Saving for a down payment is hard. Coming up with 20% all at once? Even harder. But here's something most people don't realize about new construction homes: you don't have to.

When you buy a new build directly from a builder, you provide the down payment in installments over months or years. That changes the math in a significant way.

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How the Deposit Schedule Actually Works

A typical builder deposit schedule looks something like this. You put down 5% when you sign the agreement. Another 5% within 90 days. Another 5% at 180 days. And the final 5% at 365 days or when you take occupancy.

That's the same 20% you'd need for a resale home. But instead of scrambling to pull it together all at once, you're spreading it out over a year or more. The schedule is outlined in the purchase agreement and usually available on the builder's website, so you know exactly what your financial commitments look like before you commit.

For first-time buyers who are getting close but not quite there yet, this structure can be the difference between staying on the sidelines and actually getting into the market.

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You're Starting With a Clean Slate

When you buy resale, you're buying someone else's choices. Their kitchen backsplash. Their carpet. Their idea of what a bathroom should look like. If you're lucky, it matches your taste. If you're not, you're budgeting for renovations before you've even moved in.

New builds flip that script. You often get to personalize finishes and color schemes, even if you buy midway through a project. No need to strip wallpaper or gut outdated kitchens. You're starting fresh with brand new everything.

And here's the practical part: new homes meet modern energy efficiency standards. Better insulation, newer HVAC systems, energy-efficient windows. Your utility bills reflect that. So does your comfort level in January.

You're also not dealing with immediate repairs. No 20-year-old roof that needs replacing. No furnace on its last legs. No plumbing that's been patched together over decades. New builds typically come with a 7 to 10 year builder warranty, which gives you coverage resale homes just don't have.

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The Paperwork Is Different

When you buy resale, you make an offer. The seller accepts, counters, or rejects. Pretty straightforward.

New construction works differently. Once you've landed on a model and lot, you sign a builder's purchase agreement. This is not the same as a resale offer. It outlines the purchase price, deposit schedule, closing date, and the terms for choosing upgrades.

Builder agreements are generally more complex than resale agreements. They have additional clauses covering things like project timeline changes, material cost adjustments, and construction delays. It's worth getting the agreement reviewed by a lawyer who's familiar with new builds. They can interpret the fine print, negotiate with the builder, and make sure you're protected if things don't go according to plan.

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The Risks You Need to Know About

New builds come with perks, but they also come with risks you need to understand before you sign anything.

Construction delays happen. A project that's supposed to close in 18 months might take 24. Budget and plan for that possibility. Don't put yourself in a position where a six-month delay leaves you scrambling.

Cancellation clauses can be harsh. If your situation changes and you need to cancel the purchase, you may lose your deposits. In some cases, you can assign the purchase to someone else, but you'll still be out some cash.

Upgrade costs add up fast. That nicer countertop, the upgraded flooring, the better appliances. It all increases the purchase price of the home. Work with a mortgage specialist to understand how upgrades affect your financing before you start picking finishes.

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First-Time Buyers Get Extra Benefits

RBC points out several advantages that are particularly relevant for first-time homebuyers right now.

You get more time to secure your down payment because you're not providing the full 20% upfront. That gives you cash flow flexibility and time to save while the home is being built.

Some lenders provide firm mortgage credit approval that lasts from when you sign the purchase agreement to when the home is built and the sale closes. When you get approved, you stay approved, even if the build takes longer than expected.

In some cases, you can lock in your interest rate for the duration of the build. If rates go up between purchase and move-in, you're protected. And some lenders let you take advantage of falling rates too, so you're covered either way.

You start building equity immediately based on today's home prices. If the property value goes up between when you purchase and when you move in, that's equity you didn't have to pay for.

And there's the GST rebate. The federal government announced a GST rebate for first-time home buyers purchasing a new build. When introduced, the rebate will remove the GST on new homes at or under $1 million and lower it on homes between $1 million and $1.5 million for all first-time buyers.

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New Build vs. Resale: The Real Differences

When you buy resale, you tour the existing home, walk through each room, see exactly what you're getting. You can meet the neighbors, explore the local area, and move in relatively quickly.

When you buy a new build, you're often choosing a floor plan from a model home or builder's catalog. Depending on the stage of development, you may get a choice of layouts, sizes, and even lots. But you're using your imagination to visualize the finished space.

Resale gives you immediate or flexible closing. New builds are based on construction timelines, though some inventory may be available sooner.

Resale gives you more room to negotiate on price. New builds offer less flexibility there, but you're getting something move-in ready with no immediate maintenance needs.

Resale is buy as is. New builds let you customize.

It's not that one is better than the other. It's that they solve different problems for different buyers.

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When New Builds Make the Most Sense

If you're a first-time buyer who's close on your down payment but not quite there, the staggered deposit structure can get you in the door sooner.

If you're moving from another country or province and need time to get settled before you commit to a full down payment, new construction gives you that runway.

If you don't want to deal with renovations or immediate repairs, starting with a blank slate makes life easier.

And if you're trying to time the market, locking in today's prices and interest rates while the home is being built can work in your favor if values rise during construction.

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The Bottom Line

New construction isn't the right move for everyone. If you need to move immediately, resale is your only option. If you want to know exactly what you're getting before you commit, touring an existing home makes more sense.

But if you're struggling to save the full down payment all at once, if you want something move-in ready without renovation headaches, or if you're trying to get into the market before prices climb further, new builds offer a path that resale homes don't.

The key is understanding what you're signing, knowing the risks, and working with professionals who can guide you through a process that's more complex than buying resale. Get your agreement reviewed. Budget for delays. Understand the cancellation clauses. And make sure you're comfortable with the builder's track record before you sign.

Done right, buying a new build can be a smart, flexible way to step into the housing market. Just make sure you're going in with your eyes open.