Enhancements to Tarion New Home Warranty Program

Thinking of buying new construction? Here are the latest enhancements to the Tarion New Home Warranty Program effective January 1, 2018:

Freehold Deposit Coverage

Effective January 1, 2018, new home purchasers placing deposits on new non-condominium freehold homes will have increased deposit coverage of 10 per cent of the purchase price up to a maximum coverage of $100,000 with minimum coverage of $60,000. Previously, these buyers were only eligible for a maximum of $40,000 in deposit protection.

Following extensive public feedback earlier this year, the minimum threshold of $60,000 coverage ensures that freehold homes will have increased coverage that reflects the realities of today’s new home marketplace.

Please note that condominium deposits are not part of the changes as condominium buyers benefit from additional protections through the Condominium Act, which requires all monies paid towards the purchase price above Tarion’s coverage level of $20,000 to be held in trust.

Warranty Coverage Extended to Condominium Conversions

Beginning January 1, 2018, all of Tarion’s warranty coverage will apply to “residential condominium conversion projects” or RCCPs, including the provisions for deposit protection and delayed occupancy coverage, and the one, two and seven year warranties.

There is one exception; the first year warranty on work and materials will not apply to pre-existing elements (e.g., a foundation or exterior cladding). Under the new regulations, builders of condominium conversion projects and vendors selling units in these projects must also be registered with Tarion.