- Under the Condominium Act, the disclosure statement must provide buyers with a comprehensive picture of the condo project.
- The disclosure is a snapshot at a point in time.
- A legitimate disclosure for a new condo should be substantial.
The most important document in a pre-construction condo purchase is not the glossy brochure or the floor plan. It is the disclosure statement — a dense, often hundreds-of-pages-long package that the Condominium Act requires every Ontario developer to provide before the 10-day cooling-off period begins.
Most buyers never read it. That is a serious mistake. The disclosure statement contains information that will govern how you live in the building, what you pay, what the builder can change, and what rights you have. This article explains what the disclosure statement must contain, what to look for, and what red flags should send you straight to a lawyer.
What the disclosure statement is required to include
Under the Condominium Act, the disclosure statement must provide buyers with a comprehensive picture of the condo project. As of writing, the required contents include:
The declaration, description, and bylaws
These are the governing documents of the future condo corporation. The declaration establishes the boundaries of the units and common elements, the allocation of common expense contributions among unit owners, and any exclusive-use common elements. The description is a survey-based document that maps the physical layout. The bylaws govern day-to-day corporation operations.
Reading the declaration carefully reveals:
- What square footage is counted as part of your unit (sometimes surprising)
- What percentage of common expenses your unit bears
- Whether your parking space is a unit, exclusive-use common element, or simply common element — each has different ownership implications
- Any restrictions on how units can be used (pets, short-term rentals, etc.)
The proposed management agreement
The disclosure must include the terms of any property management agreement proposed for the building. Management fee structures, contract lengths, and renewal terms matter because they will affect your monthly common expenses for years.
The first-year budget
The first-year operating budget is perhaps the most scrutinized item in the disclosure. It projects the income and expenditure of the condo corporation in its first year of operation.
Why the first-year budget deserves close attention:
Builders have an incentive to keep the projected first-year budget low — lower projected maintenance fees make units easier to sell. If the budget is artificially depressed, the condo corporation's elected board will face pressure to raise fees significantly in year two.
Look for:
- Are utility estimates realistic for a building of that size in that location?
- Is the reserve fund contribution plausible, or suspiciously small?
- Are there any major expenses (like a concierge or 24-hour security) that seem underestimated?
Some sophisticated buyers hire a condo reserve fund or property management consultant to assess the budget. For a major purchase, this expense is often worthwhile.
The Tarion/HCRA warranty information
The disclosure must confirm the project's registration with Tarion and provide warranty information, including deposit protection and the statutory warranty coverages that apply.
Material facts
The builder must disclose any "material facts" — information that a reasonable buyer would consider important. This includes facts about the location (known environmental issues, proximity to proposed infrastructure), phasing of the project, shared facilities with other phases, and any existing encumbrances on the land.
Legal description of the land
The disclosure includes the legal description of the property and confirmation of the developer's title to it (or their contractual right to acquire it). This matters because some developers sell units before they actually own the land.
What the disclosure statement does not tell you
The disclosure is a snapshot at a point in time. It does not guarantee:
- That the building will be completed on the projected timeline
- That the first-year budget was accurately projected
- That the amenities shown in renderings will be delivered as illustrated
For these reasons, the disclosure is a starting point for your due diligence, not a comprehensive guarantee.
Red flags to look for
A suspiciously thin disclosure package. A legitimate disclosure for a new condo should be substantial. A package that is very short may be missing required elements.
An unusually low first-year budget. Compare the projected per-square-foot maintenance fees with comparable completed buildings in the same area. If the projection is significantly below market, question it.
Extensive rights for the builder to change the project. Some declarations and agreements reserve sweeping rights for the developer to amend the project, change phasing, add or remove amenities, or alter common elements. The more one-sided these provisions, the more risk you carry.
Shared facilities agreements with other phases. If your building will share a gym, pool, or parking with a future tower the developer has not yet built, the costs and governance of those facilities can be complex.
Missing Tarion registration or incomplete warranty information. Every new condo should be registered with Tarion. If the registration is absent or incomplete, that is a concern.
How to actually review a disclosure statement
The honest truth is that most buyers cannot review a disclosure statement effectively on their own. It requires legal training to understand what is standard versus unusual, what clauses are enforceable versus problematic, and what omissions matter.
The right approach is to:
- Receive the disclosure statement at the sales centre or by delivery.
- Immediately identify when the 10-day rescission window starts.
- Retain a lawyer immediately — ideally before you sign, but certainly within the first day or two of receiving the disclosure.
- Ask the lawyer to flag the most important provisions and any concerns.
- Make an informed decision before the window closes.
Frequently asked questions
When does the 10-day cooling-off period start?
The 10-day rescission period starts when you receive the complete disclosure statement — not when you sign the agreement. If the disclosure is incomplete, the clock may not have started.
Can the builder update the disclosure statement after I receive it?
Yes. Material amendments trigger a new disclosure obligation and a new rescission window. Track every document you receive from the builder and note the date.
What if the disclosure statement is in English and I am more comfortable in another language?
The statutory right is to a disclosure in the language of the agreement (typically English or French). You have the right to take the disclosure to a translator or have your lawyer explain it. Do not sign anything until you understand it.
Is a condominium information meeting required?
Some large condo corporations hold information sessions or require buyers to acknowledge key facts in the disclosure. This varies by project — check your agreement for any such requirements.
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