In most cases when you buy a pre-construction condominium unit, the municipality of your new condominium unit will grant occupancy alongside the official transfer of ownership to the purchaser when construction is complete.
However, there are instances where a municipality will grant interim occupancy, which means that the purchaser is able to occupy the unit but the official title has not been transferred yet and parts of the rest of the building – for example units on higher floors or the common elements – are still being finished.
Only once the construction of the building is complete and the condominium is registered with the municipality will the purchaser receive legal title to the unit.
How long does interim occupancy last?
An interim occupancy period can last anywhere from a few weeks up to a year or more. The length of your interim occupancy period typically depends on the stage of construction when you took occupancy of your unit as well as any requirements on the part of the municipality that must be fulfilled by the builder before final closing can take place.
The municipality will issue an occupancy permit when it determines that your unit is "fit for occupancy." Fit for occupancy is based on the requirements of the Ontario Building Code, and it’s important to understand that this does not always mean 100% complete.
Having this occupancy permit allows the builder to give purchasers the ability to move into their unit while construction is being finished on other parts of the building. While some homeowners may choose to move into their unit at this point, it’s not a requirement that you do.
Your interim occupancy period will last until construction of the building is finished, and the condominium is registered with your municipality.
The interim occupancy fee
During the interim occupancy period, you will be required to pay a monthly fee to your builder, whether you move into the unit or not. This interim occupancy fee is based on guidelines set by the Condominium Act and includes:
- the interest on the unpaid balance of the purchase price;
- the estimated monthly municipal taxes for the unit; and,
- the projected common expense fees for the unit.
Interim occupancy fees are only applicable during the interim occupancy period, and they are not credited to the final purchase price of your condo.
When does the warranty begin?
It is very important to note that the warranty on your condo unit begins when your interim occupancy period begins, not when you first move in and not when the title officially transfers over to the purchaser.
You can report any warranty matters with your unit, such as any defects or unfinished work, to your builder by filling out and submitting a warranty form through MyHome, Tarion’s online service for homeowners. Be sure to register for MyHome as soon as possible after the interim occupancy starts, and be aware of timelines for submitting warranty requests.
You can also request assistance from Tarion at any time.
For more information about owning a newly built condominium and how Tarion can provide support, visit our Learning Hub.