24 October 2014
Ken Ramsay

Know the Ins and Outs of your New Condo's Warranty

In 1976, the "Ontario New Home Warranty Program" was created by the Government of Ontario. This program which now goes by Tarion Warranty Corporation, is in place to ensure that builders follow provincial legislation, which in turn protects homeowners. Tarion registers new developments, offers new home warranty enrollment, investigates illegal building issues, ensures high quality of building standards, and makes decisions when there is a disagreement between the builder and the homeowner over what items are covered. Warranties are initiated from the date a homeowner takes possession of the building from the builder. The warranty will stay in place even if the home is sold

There are three warranty stages:

  • One Year Warranty
    • For one year the builder will ensure that the home is:
      • free from defects in work and/or materials
      • fit to live in
      • meeting Ontario Building Code requirements

  • Two Year Warranty
    • For two years the builder will ensure that the home is:
      • free of water entry via basement or foundation walls
      • free of defects in work and/or materials (this includes windows, doors, and caulking) that allow for water entry
      • free of defects in work and/or materials in the electrical, plumbing, and heating systems
      • free of defects in work and/or materials that affects the exterior (such as brickwork or vinyl siding) in such a way that it causes detachment, displacement, or deterioration
      • free from violations of Ontario Building Code regulations that affect health and safety (fire safety, insulation, air and vapour barriers, ventilation, and more)
      • free from major structural defects
  • Seven Year Warranty (Major Structural Defect Coverage)
    • In addition to the builder's two year warranty against major structural defects, Tarion offers protection between years three though seven.

TarionWarranty

(Source: Tarion)

It is just as important to know the things that are NOT covered, such as:

  • defects in design/materials/work by homeowner
  • secondary damage such as personal injury
  • normal wear and tear
  • normal shrinking caused by drying after construction
  • damage caused by dampness or humidity that stemmed from use of things such as humidifiers without proper ventilation
  • damage caused by homeowners or visitors
  • damages resulting from acts of God
  • damages caused by municipal services, and more

In order to make the most of your home warranty, it is highly recommended that you attend the Pre-Delivery inspection (PDI). This allows you to be aware of the condition prior to moving in. You will have the opportunity to note any deficiencies yourself, such as incomplete or missing items in the PDI provided by your builder.  I like to attend all PDI's with my cleints. The builder will fix the small details if you ask, but if you don't they won't! Secondly, it is important to keep track of warranty deadlines so that forms are submitted in time and no warranty rights are revoked (they will not accept late forms). Tarion even offers a web-based service called MyHome  which makes it easy to manage your warranty information, receive alerts on deadlines, and receive e-correspondence.  I highly recommend to all of my cleints that are purchasing new that they register with Tarion MyHome.

If you live in a condo, there is the Common Elements Warranty to consider. Common elements are things that are shared in the building (ie: heating system, some windows, garage units, elevators). These elements may not be included in your PDI. A performance audit of all common elements must be carried out between six and ten months after the condo was registered (required by the Condominium Act), so if you notice any damages to common elements, you need to contact your property manager. 

The better you understand the different types of warranties and how they work, the less stressed you will be over any present or future coverage concerns!

If you are interested in learning more about home warranties please call or email me anytime or visit the Tarion Homepage.