Tag Archives: Tarion

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Consumer Protection: More Deposit Protection

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Consumer Protection: More Deposit Protection

Changes to act means down payment coverage has increased

When you buy a resale home, you can see what you’re getting before you sign an agreement and invest your money.

However, when purchasing a newly built home, your home may only exist as a floorplan when you put your deposit down. It’s then on your builder to bring your investment to life.

But if your home never makes it beyond the floorplan and your builder does not — or cannot — return your deposit, it’s good to know that your deposit is protected.

As of January 1, changes to regulations under the Ontario New Home Warranties Plan Act mean that new homebuyers of non-condominium freehold homes have more of their deposit money protected than ever before.

How does this work?

If you paid $600,000 for your home or less, you are eligible to receive up to $60,000 to reimburse you for amounts paid to the builder. If your home was more than $600,000, you are eligible to receive up to 10 per cent of the purchase price, to a maximum of $100,000.

In addition, the passage of the Strengthening Protection for Ontario Consumers Act, 2017, means that this deposit protection now includes other payments, such as those made for upgrades and extras.

While this enhanced coverage only applies to non-condominium freehold homes, it’s important to note that condo buyers are also protected by the Condominium Act, which requires that the full deposit be placed in trust. If, for some reason these funds are released improperly from the trust, Tarion will cover up to $20,000.

A new home is a big investment – one of the biggest of our lives. And while you can’t put a price on peace of mind, I’m pleased that we’re able to provide deposit protection that is more in line with today’s home prices.

If you’re looking to buy a new home this year, I encourage you to visit Tarion. com to learn more about Tarion’s new deposit coverage.

Howard Bogach is president and CEO of the Tarion Warranty Corporation. His column appears 10 times a year in HOMES Magazine. For more information about how Tarion helps new homebuyers, visit Tarion.com or find them on Facebook at Facebook.com/TarionWarrantyCorp

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Consumer Protection: Condo Conversions

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Consumer Protection: Condo Conversions

Condos come in all shapes and sizes. Some buyers prefer slick, modern, multi-story towers while others are looking for buildings with more character and maybe a little history. If the latter is what you’re in the market for, I have some good news for you.

In many urban areas, warehouses and other old industrial structures are often converted into condos that incorporate some of the building’s more interesting features (e.g., large windows, framing, brick walls) into the design. The industry term for these types of developments is “residential condominium conversion projects” or RCCPs. The features of a structure incorporated into an RCCP are called “pre-existing elements.”

Effective January 1, 2018, all of the warranties (one-year, two-year and seven-year) included in the Ontario New Home Warranties Plan Act (ONHWPA) now apply to these types of condos with one exception: any pre-existing elements – which, for example, might include an exposed brick interior wall – would not have the one-year warranty regarding the home being constructed in a workmanlike manner and free from defects in material.

Y Lofts by Atria

Up until now, RCCPs did not come with new home warranty coverage under ONHWPA because they weren’t entirely ‘new’ buildings.

But there’s still more good news. If you’re putting down a deposit on a condo unit that is part of an RCCP, you’ll be happy to know that you’re now entitled to the same deposit protection and delayed occupancy coverage as other condo buyers. This means that your deposit, and any amounts paid for upgrades and extras, must be placed in trust and refunded in full if the project does not proceed. This should give you some added confidence that your money is protected if the unexpected happens.

Researching your builder will also be easier. Under the new regulations, builders of RCCPs and vendors who wish to sell units in these projects must be registered with Tarion. This means that you’ll be able to look them up on the Ontario Builder Directory on Tarion.com.

So what happens if your rental apartment building is being converted into condos? These condos would not be eligible for coverage because the existing building was already built for residential living and converting the building doesn’t involve major changes. Most of the original components remain, with only minor changes made to the building.

This ONHWPA warranty coverage for RCCPs applies to projects where the first purchase agreement in the project is signed on or after January 1, 2018.

If you have your eye on a new loft with a little more history to it, I hope these changes will help you buy with confidence knowing that you now have a safety net. To learn more about this warranty coverage, you can visit Tarion.com or if you have questions, you can email customerservice@tarion.com.

HOWARD BOGACH is president and CEO of Tarion Warranty Corp., a private corporation established to protect the rights of new homebuyers and to regulate new home builders.

Tarion.com

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Tarion

Tarion expands deposit coverage for new homebuyers in 2018

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Tarion expands deposit coverage for new homebuyers in 2018

Enhanced deposit coverage and new warranty protection for condo conversions

Ontarians hoping to take the leap into homeownership can buy with added confidence thanks to expanded consumer protection measures coming into force on January 1, 2018.

Purchasers placing deposits on new freehold homes will now 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.

New homebuyers will also benefit from the recent passage of the Strengthening Protection for Ontario Consumers Act, 2017, which extends the deposit protection provisions to include other payments, such as those made for upgrades and extras.

Following extensive public feedback earlier this year, these changes will help bring deposit coverage in line with today’s new home market.

Coverage for down payments on condominium dwelling units will remain unchanged since these units benefit from significant protection under the trust provisions of the Condominium Act, which require all monies paid towards the purchase price to be held in trust. Additionally, deposits made for condominium purchases are protected up to $20,000 by Tarion.

For those looking to purchase converted condominiums, changes to the Ontario New Home Warranties Program mean that their units will now have warranty coverage. These developments, referred to as residential condominium conversion projects, or RCCPs, turn existing buildings into condos that incorporate some of the existing building’s more interesting features (e.g., large windows, framing, brick walls) into the design.

RCCPs will benefit from the same statutory warranty coverage extended to all condominium projects, including deposit protection, 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.

