $20,000 of Tarion deposit cover. Freehold townhomes get up to $100,000 of deposit cover, but no cooling-off period until 1 January 2028.
This guide is for first-time buyers, growing families and downsizers who are looking at a new townhome from a builder in the GTA. You will learn the one question to ask first, how your deposit is protected, what the 2026–27 HST rebates mean for you, and how new prices compare with resale townhouses, as of November 2026.
Are pre-construction townhomes still selling in the GTA?
Yes, and they are the busiest part of the new-home market right now. BILD reported that GTA low-rise new home sales beat their 10-year average for six months in a row after the enhanced HST rebate began in April 2026. In September 2026, BILD said more than half of new home sales were semi-detached homes and townhouses, a shift from the usual pattern.
Prices have come down too. The Altus Group benchmark for new low-rise homes (detached, semi and townhouses together) was $1,246,764 in September 2026, down 13.3% in a year. Townhouses usually sit below that average.
Is it a freehold townhome or a condo townhome, and why does it matter?
This is the first question to ask, because it changes your rights, your protection and your monthly costs. A freehold townhome means you own the house and the land under it. A condo townhome is a unit in a condominium corporation, with shared common elements and monthly fees.
| Rule | Freehold townhome | Condo townhome |
|---|---|---|
| Main law | Ontario New Home Warranties Plan Act (Tarion) | Condominium Act, 1998, plus Tarion |
| 10-day cooling-off | Not until 1 January 2028 | Yes, under section 73 |
| Tarion deposit cover | Up to $60,000 (price $600,000 or less); 10% to $100,000 above that | $20,000 |
| Deposit held in trust by law | No general trust rule | Yes, under section 81 |
| Interim occupancy before title | No | Possible, with a monthly occupancy fee |
| Monthly condo fees | No | Yes |
| Register with Tarion within 45 days | Yes, for maximum deposit cover | Tarion guidance is written for freehold; ask your lawyer |
Source: Tarion pre-possession coverage page; Tarion update on cooling-off dates; Condominium Act, 1998, ss. 73, 80 and 81. As of November 2026.
If you are still deciding between the two, my side-by-side guide to freehold vs condo townhouses covers the long-term costs.
How much deposit do you need for a pre-construction townhouse?
The builder sets the deposit schedule in the agreement, usually as several payments before closing. There is no legal standard amount, so compare schedules between builders and ask whether any can be reduced or spread out.
Three rules decide how safe that money is:
- Condo townhomes: the Condominium Act requires deposits to be held in trust by the builder’s lawyer or a prescribed trustee. Tarion adds up to $20,000 of protection if a deposit is not returned.
- Freehold townhomes: there is no general trust rule, so Tarion’s deposit protection is the main safety net. Since 1 April 2026, you should register your purchase with Tarion within 45 days of signing. From 1 January 2027, late or missing registration moves you into a capped special fund.
- Above the limit: any deposit above Tarion’s cover is at risk if the builder fails.
Your deposits count toward your down payment at closing. The minimum down payment in Canada is 5% of the first $500,000 and 10% of the rest up to $1.5 million. Buyers of newly built homes can get a 30-year amortization on an insured mortgage.
How do new townhome prices compare with resale townhouses?
Resale townhouses give you a benchmark to test a builder’s price. These are city-wide medians for resale townhouses, not new ones.
| City | Freehold town median 2026 | Change vs 2025 | Condo town median 2026 | Change vs 2025 |
|---|---|---|---|---|
| Brampton | $755,000 | -7.2% | $570,000 | -10.9% |
| Mississauga | $880,000 | -7.4% | $689,300 | -8.1% |
| Milton | $810,000 | -6.6% | $620,000 | -10.8% |
| Oakville | $1,005,000 | -7.8% | $712,500 | -4.3% |
| Vaughan | $1,014,500 | -9.3% | $768,000 | -6.1% |
| Markham | $999,990 | -10.9% | $750,000 | -9.1% |
| Richmond Hill | $1,040,000 | -9.4% | $690,000 | -15.6% |
| Pickering | $789,000 | -7.2% | $608,000 | -6.5% |
| Whitby | $765,000 | -4.4% | $617,500 | -9.3% |
| Oshawa | $657,500 | -10.5% | $518,500 | -9.0% |
Source: TRREB MLS data via REALM, January–October 2026 vs the same period of 2025. “Freehold town” is attached/row townhouses; “condo town” is condominium townhouses. City-wide medians.
In October 2026 alone, resale attached and row townhouses across the TRREB area sold at a median of $830,000, at 99% of the asking price, while condo townhouses sold at a median of $648,000, according to TRREB’s Market Watch. More data by city is in my GTA townhouse prices report.
When you compare, add the closing adjustments and any HST the builder has not included, and subtract the rebates you qualify for. A new townhome should earn its premium with a warranty, newer systems and better energy performance, not just a newer look.
Instant Home Valuation
What’s your home
worth today?
Answer six quick questions and get an instant value range built from current Toronto & GTA sale data — property type, size, condition, lot and location all weighted the way a real pricing conversation weighs them. Takes about ninety seconds.
