Making an offer to purchase an existing or newly constructed home
Learn the differences between making an offer on a resale home and signing a contract on a new homebuilder purchase.
Updated 
3 min. read
Making an offer on a resale home
Here’s a quick look at the steps involved in purchasing an existing home.
Who’s involved: You, your real estate agent, and possibly a lawyer or a notary.
What happens: Once you have found the right home, your real estate agent can move quickly. You’ll have to decide how much to offer and how much to attach as a deposit, after which the agent will complete a “contract to purchase.” You can choose to have a lawyer or notary review this document, but it may take more time. Remember, this is a legally binding document.
The contract to purchase sets out
- Your legal name (and the name of any other buyers) and the seller’s name
- The legal civic address of the property
- The amount you are offering to pay for the property
- The deposit amount provided with the offer
- The closing date
- Any items you wish to be included in the sale (such as light fixtures, appliances, window coverings, or any other item not legally considered to be part of the structure)
- Any conditions of the offer
- The time for which the offer is valid
Price isn’t the only factor
Things like the closing date (some sellers may need to close quickly), the amount of deposit (a larger amount signals a serious intent to buy), and the conditions can all influence whether your offer is accepted. In some circumstances, the seller may be looking for a buyer who they believe will take good care of a cherished property. Once you’re happy with the contract to purchase, you’ll sign it and your agent will deliver it to the seller for review
Subject to inspection
The home must pass a professional inspection in order for you to purchase it. The inspection is how you protect yourself from the unknown; you are encouraged to include this condition.
Signing a contract on a new homebuilder purchase
Here’s a quick look at the steps involved in purchasing a new home.
Who’s involved: You, your real estate agent, and possibly a lawyer or a notary.
What happens: The builder will supply the contract (Agreement of Purchase and Sale). You are strongly advised to have your lawyer/notary review it and explain all the terms to you. Since there is no standard form for new homes, the Agreement of Purchase and Sale can vary widely from builder to builder. As well, a new home contract is more complex than a resale offer, and includes information, conditions, and contingencies
A new home contract includes
- A detailed description of the home
- The price (including upgrades and payment schedule)
- Financing and other conditions
- Construction schedule and site visits
- Colour selections and changes to your order
- Description of which items are part of your unit (if you’re buying a condo or strata unit)
- Deviations
- Warranties
- Inspections
- Disputes
Your lawyer or notary will review the home contract, identify potential issues and suggest amendments. The home contract will probably evolve over time as schedules and other details change. Visit the Canadian Home Builder’s Association for a detailed explanation of a new home contract.
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