Pre-Construction Lots & Builder Packages

Pre-construction means a building permit has NOT yet been issued and no foundation work has commenced. You’re buying a lot + a builder option to construct your home there on agreed plans. New construction means a building permit IS issued and the home is either under construction or recently completed.

Royal LePage Turner Realty categorizes pre-construction listings under MLS® Land/Lot category (consistent with CMHC’s pre-start methodology), and permitted-and-building listings under Residential. The bright line is the building permit. This is stricter than current NLAR practice; we’re operating to this standard as a Central Region pilot of the in-progress New Construction Task Force recommendations.

Because there is no house yet. A pre-construction listing is a lot + a builder option to build — not a home. Categorizing it under Residential would pollute comparables for actually-completed homes (every CMA depends on apples-to-apples comps), mislead buyers shopping built inventory, and create enforcement ambiguity at NLAR.

The categorization also aligns with how CMHC counts housing — CMHC would not count a pre-permit listing as a housing start until foundation work commences. Bringing NLAR MLS practice in line with CMHC’s federal reporting methodology is the cleanest single fix for the broader data-quality problem in NL new-construction listings.

Deposits on pre-construction are typically staged rather than paid in a single lump. A common Atlantic Canada pattern is 10% at signing, then a series of smaller progress deposits at construction milestones (foundation poured, framing complete, drywall complete, etc.), with the balance due on closing.

Important: in NL there is no statutory deposit-protection program for pre-construction buyers (unlike Ontario’s Tarion deposit protection or BC’s 2-5-10 warranty). Confirm with the listing agent: where will deposits be held (builder’s lawyer trust account vs. listing brokerage trust account vs. unprotected)? Are deposits refundable if the build runs significantly long? Get this in writing before signing.

Pre-construction listed prices are often the base build + lot, with significant additions for upgrades, finishes, lot premiums (premium positions, walkout basements, corner lots), appliance packages, landscaping, driveway, and deck. Federal HST of 15% applies to new construction (resale homes are HST-exempt); the rebate may be claimed by the builder (and netted from price) or by the buyer post-close.

Before signing, request an all-in price in writing covering: lot, base build, lot premium, all selected finishes, appliance package, landscaping scope, HST handling (inclusive or plus), and any developer/HOA fees. For pre-construction, also confirm whether the base spec changes if you make selections later (it usually does).

Yes — most NL lenders offer two paths. A completion mortgage funds in a single advance when the home is finished, much like a resale closing. A progress-advance (or draw) mortgage funds in stages alongside the builder’s milestones, which works better when you own the land first and contract the build separately.

Rate-hold periods on completion mortgages typically run 90–120 days but can be extended for new-build buyers (some lenders offer 6–9 month holds for new construction). Talk to your mortgage broker early in the process — long timelines and rate movements both matter on pre-construction.

The Atlantic Home Warranty Program (AHWP) is the regional new-home warranty serving NL + the rest of Atlantic Canada. Coverage is voluntary — the builder enrols (or doesn’t) on a per-unit basis. Base coverage tiers are typically 1 year on workmanship and materials, 2 years on mechanical systems (plumbing, electrical, HVAC), and up to 10 years on major structural defects (MSD).

Before committing, ask the listing agent: is this build enrolled in AHWP? If yes, request the enrolment certificate number (AHWP maintains a public verifier). If no, what warranty (if any) does the builder offer in its place? NL does not legislate mandatory new-home warranty enrolment (unlike Ontario’s Tarion, BC’s 2-5-10, etc.), so enrolment varies builder-by-builder.

The big risks: build delays (NL weather, supply chain, labour); upgrade-price creep (the all-in price grows as you make finish selections); builder financial difficulty (deposits at risk if the builder fails mid-build, especially without AHWP enrolment); rate movement if your mortgage rate-hold expires before closing; change orders initiated by the builder citing supply or code changes.

Mitigations: get the contract reviewed by a real-estate lawyer experienced with builder purchase agreements; ask for the deposit-protection arrangement in writing; pin the rate-hold period; review the change-order and delay clauses carefully; verify the builder’s reputation through prior buyers and through CHBA-NL membership status if applicable.

Once a building permit is issued and foundation work commences on a unit you have under contract, the listing migrates from MLS® Land/Lot to MLS® Residential category — and on our site, from /listings/pre-construction/ to /listings/new-construction/ with a BUILDING NOW badge. Construction continues through framing, mechanical rough-in, drywall, finishes, and inspection.

When the structural and mechanical inspections pass and the municipality issues an occupancy permit, the listing updates to READY TO MOVE IN status. Your interim closing happens at this point if you have a progress-advance mortgage; otherwise the final closing aligns with occupancy.

If you want to track a specific build, ask the listing agent to add you to milestone updates — many builders provide foundation-poured, framing-complete, drywall, and pre-occupancy walkthrough notifications.