Reading recent GTA sale data…
Building your estimate
Estimated market value
—
$0–$0
Most likely value $0 · roughly $0 per square foot
What moved the number
Starting from the area baseline for your property type, here’s what each answer added or subtracted.
Market context
Recent local averages for comparison.
—
A range is a starting point.
A strategy is what sells.
This model doesn’t know that your neighbour’s identical semi went $80,000 over asking last month, or which two upgrades actually pay back in your area. That conversation is free and takes twenty minutes.
Do the HST rebates apply to new townhomes in 2027?
Yes, for both freehold and condo townhomes, if you meet CRA’s conditions. Under CRA’s Notice 346, the enhanced Ontario rebate applies to agreements signed with a builder from 1 April 2026 to 31 March 2027:
- The full 8% Ontario part of HST is rebated on homes up to $1 million (to $80,000), a flat $80,000 up to $1.5 million, and a partial amount up to $1.85 million.
- Ontario’s New Home Affordability Payment can cover up to $50,000 of the 5% federal part, so total relief can reach $130,000.
- The home must be your primary residence (or a relation’s), construction must start by 31 December 2028, and it must be substantially complete by 31 December 2031.
For a $900,000 townhome, that could mean up to $72,000 off the Ontario part and up to $45,000 toward the federal part, by my math. Your lawyer confirms eligibility, and the builder often credits the rebates in the price.
What should you ask the builder before you sign?
- Is the builder licensed? Check the HCRA Ontario Builder Directory, which shows licensed builders, how many homes they have built, years in operation and any charges or convictions.
- What are the critical dates? Read the Statement of Critical Dates: first tentative date, firm date and outside date.
- What is in Schedule B? HCRA says every extra charge the builder expects to add must be listed there, and caps on adjustments can be negotiated.
- What are the early termination conditions? They must come from Schedule A, each with a deadline.
- For condo towns, what are the fees? Under the Condominium Act, the disclosure statement must include a budget statement for the first year after registration.
- Can I assign? Read the assignment clause and fee now, in case your plans change.
- What is standard, and what is an upgrade? Get the finish list attached to the agreement.
When does the cooling-off period apply to a new townhome?
For a condo townhome, section 73 of the Condominium Act lets you cancel by written notice that the builder must receive within 10 days of the latest of: getting the disclosure statement, getting Ontario’s condominium buyers’ guide, and getting a copy of the signed agreement. I explain how to use it in my post on pre-construction rescission rights.
For a freehold townhome, Tarion says Ontario moved the start of the new 10-day cooling-off period to 1 January 2028. A freehold agreement signed in 2027 does not have it. If the builder includes early termination conditions, Tarion says you get 3 business days to review them, or 10 days if there are project viability conditions.
Condo townhomes can have interim occupancy: you move in and pay a monthly fee before the condo is registered and you get title. Under the Condominium Act, that fee can include interest on your unpaid balance at a prescribed rate, an estimate of property tax and the projected common expenses. None of it builds equity. Ask how long occupancy is expected to last, and read my guide to interim occupancy in Ontario.
What happens if the builder delays or cancels the project?
For freehold homes, Tarion says a builder that misses a firm closing date must pay delayed closing compensation of up to $7,500, including $150 a day for living expenses. Tentative dates can be pushed twice by up to 120 days without compensation if proper notice is given. If the home is not done by the outside date, you have 30 days to end the agreement.
A builder can only cancel for the early termination conditions listed in the agreement. HCRA says it expects deposits, with any interest owed, to be returned promptly, and that signing a release cannot be a condition of getting your deposit back.
Townhomes are where the rebates help most right now, because so many sit under $1 million. If you can sign by 31 March 2027 and you will live in the home, run the numbers against resale on the same street. I lean toward freehold for buyers who can handle the higher deposit, because the deposit cover is larger and there are no condo fees. Condo townhomes suit buyers who want a lower entry price and the 10-day cooling-off right, as long as they budget for fees and possible occupancy.
What to do next
- Ask the sales office in writing: freehold or condo, and the full deposit schedule.
- Check the builder on HCRA’s Ontario Builder Directory.
- Compare the net price with the resale townhouse median for that city.
- Have a real estate lawyer review the agreement and schedules before you sign, or within the 10 days for a condo.
- Register with Tarion within 45 days and diarize every critical date.
Need help with this? Talk to me.
I’m Jatin Dua, Broker of Record at RE/MAX Quantum Realty, and I’m the best agent to do this kind of work for you in Toronto and across the GTA. Over $100 million in GTA sales and 100+ families helped sell. Feel free to contact me any time: call or text 833-330-1925 or email [email protected].
Frequently asked questions
How much is a new townhouse in the GTA in 2027?
Prices vary by city. The Altus Group benchmark for all new low-rise homes in the GTA was $1,246,764 in September 2026, and townhouses usually sit below that. Resale freehold townhouses sold for medians from $657,500 in Oshawa to over $1 million in Vaughan, Richmond Hill and Oakville from January to October 2026.
What deposit do I need for a pre-construction townhouse in Ontario?
