Making an Offer on a House in Canada

Your first offer is a legally binding document. Understanding every element — conditions, deposit, irrevocable period — can make the difference between getting the home and losing it.

The Agreement of Purchase and Sale (APS)

In most Canadian provinces, an offer to purchase a home is made using an Agreement of Purchase and Sale (APS). Once signed by both buyer and seller with all conditions removed, the APS is a legally binding contract. Your real estate agent prepares the APS using standard provincial forms. The document specifies the purchase price, deposit amount and timing, closing date, inclusions and exclusions, and any conditions.

Key Elements of Every Offer

Element	What to Know
Purchase Price	What you are offering to pay — determined by comparables and market conditions
Deposit	Typically 5% of purchase price, due within 24 hours of acceptance; held in trust
Irrevocable Date/Time	Deadline by which seller must accept, reject, or counter — usually 24–48 hours
Closing Date	The date title transfers and you take possession — typically 30–90 days after acceptance
Conditions	Events that must occur for the deal to be firm — financing, inspection, status certificate
Inclusions/Exclusions	What stays (appliances, light fixtures) and what the seller takes (specific items)

The Deposit — How It Works

The deposit is a show of good faith, typically 5% of the purchase price, due within 24 hours of acceptance (check your APS — the timing varies). The deposit is held in your agent's brokerage trust account (or your lawyer's trust in some provinces) and applied to your down payment on closing. If you back out of a firm deal without a valid condition to rely on, you can lose your deposit and potentially face a lawsuit for the seller's damages. Take the deposit obligation seriously.

Standard Conditions to Include

Conditions give you an escape route if specific events don't occur. The most important conditions for first-time buyers are:

• Financing condition: gives you typically 5–7 business days to obtain mortgage approval. If your lender declines, you can exit the deal and recover your deposit. Never waive this unless you have unconditional mortgage pre-approval in writing.
• Home inspection condition: gives you the right to have a professional inspect the property. If the inspection reveals issues you cannot accept, you can exit. Include this on any resale property.
• Status certificate review (condos): gives you 10 days (in Ontario) to have a lawyer review the condo corporation's financial statements, reserve fund, bylaws, and any pending litigation or special assessments. This is mandatory for condo purchases.
• Sale of existing property: if you own a home already, you may want a condition making the purchase contingent on selling your current home first. This weakens your offer in competitive markets.

Multiple Offer Situations

In competitive markets, multiple buyers submit offers simultaneously on the same property. The listing agent collects all offers and presents them to the seller at a set time. In a multiple offer situation: your agent won't know other offer prices; escalation clauses (offer to beat any competing offer by $X up to a maximum) may or may not be accepted depending on local norms; sellers typically choose the highest clean offer with fewest conditions; and going in at or above asking with minimal conditions is often required to win.

Never waive your financing or inspection conditions simply to win a bidding war. The cost of buying a home with a hidden structural defect or losing your home because your financing falls through is far greater than losing one bidding war.

Offer Strategy by Market Type

Market	Strategy
Seller's market (low inventory)	Offer at or above asking; short conditions; strong deposit; flexible closing
Balanced market	Offer near asking; include all standard conditions; negotiate after inspection
Buyer's market (high inventory)	Offer below asking; include all conditions; request repairs or price reduction post-inspection

Counter-Offers and Signing Back

If the seller doesn't accept your offer as-is, they can "sign back" a counter-offer — adjusting price, closing date, conditions, or other terms. You then have until the new irrevocable time to accept, reject, or counter again. This back-and-forth can happen multiple times. Each signed-back offer effectively kills the previous one, so be deliberate about every change you make and accept.