What is an agreement of purchase and sale?

An agreement of purchase and sale, usually called an APS, is the written contract used in Ontario to buy and sell real estate. It names the buyer and seller, describes the property, sets the purchase price and deposit, and lists the conditions that must be met before the deal closes, such as financing or a satisfactory home inspection. Ontario real estate transactions are normally built around this document, and a lawyer or licensed agent typically prepares or reviews it.

In a rent-to-own arrangement, the APS works alongside a separate lease or lease-option agreement. The lease covers the monthly rent, the occupancy rules, and the term during which the tenant can exercise an option to buy. The APS sets out the price and closing terms that will apply if the option is exercised. Some agreements also address how a portion of each rent payment may be credited toward the purchase price, and what happens to those credits if the buyer does not go ahead. Reading the two documents together is the only way to see the full set of obligations.

The APS matters because it is the document that makes the purchase enforceable. Without a clear APS, a rent-to-own tenant may hold a lease and a verbal promise to buy, which is much harder to rely on if a dispute arises. Ontario buyers should confirm who is responsible for repairs, property taxes, and insurance during the rental period, and make sure the APS and lease do not contradict each other. If you are comparing providers, you can browse the rent-to-own homes category in this directory to find businesses that work with these contracts.

This entry is general information, not legal advice. Ontario rules on deposits, disclosure, and tenancy can change, so review any draft with a real estate lawyer before signing.