The builder sets the deposit schedule in the purchase agreement, often as several payments before closing, and there is no legal standard amount. Tarion protects up to $20,000 on a condo townhome and up to $100,000 on a freehold townhome over $600,000. Deposits count toward your down payment at closing.
Is there a cooling-off period for pre-construction townhomes in Ontario?
It depends on the type. Condo townhomes have a 10-day cooling-off period under section 73 of the Condominium Act. Freehold townhomes do not: Tarion says Ontario moved the new freehold cooling-off period to 1 January 2028, so agreements signed in 2027 do not include it.
Do condo townhomes have interim occupancy?
They can. The Condominium Act lets a builder require interim occupancy before the condo is registered. You pay a monthly fee that can include interest on the unpaid balance, estimated property tax and projected common expenses, but you do not own the unit yet. Freehold townhomes close directly without an occupancy period.
Can I get the HST rebate on a new townhouse in Ontario?
Yes, if you sign with a builder between 1 April 2026 and 31 March 2027, it will be your primary residence, and it meets CRA’s construction deadlines. The enhanced rebate covers the 8% Ontario part up to $80,000, and Ontario’s payment can add up to $50,000, for up to $130,000 in total relief.
What is the difference between a freehold and condo townhouse?
With a freehold townhouse you own the house and its land outright and pay no condo fees. With a condo townhouse you own a unit in a condominium corporation and pay monthly fees for shared elements. In Ontario they also have different cooling-off rights and Tarion deposit limits on new builds.
How do I check if a GTA home builder is licensed?
Use the Home Construction Regulatory Authority’s Ontario Builder Directory. HCRA says it lists licensed builders and sellers in Ontario with details such as how many homes they have built, years in operation and any court charges or convictions. Search the exact company named on your purchase agreement before you sign in 2027.
Are pre-construction townhouse prices dropping in the GTA?
They have fallen over the past year. The Altus benchmark for new low-rise homes fell 13.3% to September 2026, and resale townhouse medians dropped in every major GTA city, for example 10.9% for freehold towns in Markham. Forecasts for 2027 vary, and no one can promise prices will not fall further.
Sources
- BILD: New high-rise sales hit record low for September, while low-rise new home sales outperform (22 Oct 2026)
- Condominium Act, 1998 (Ontario e-Laws)
- HCRA: Before you buy a new home (Ontario Builder Directory)
- Tarion: Coverage and claims before you move in
- Tarion: Freehold contract coverage, closing dates and delays
- Tarion: Update on information sheets, addenda and cooling-off period
- CRA Notice 346: Ontario enhanced new housing rebate
- HCRA Advisory: Price escalations and contract terminations
Related reading
- Biggest Condo Developers in Toronto: Track Records Buyers Should Check
- Is It a Good Idea to Buy a Condo in Toronto in 2027?
- Buying a House in Ontario on a Work Permit (2027): What the Foreign Buyer Ban Allows
- Can You Buy a House With No Down Payment in Ontario?
About the author — Jatin Dua, Toronto and GTA real estate broker
I am Jatin Dua, Broker of Record and co-founder of RE/MAX Quantum Realty Inc., Brokerage, Unit 101, 799 The Queensway, Toronto. I work with buyers and sellers across Toronto and the GTA and have helped more than 100 families sell. Four-plus years of active GTA transactions and over $100 million in sales volume.
Reach me at [email protected] or 833-330-1925, or book a call.
More from the library
- First-Time Home Buyer Guide for Etobicoke: Every Program Stacked in One Place
- What Happens When a Luxury Home Is Priced Too High in Toronto
- Bronte Harbour, Oakville: Living on the Lake West of Toronto
- Top 10 things no one will tell you about Clarkson and Lorne Park — except your local real estate expert
- Top 5 Condo Buildings to Rent in Yonge and Finch, North York, Toronto (2026)
- The Pinnacle on Adelaide, 295 Adelaide St W: Pool Tower, 1850s House
How this estimate is produced
The estimate blends recent selling prices for comparable units in the area with the details you entered: size, bedrooms, floor, exposure, parking, locker and condition. It is a statistical estimate, not an appraisal and not a formal opinion of value.
What it cannot see
- Interior condition and upgrades beyond what you told it
- Unit-specific issues: noise, an obstructed view, a pending special assessment
- Your reserve fund and where the maintenance fee is heading
- What is competing with you in your own building right now
What moves the number most
- Floor and exposure, which can separate otherwise identical units
- Parking and locker, each priced separately by buyers
- Kitchen and bathroom condition
- Maintenance fee per square foot against the rest of the building
Treat it as a range, not a price
A single figure to the dollar would be false precision. Use the estimate to decide whether a move is worth exploring. Before you price anything for the market, the number needs checking against what is actually selling and sitting in your building this month, and that takes a person. I will do that for you at no cost and with no obligation.
Market data is sourced from the Toronto Regional Real Estate Board. Information is deemed reliable but is not guaranteed. This tool does not provide an appraisal or a formal opinion of value, and it is not a substitute for advice on your specific property. Jatin Dua, Broker of Record, RE/MAX Quantum Realty.
