Feb 6, 2026
Buying a home for the first time is usually a joyous occasion and a time to celebrate a momentous financial milestone.
But for Toronto resident Yvonne Tsui, purchasing her first property wasn’t a time of celebration — it was a catastrophe.
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The 39-year old told the Toronto Star she put a deposit on a pre-construction townhouse around 2017, and finally got the keys to her new residence in 2024, after paying $515,000 and making three deposits totalling 15% of the purchase price (1). But, she claims that the property she received was not what she was shown or bought.
Tsui told the Star that the property was advertised as a two-bedroom townhouse. Instead, Tsui was given the keys to a one-bedroom unit complete with a doorless den.
On top of unmet expectations, Tsui also had to pay thousands in occupancy fees — something that pre-construction owners pay before they are officially the registered owner of the property (2) — as the final sale registration took months.
In response to her harrowing ordeal, Tsui has filed a complaint with Ontario’s protection agency Tarion, an organization that assists new homebuyers with purchasing issues (3), she told the Star.
The developer, Solotex Group, said it denies any claims of improper marketing and that they are working to “rectify the complaints” as multiple owners in the four-block complex have reported issues. The CEO of Solotex, Paul Goldfisher, told the Star that Tsui's unit was, “built in accordance with the plan attached to the Agreement of Purchase and Sale.”
Tsui’s response? “I have been robbed of the joy and excitement one should feel as a first-time homebuyer.”
How pre-construction agreements work
Purchasing a pre-construction unit (be it a house or a condominium) is quite different from buying a resale home. Buyers usually purchase a yet-to-be-built property based on renderings a developer provides. During this process, the buyer may work with the developer to add or remove specific custom elements, within reason. This allows a buyer to have more say in what their final residence will look like compared to purchasing an existing home (4). But the process is arguably more complex.
The developer and the buyer agree to the terms, timeline, cost, occupancy fees and other details in a legally binding pre-construction agreement (5). This agreement also outlines the specifics of how the purchased unit will be built, including a layout plan — which was the case with Tsui’s agreement. Any representations and warranties the builder makes in the agreement regarding the build of the unit are legally binding, so if the build strays from this agreement, the buyer may have recourse to either demand changes or compensation. However, there is often leeway for developers to adjust the layout and dimensions of the unit as written into the contract. There are also other factors that do not have to be disclosed. For instance, new-build homebuyers have often bought and taken possession of a home without knowing that a massive utility box will be placed in their front yard or the French doors leading to the flex-room (often marketed as a potential bedroom) are not part of the initial build. Bathrooms can be repositioned and kitchens can have dramatic changes to layout, depending on the builder and the purchase agreement.
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Still, even with these potential adaptations, all registered builders in Ontario — and the new-build condos, townhomes and homes built by these builders — are covered under the Ontario New Home Warranties Plan Act (ONHWPA), administered by Tarion (6). If a buyer purchases a pre-constructed residence that has defects in either work or materials, they can potentially receive warranty coverage through Tarion. The emphasis is to for the buyer to work with the developer to resolve the issues with Tarion getting involved when complaints are unresolved between the parties.
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Get StartedPros and cons of buying a pre-constructed residence
So, why would a buyer, like Tsui, choose to buy a new-build home? According to Tarion’s New Home Buyers Report from 2024, almost 3 out of 4 home buyers (72%) were interested in purchasing pre-construction residences (7). The main reasons for this choice include:
- Potential for price appreciation between when the residence is purchased and when the deal closes
- Comprehensive warranty protection under the ONHWPA
- Vast customization opportunities compared to purchasing an already developed property
That said, there are drawbacks of buying a new-build, including:
- Potential for major delays due to construction issues or other unforeseen circumstances
- Market fluctuations can cause the newly built property to drop in value once construction is complete
- Condo owners and stacked townhouses have to pay interim occupancy fees on top of their mortgage and other costs, which can be a financial strain
What options do you have if you face a pre-construction debacle?
If you’re in a similar situation to Tsui with a pre-construction home build that did not go as planned, you have some options.
- Start by negotiating with your builder. Your builder signed a legally binding contract outlining the scope of the project with you. A good place to start is bringing issues forward with your developer in a respectful, evidence-based manner. Make your concerns known sooner, rather than later. Remember to document your concerns, keep a paper-trail of your communication and attach relevant documents.
- Lean on consumer protection agencies. If communication with your developer goes nowhere, you can turn to consumer protection agencies for assistance and financial help. Tarion and the Home Construction Regulation Authority (8) assist buyers with their pre-construction complaints. Tarion, specifically, can provide financial relief for buyers that have valid warranty claims, depending on the type and severity of the warranty issue.
- Hire a lawyer. While agencies can help resolve disputes, some may not be able to issue you compensation for all improper actions your developer took regarding your property. For that, you’ll need a lawyer to file a lawsuit.
- Don’t sign a Purchase Agreement without a lawyer. Finally, for buyers who have not yet signed a Purchase Agreement, consider seeking out the advice of a real estate lawyer. Look for a professional with experience handling the specific type of build you are buying (and even with the builder you are purchasing from). A few thousands spent getting a lawyer to review the purchase agreement can often save you tens of thousands in unnecessary fees.
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Bottom line
As Tsui explained in the Toronto Star interview, she is choosing to stay in her townhouse, but the entire ordeal has turned her off of buying a pre-construction home.
For most, though, a bit of due digiligence and expert guidance can help to mitigate (or even avoid) any unpleasant surprises when it comes time to take possession of your new home. Hire a lawyer to help review the agreement of purchase and sale, research the builder you plan to buy from, and become familiar with the contractual obligations your builder is bound to uphold.
Buying a home — whether pre-construction or not — is a process that comes with emotional and financial crests and valleys. What helps you weather these ebbs and flows is being prepared for unexpected changes before you sign the paperwork.
Article sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
Toronto Star (1); Tarion (2, 3, 5, 7), Metrocity Property Group (4); CAO (6); HCRA (8)
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Brett Surbey is a corporate paralegal with KMSC Law LLP and freelance writer who has written for Yahoo Finance Canada, Success Magazine, Publishers Weekly, U.S. News & World Report, Forbes Advisor and multiple academic journals. He and his family live in northern Alberta, Canada.
