Development charges and levies on new homes: the cap explained
By Dinesh Jindal, licensed REALTOR® · Reviewed November 2026
Development charges fund roads, water, transit and other infrastructure for new homes. They are one of the largest and least visible closing costs.
How they reach you
The price usually includes the charges as of signing. Most agreements let the builder pass on increases and certain levies on closing, up to a cap in the schedule.
What to look for
- The cap amount and exactly which charges it includes (development charges, education levies, park levies, public art).
- Charges listed outside the cap.
- Whether the cap is per unit, fixed, or tied to municipal increases.
Protect yourself
- Compare caps across projects, not just prices.
- Ask whether a lower or fully capped amount is on offer during VIP release.
- Have your lawyer confirm the cap during the cooling-off period (condos).
Dinesh lists the cap for every project he sends you. Read the closing costs guide · Book a call
Quick answers
Who pays development charges on a new home?
Municipalities charge them to the builder, and the builder usually builds them into the price. Increases after you sign can be passed on to you unless your agreement caps them.
What is a good development charge cap?
There is no standard. Compare the dollar cap between projects of a similar size; a lower cap, or a full cap with no pass-through, protects you more.
Are development charges negotiable?
The municipal charges are not, but the cap in the agreement is often improved as a launch or VIP incentive.
General information, not legal, tax or financial advice. Programs, limits and rebates change; confirm current rules with Dinesh Jindal, your real estate lawyer and your mortgage professional before you sign.