Moving into your new Downtown Toronto condo before you actually own it can feel both exciting and confusing. You get the keys, but the mortgage has not started and some parts of the building are still under construction. If you are approaching interim occupancy, you need to know what it is, what you will pay, your rights, and how to plan your move. This guide breaks down the process, fees, risks, and practical tips so you can move in with confidence. Let’s dive in.
Interim occupancy explained
Interim occupancy is the period when your builder gives you possession of your unit after the city issues an occupancy permit, but before the condo is registered and title transfers to you. You can live in the unit, yet you do not own it until final closing. The Condominium Act sets out this framework for new condos across Ontario, and it is very common in Toronto high‑rises where lower floors finish first. You take possession after your Pre‑Delivery Inspection and you will see title transfer only once the building is registered and final closings occur. Learn how the process works in Ontario and review the Condominium Act provisions.
Occupancy vs ownership
During interim occupancy, you have keys and can move in, but legal ownership has not transferred. Your mortgage typically does not fund until final closing. The period begins when the builder grants possession following the city’s occupancy approvals and ends when the condominium is registered and your title is transferred. Until then, the developer controls the building and provides services that the condo corporation will later manage.
What you pay each month
Under Ontario law, developers can charge a monthly occupancy fee. This fee cannot exceed three parts: interest on the unpaid balance of your purchase price at a prescribed rate, a reasonable estimate of municipal taxes, and the projected common expenses for your unit. See the limit in section 80 of the Condominium Act. Importantly, this is not a mortgage payment and does not reduce your purchase price. Tarion explains this clearly in its condo buyer guide.
How the interest is set
The interest component uses a prescribed rate outlined in Ontario Regulation 48/01. In practice, the regulation looks to the posted one‑year conventional mortgage rate published for the month your occupancy begins. Always confirm the exact rate for your month. See the regulation here and check the Bank of Canada posted rates series for the current figure.
Quick example costs
Here is a simplified example to show the scale. If your purchase price is $700,000 with a 20 percent deposit, the unpaid balance is $560,000. If the prescribed rate was 6.09 percent in April 2025, the monthly interest portion would be about (6.09 percent divided by 12) times $560,000, which is roughly $2,842. Add an estimate for municipal taxes and projected condo fees, and your total could land in the $3,500 to $4,000 plus range in this hypothetical. Actual numbers vary by building and month, so verify the exact breakdown in writing with your developer.
Budget and next steps
Plan for several months of occupancy fees and set aside a buffer for tax true‑ups and any shortfalls. Ask the builder for a detailed fee breakdown that shows the interest calculation, the tax estimate, and the projected common expenses, plus when the prescribed rate is fixed for you. Keep in mind that if interim occupancy lasts more than six months, the reserve fund portion must be held in trust and passed to the condo corporation at registration. If you believe fees exceed what is allowed, speak with your lawyer and review the Act’s limits.
Your rights and warranties
Your unit warranty begins the day you take possession. Attend your Pre‑Delivery Inspection to document any items that need fixing and register on Tarion’s MyHome to track timelines and submit claims. Start with Tarion guidance on the PDI process and the warranty claim timelines. While you are in interim occupancy, the developer must provide building services and maintenance that the condo corporation will later handle, as set out in the Condominium Act. Also note that standard Residential Tenancies rules for rent do not apply to these occupancy fees under the Act.
Practical Downtown move‑in tips
Moving into a tower in the core takes coordination. Before booking movers, secure a service‑elevator time slot, confirm moving hours, loading access, and any insurance certificates required by the building. Many developers publish move‑in checklists and procedures, like this example of common move‑in logistics. Expect some amenities to open later and plan for noise, dust, and contractor traffic while upper floors and common areas finish. Set up utilities as directed by the builder and confirm temporary parking and locker access if those areas are not ready yet.
Risks and how to reduce them
- Long occupancy periods can be costly since the payments do not build equity. Ask for realistic registration timelines and keep a cash cushion.
- Estimates for taxes and common expenses may change. Keep every statement and request written calculations from the builder.
- Mortgage timing can shift. If your pre‑approval expires before final closing, your rate could change. Speak with your mortgage professional early.
- Construction disruption is normal. Plan flexible delivery dates, protect furniture, and confirm elevator pads and access routes in writing.
For objective education on pre‑construction timelines and rights, review the Condo Authority of Ontario’s guidance.
Taxes, HST, and local rules
During interim occupancy, the developer is usually the registered owner for municipal purposes. When the building registers, make sure any property‑tax or Vacant Home Tax declarations are properly handled to avoid liens. Review the City’s Vacant Home Tax rules and declarations. HST rebates for new homes depend on your situation and timing. See the CRA’s new housing rebate overview and consult a tax professional.
Renting during occupancy
Because the condo is not yet registered and title remains with the developer, leasing rules during interim occupancy come from your Agreement of Purchase and Sale and the builder’s permissions. Some developers restrict leasing and short‑term rentals until after registration. If you plan to rent, get written confirmation of what is allowed and when.
Get guidance that protects you
Interim occupancy is common in Downtown Toronto, but the details matter. You deserve clear numbers, a firm plan, and responsive support from offer to final closing. If you want a structured, client‑first approach to your pre‑construction move and beyond, reach out to the team at OwnIt.ca. We will help you review documents with your lawyer, plan your budget and move, and protect your interests from keys to title.
FAQs
What is interim occupancy in Toronto condos?
- It is the period when you can move into your new unit after the city issues occupancy approvals, but before the condo registers and title transfers to you. See Tarion’s condo buyer guide and the Condominium Act for details.
Do I pay a mortgage during interim occupancy?
- Usually no. You pay an occupancy fee to the builder until final closing, and mortgage payments normally start when title transfers. Tarion explains this in its guide.
What makes up the occupancy fee?
- Three parts: interest on the unpaid balance at the prescribed rate, an estimate of municipal taxes, and projected common expenses as allowed under section 80 of the Act.
How is the interest portion calculated?
- The prescribed rate is set by regulation and references posted one‑year conventional mortgage rates for your occupancy month. See O. Reg. 48/01 and the Bank of Canada series.
When does my warranty start on a new condo unit?
- Your unit warranty starts on your occupancy date. Attend your PDI and use Tarion’s MyHome to submit claims within timelines. Learn more about the PDI and claim schedules.
What should I confirm before booking movers downtown?
- Service‑elevator booking, allowed move hours, insurance requirements, loading access, and temporary parking or locker arrangements. Many developers publish checklists like this example of move‑in logistics.
