Planning to buy a custom home or a condo that's still in the planning stages? Dreaming of building your own dream house? Here are some tips to guide you through the process.
“Stones do not make the house a home: the hosts do.”
- Indian proverb
For this type of purchase, you'll need to be available on a regular basis to make major decisions. A self-construction could take you 20-30 hours per week1 for the duration of the project.
Of course, you can hire a project manager who'll take charge of the whole thing. But since it's your home, you'll still have to be responsible for certain decisions, and you'll need to make a significant personal investment.
Financing the construction of a home requires greater involvement from your bank. An authorized inspector will verify the progress of the work before gradually freeing up more funds. During the last inspection, the inspector must certify that work is 100% complete and the home is ready for occupancy.
Wondering how much you could borrow to buy or build a home? Use the calculator below.
It's important to do business with the right builder or manufacturer when you buy a custom or prefab home. Ask about their experience, visit previous projects, request references and scrutinize their estimates. Also make sure they have the necessary licenses and permits to carry out the work.
Need help? National Bank maintains a database of recognized builders. Ask your mortgage advisor for more information.
Monitor the progress of the work and check that the budget is being followed. The main construction steps are usually as follows: excavation, pouring foundations, framework, exterior finishing, installation of windows and doors, plastering and interior finishing.
For a self-construction, the Bank generally allows a maximum of 12 months to complete the home.
Learn about your rights under the new home warranty plan, which may protect you in the event of a building infraction or delay. If you live in Quebec, the Quebec government can issue a tax refund equivalent to 50% of the QST (up to $9,804) and 36% of the GST (up to $6,300).
You should also find out if the contractors involved in building your home are entitled to sell or take possession of it home if you fail to pay.
Designing your dream home? You'll need to set your budget, then find a plot of land that suits your needs.
Next, you'll draw up a construction plan and have it assessed by the Bank or the loan insurer. Get the necessary permits, and don't forget to take out general insurance for the duration of the work, as well as home insurance once work is complete.
Reference sheets to help you plan
The Building Your Own Home pamphlet sets out a list of steps to be completed before, during and after you build your home.
The Renovating Your Home pamphlet provides advice to help you organize your renovations.
The Having a Home Built for You pamphlet sets out everything you need to know about having a builder or manufacturer build your home.