How to Protect Yourself When Buying a Newly Built Home

How to Protect Yourself When Buying a Newly Built Home

Some people prefer to buy a pre-construction residence (that is yet to be built) to create a customized home or to enjoy simply living in a space not previously inhabited.

Are there pitfalls to avoid? Of course! Here are some points you need to consider to ensure you have a regret-free real estate purchase experience.  

Don’t Accept to Provide a Too Large Deposit

A developer may suggest you pay a higher deposit in exchange for a hefty discount on the sale price. This is a risky proposition. You are better off making reasonable, gradual instalments as the work progresses, such as 5% payable upon signing the contract, 5% at the halfway point and 5% upon completion of the roof and walls.

See If the Company Is Trustworthy

You can verify a construction company and its shareholders’ dependability in various ways. For example:

  • Look up the company in the Registre des entreprises du Québec to learn its shareholders’ names. Then research the shareholders online to find out if any are involved in a lawsuit or to read customer reviews.
  • Confirm that the company holds a licence with the Régie du bâtiment du Québec.
  • Consult CanLII to see if the developer or their company (former or current) has ever declared bankruptcy or has been the subject of a lawsuit.
  • Go to the Office de la protection du consommateur’s website to find out if the company has received complaints and, if so, of what type.  
  • Check the municipality’s land register to confirm that the developer does in fact own the land.
  • Go to the GCR’s Accredited Business Directory where you will find the addresses of the buildings or homes constructed by your developer. Go visit these buildings. And while you’re there, why not talk to the owners to see if they are happy with their property?

Doing your homework won’t guarantee that everything will go according to plan with the construction company, but this will allow you to eliminate potential developers from your list.


Partner with a Real Estate Broker

A broker is the key to avoiding a disappointing real estate acquisition. They know the laws, apply them, and carry out all the checks for you. By working with RE/MAX, you can even take advantage of our Tranquili-T insurance coverage, which includes legal assistance in the event of a lawsuit.  

Check the Guarantee Plan

Since 2015, the Guarantee Plan for New Residential Buildings offers protection for new buildings as long as the contractor is accredited by the GCR and registers the planned residence. Unfortunately, not all contractors do so. This is why confirming your new home is indeed covered by a Guarantee Plan so important. This plan is essential because it includes clauses pertaining to:

  • buyer relocation following construction delays
  • building defects
  • completion of work
  • repayment of the deposit made to the builders (up to $50,000)

Visit the Site During Construction

Are you having a single family, intergenerational, or other type of home constructed? Go look around the building site (safely) a few times a month. This provides you with the opportunity to check the quality of the work, that your requests are complied with and that everything is done according to best practice. You can then warn your contractor if any elements are missing or if any parts seem poorly constructed.

If you have purchased a unit in a condominium building under construction, you can also make sure that there is enough soundproofing material and that it is properly installed. Even if you are not a building expert, you can take pictures at every step of the process to serve as proof if hidden defects are discovered later on.

This is an important real estate purchase: maximize your chances of being 100% satisfied!

RE/MAX Québec

By RE/MAX Québec

By RE/MAX Québec

A leader in the real estate industry since 1982, the RE/MAX network brings together the most efficient brokers.