When shopping for a new home, there are a lot of things you’ll need to consider. At the top of most people’s list is cost: What can you actually afford to buy? Another big one: location.
Somewhere in this list of considerations should also be ownership type. In Ontario, there are two main types of ownership when it comes to newly built homes: freehold and condominium. Knowing the difference early on in your new home buying journey will help you make the choice that best fits your life.
What is a freehold home?
When you purchase a freehold home, you own both the home and the lot on which it was built. Detached and semi-detached homes typically fall into this category.
The obvious advantage of buying a freehold home is that you have total control over your home and property. As the sole owner, you’re free to make whatever decisions you want about things like outward appearance, landscaping, alterations or renovations.
On the other hand, you are responsible for everything related to your freehold home, such as regular maintenance and repairs that are not covered by your builder’s warranty.
What is a condominium?
Condominium home ownership has two aspects: full ownership of some areas and shared ownership of others. As a condo buyer, you own your unit privately. What belongs to a unit may vary from one project to another, so it’s important to consult the project’s disclosure document for details about unit boundaries.
At the same time, you and other unit owners have shared ownership of the areas of the project located outside unit boundaries. These shared areas are known as “common elements,” and they can include everything from indoor pools to mechanical systems.
Condominium ownership may be attractive to you if you like the convenience of having amenities at your doorstep but don’t want the responsibility of maintaining everything yourself. In exchange for this convenience, you and all other unit owners will pay a monthly fee to the condominium corporation for the management and maintenance of the common elements. To find out more about how condominium corporations work, visit the Condominium Authority of Ontario’s (CAO) website.
You’ve bought a new home. Now what?
Before you move into your new home or condominium unit, your builder’s representative will schedule a pre-delivery inspection so that you can check for anything that may be defective, damaged or missing, as well as learn about how to operate its systems and properly maintain its various components.
Your builder-provided new home warranty, which is backed by Tarion, will take effect on the date you take possession of your freehold home or gain occupancy of your condominium unit and last for a total of seven years.
Condominiums come with a separate warranty on the common elements of the project, which begins when the project is registered and is managed by the condominium corporation.
Learn more about buying a new home
Whether you decide to buy a freehold home or a condominium, Tarion can provide support at many different stages of your new home buying and ownership journey.
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