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Warranty coverage takes effect from the date of closing (or, in a condominium, from the date of available occupancy). In the case of condominiums, warranty coverage also includes the shared areas referred to as common elements. The coverage for the common elements begins on the day the condominium corporation is registered. (Registration of a condominium usually takes place within a few months after available occupancy). Maximum coverage for a new residence is $150,000.00 (see details in www.Tarion.com).
Deposit coverage begins the moment a deposit is paid. When you buy a new freehold home, you are protected against financial loss, including your deposit, to a maximum of $40,000.00, if the builder does not complete the sale through no fault of the purchaser (up to $20,000.00 if purchase agreement signed before February 1, 2003). When you buy a new condominium, deposits are protected up to $20,000.00 since new condominium purchasers are protected for deposits over $20,000.00 by the trust and excess deposit provisions in the Condominium Act, 1998.
The program warrants that the home is free from defects in materials and workmanship, is fit to live in, and meets the Ontario Building Code requirements for one year from the date that purchaser was entitled to occupy.
Homeowners are responsible for notifying both the builder and the Tarion New Home Warranty Program in writing of any defects before the end of the first year. If Tarion does not receive notice in writing within the warranty period, the claim might not be allowed.
Homes enrolled on or after January 1, 1991 are protected for seven years against major structural defects; a major structural defect is defined in the Ontario New Home Warranties Plan Act as any defect in materials or work that results in the failure of a load-bearing part of the home’s structure, or any defect in materials or work that significantly and adversely affects the use of the building as a home.
A builder can extend the closing date up to a total of 120 days at any time prior to closing by giving written notice of the extension. However, if the builder does not give the following written notice of delays, you may be able to claim compensation for out-of-pocket expenses. A claim can only be made when you become the owner.
A builder anticipating a delay in closing of more than 15 days must notify you at least 65 days before the original closing date and set a new closing date. The builder may extend the closing date once by up to 120 days, if you are given written notice at least 65 days before the closing date.
A builder anticipating a delay in closing of no more than 15 days beyond the original or extended date as outlined above must notify you at least 35 days before the original or extended closing date and set a new closing date.
The builder is allowed up to five days grace regarding last-minute closing delays without penalty. Beyond that, any builder who fails to give proper notice will be required to compensate you up to $100 a day for living expenses plus all direct costs caused by the delay, to a maximum of $5,000.
To be compensated, you must complete the purchase. If the builder refuses to close, call your TARION Office for information on how this will affect coverage. Keep your receipts for expenses. Claim forms are available from TARION. You must submit your claim in writing to TARION before the end of the first year warranty period.
There is no compensation for delays caused by events beyond the builder’s control, e.g., strikes, fires, civil insurrection, floods or acts of God, or for delays which are caused by the purchaser.
(For Agreements of Purchase and Sale signed on or after April 1, 1991)
As in the case for delayed closings for freehold homes, the builder may extend the confirmed occupancy date once by up to 120 days, if you are given written notice at least 65 days before the confirmed date. The builder can also have a 15-day extension if you are given 35 days notice. In all cases, builders are allowed a five-day grace period.
Any builder who fails to give proper notice will be required to compensate you up to $100 a day for living expenses plus all direct costs caused by the delay, to a maximum of $5,000.
Be sure you bring any problems to the attention of your builder and TARION in writing before the end of the warranty period. For example, if you took possession of your new home on June 15, 1998, the first, second and seven year warranties expire at midnight on June 14 of the appropriate year. Make a note of when your warranty coverages expire.
If TARION does not receive your notice in writing within the warranty period, your claim cannot be allowed. In your letter, describe the problem and ask the builder to correct it. Remember to include the enrolment number, your complete address, lot and plan numbers, or the condominium address and unit number. Condominium unit owners who experience common element problems should write to their Board of Directors once the condominium is registered. The board is responsible for bringing common element problems to the attention of the builder and TARION, if necessary.
Written notice of any complaint about a repair must be received by TARION within the time period for the repair warranty to apply.
| SALE PRICE (exclusive of GST) | Unit Fee (incl. PST & GST) |
| FreeHold and Condo | |
| Up to $100,000 | $511.75 |
| $100,000 – $150,000 | $540.50 |
| $150,000 – $200,000 | $598.00 |
| $200,000 – $250,000 | $655.50 |
| $250,000 – $300,000 | $713.00 |
| $300,000 – $350,000 | $770.50 |
| $350,000 – $400,000 | $828.00 |
| $400,000 – $450,000 | $885.50 |
| $450,000 – $500,000 | $943.00 |
| $500,000 or more | $1,000.50 |
Effective February 15, 2000, the deficit recovery fee of $100 (+GST +PST) is being removed. However, if the builder filed their enrolment form before February 15, 2000, the deficit recovery fee still applies.
If you have bought a newly constructed unit, you should attend at the property prior to closing to inspect and prepare a list of matters requiring the attention of the builder. The inspection appointment time must be arranged by you with the builder’s representative. At the time of inspection, you will complete the Certificate of Completion and Possession for delivery by the builder to the Tarion New Home Warranty Program. All items outstanding must be noted. The warranty Certificate issued should be received by you and a copy should be provided to the lawyer prior to the closing of the real estate purchase. Note: Should you omit to note a deficiency at the P.D.I., you may note it on your 30 day report form if submitted within 30 days.
As a purchaser of a new home, you have various rights pursuant to the Program and, in particular, there are provisions by which you may compel the completion or rectification of prescribed items of construction. To familiarize yourself with your rights as well as the procedures and times within which they must be enforced, refer to the brochure entitled “What Every New Home Buyer Should Know”. If you do not already have a copy of this pamphlet in your possession, please contact TARION at 5150 Yonge Street, Concourse Level, Toronto, Ontario M2N 6L8 Tel. 1-800-668-0124.
