When people buy a new home, they want to have confidence that it has been built well and according to the standards set by law. Tarion Warranty Corporation is a private corporation that regulates new home builders and protects the rights of new home purchasers through the Ontario New Home Warranties Plan Act. With tens of thousands of houses and condominiums sprouting up across the province every year, especially in Toronto, it is important to be aware of the protection entitled to new homebuyers.
One of the major responsibilities handled by Tarion is the licensing of all new home and condominium builders in Ontario, ensuring builders have the technical experience, customer service capacities and financial stability to perform their job. Consumers are advised to do as much research as possible prior to the purchase of a new home and Tarion has helped make this a little easier through the publicly-accessible Ontario Builder Directory. The Directory provides important information about new home builders including whether they are licensed, how many homes they have built and whether Tarion has had to resolve warranty claims on their behalf. It also shows builders who have had their license refused or revoked.
In addition to licensing builders and maintaining the builder directory, Tarion protects new homebuyers with mandatory warranty coverage. The coverage begins even before homeowners move into their new homes with deposit protection, delayed closing coverage and protection against financial losses for contract homes.
Once you take possession of your new home, there is a one, two and seven year warranty. The one year warranty ensures protection against Ontario Building Code violations as well as defective materials and workmanship. It requires that the new home be habitable and protects against unauthorized substitutions. The two year warranty provides coverage for water penetration, defects in plumbing, heating and electrical work, as well as defects in materials used in exterior cladding, doors, windows and caulking. Ontario Building Code violations regarding health and safety are also covered in the first two years of possession. The seven year warranty covers major structural defects. The warranty also includes coverage for shared areas of a condominium building, known as common elements, such as the recreation area and elevators.
Tarion also provides online resources to help homeowners and builders manage the warranty process. Through MyHome, Tarion’s online warranty portal, purchasers can submit warranty forms and receive automatic emails informing them about warranty deadlines. With more than 73,000 homeowners using the service in 2013, Tarion’s research has shown that MyHome users are consistently more satisfied with their Tarion experience than those who had not used the service. Builders also have the ability to oversee their warranty status online through BuilderLink, including the option to enrol homes and manage inspections.
Conciliations & Claims
Tarion has also noted that claims activity over the years has been on the decline, one reason being that issues are now more frequently being resolved between the homeowner and the builder directly. This has partly been attributed to Tarion’s efforts in encouraging resolution by educating and communicating with builders, in addition to a conciliation fee structure which favours resolution. It is in the builder’s best interest to resolve items before Tarion steps in to inspect a home at the homeowner’s request. Inspections can lead to chargeable conciliations when an item is covered under the warranty and the builder has not resolved the issue within the applicable repair period.
Chargeable conciliations are placed on a builder’s permanent record, which is accessible through the Ontario Builder Directory. A $1,000 charge is also levied upon the builder if during the inspection there is at least one item found that is covered under the warranty. Chargeable conciliations can also impact a builder’s registration renewal, providing further incentive to resolve disputes before a claim is launched.
One important consumer protection initiative that Tarion is focused on is illegal building—builders who are either not licensed by Tarion or who do not enrol homes under the warranty. Tarion has worked with the government to amend legislation making it more difficult for builders to avoid providing a warranty. Builders and vendors in Ontario who fail to register or enrol new homes, as required by law, can face possible fines of up to $100,000 and imprisonment of up to one year. Although municipalities work with Tarion in identifying illegal builders, Tarion hopes the changes to legislations will allow them to be actively involved in the building permit process to help further reduce illegally built homes.
In closing, I have given you an in-depth analysis of Tarion and how Tarion can help protect you and your life-long investment. Please contact me anytime at 647-220-9588 or email me at email@example.com for any questions pertaining to new home construction.