How Does Pre-Construction Deposit Work?

In this article, we will explore how a pre-construction deposit work.  We will use an example to do the illustration.  The following table represents a typical sample deposit arrangement for pre-construction condominiums.

Example of Deposit Structure


  • $10,000 on Signing
  • Balance of 5% in 90 days
  • 5% in 180 days
  • 5% in 365 days
  • 5% on Occupancy
Based on the above example, the deposit structure work as following:

Date of Signing

This is the date on which you formally accept the purchase and sale agreement, and it becomes fully executed by the developer. On this day, you will be required to provide a bank draft for $10,000, payable to the developer’s legal counsel in trust. This $10,000 will be held in trust by the developer’s legal team.

Post-Dated Cheques

You will also need to provide post-dated cheques for three specific deposit installments: at 90 days, 180 days, and 365 days from the date of signing. Notably, you won’t need to provide post-dated cheques for the occupancy deposit.

First 90 Days Deposit – This amounts to 5% of your purchase price minus the initial $10,000 deposit.

Second 180 Days Deposit – This equals 5% of your purchase price.

Third 365 Days Deposit – Again, this is 5% of your purchase price.

All these post-dated cheques should be made payable to the developer’s legal counsel in trust. You’ll hand over these post-dated cheques to the developer at the time of signing, along with the bank draft.

It’s essential to recognize that every condominium development can have a different deposit structure. This example is just a generic illustration. Some condos may require less in deposits, while others might have more frequent deposit intervals. Occasionally, there may be promotions that alter the deposit requirements or extend the deposit schedule.

If you have any questions or uncertainties regarding the deposit structure or any other aspect of the process, please feel free to reach out to our ENSŌ Realty concierge. We’re here to provide assistance and address all your inquiries.

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