To learn more about the expanded protections, new homebuyers are encouraged to visit Tarion.com



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Tarion Report: Your Opinion Matters

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Tarion Report: Your Opinion Matters

Tarion Surveys New Condo Owners

When you’re in the market for a new condo, you tend to do a lot of research, including asking friends, family and colleagues about their experiences. Once you’ve been through the buying process yourself, you can in turn share your insights and opinions with someone else looking for this same advice.

Collecting this type of first-hand knowledge is exactly what Tarion’s new home owner survey is all about.

Every fall, Tarion surveys new condo and home owners across the province about their buying and homeownership experience. The survey questions cover things like the Agreement of Purchase and Sale, their builder’s level of customer service before and after moving into their home, their understanding of their warranty and their satisfaction with Tarion.

This year, Tarion will send out more than 50,000 surveys to consumers who moved into a new home or condo between October 1, 2016 and September 30, 2017. To ensure as many homeowners as possible can participate, the survey is offered online in English, French, Mandarin, Farsi and Punjabi.

As a new condo owner, your opinion matters. Tarion provides information and advice to home and condo owners throughout the buying process as well as after they take possession. The survey helps to inform Tarion about how they’re doing so that they can continually improve their customer service.

Rest assured, your feedback can lead to tangible results. For example, in response to consumer input, Tarion has added new features to their MyHome portal that allows homeowners to manage their warranty online and introduced a new MyHome Planner app to help with the new home and condo buying process.

But Tarion’s not the only one who wants to know what you think – your builder does too. That’s why the survey asks questions such as: Were there any issues with your new home or condo? Did the builder listen and address them in a timely way?

Where Tarion receives enough completed surveys, builders are given detailed (but anonymous) reports with their scores and Tarion then follows up to help them determine how they can improve their customer service.

Through the survey, you also help choose the recipients of Tarion’s Homeowners’ Choice Awards. Both finalists and recipients of these awards have this recognition added to their record in the Ontario Builder Directory (on Tarion.com) for everyone to see. This can help future new home or condo buyers when they are doing their research to find a builder.

If you have taken possession of a new condo in the past year, look out for the Tarion survey. It only takes a few minutes to complete, and your responses will help improve customer service for new home and condo owners across Ontario.

To search for a builder in the Ontario Builder Directory, visit Tarion.com.

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Consumer Protection: Partnerships are the Backbone of Success

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Consumer Protection: Partnerships are the Backbone of Success

When investing in a new condominium, you want to know that your new home will be properly built, safe to live in and covered by a new home warranty if anything goes wrong.

Tarion plays a role in fulfilling those expectations — but we don’t work alone. Like any thriving industry, partnerships are often the backbone of success.

Historically, the many different parties in the new home building industry have worked together on a number of issues like protecting buyers from illegally built homes, radon awareness and emerging trends. Take for example, the falling condo glass issue that has been prominently featured in the media since around 2011.

Once it became apparent that this was more than an isolated incident and involved various building projects by different builders, the City of Toronto and building industry association members requested an expert panel to tackle the problem.

The panel, comprised of industry partners like engineers, the Ministry of Municipal Affairs, municipalities from across the GTA, building science experts, condo builders and Tarion, requested an emergency change to the Ontario Building Code. The revised standard required glass balcony guards to be both tempered and laminated so they would act like a windshield on a car and stay together if breakage occurred.

Mirabella Condos by Diamante.

Whether your new home is a house or a condo, getting it from sales brochure to a standing livable structure involves a complicated system of standards, permits, inspections and finally, warranty coverage. Proper protection for you, the homeowner, throughout this process requires coordination and cooperation from Tarion and two of our long-standing partners – the Ontario Building Officials Association (OBOA) and the Ontario Homebuilders’ Association (OHBA).

So it’s fitting that after a long history of informal collaboration, Tarion recently joined with the OBOA and OHBA to formalize this relationship and announce the creation of the Ontario Building Partnership.

While each organization plays a different role within the industry, we share a commitment to increase consumer confidence, enhance the new home ownership experience and continue to ensure Ontario’s home building industry is regarded as a world class leader.

So how does this partnership benefit you, the home buyer? Among other things, it means we will be expanding our efforts to advocate for a province-wide model to protect home buyers from illegal building, collaborating on consumer education and homeownership issues and working on establishing more consistent building standards across the new home building industry.

Ontario’s home building industry is changing at a rapid pace. As those changes occur, it is more important than ever that we are all are aligned in protecting consumers. After all, your new home or condo is likely the largest investment you’ll make in your lifetime. We want to make sure you purchase with confidence and we are proud that this partnership brings together three industry leaders who all share this commitment.

HOWARD BOGACH is president and CEO of Tarion Warranty Corp., a private corporation established to protect the rights of new homebuyers and to regulate new home builders.

Tarion.com

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Consumer Protection: How Do You Know What’s Covered By Your Warranty?

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Consumer Protection: How Do You Know What’s Covered By Your Warranty?

The first year of homeownership is a critical time to report any problems

When you are buying a new home, you want everything to be perfect. Unfortunately, things can — and do — go wrong. Whether it’s something relatively minor, like unfinished trim around your bathroom door, or a potentially major issue like a crack in your foundation, your new home warranty is there to protect you.

Once you sign your purchase agreement, you should receive a New Homeowner Information Package from your builder. It will outline the package of warranties that protects new homeowners for up to seven years and $300,000 in coverage.

But how do you know if your faulty light switch or unfinished driveway is covered by warranty? It’s not always easy to tell, but our award winning customer service team is here to help answer your questions

As of June, our team had already fielded 23,960 phone calls, 10,734 emails and 1,064 online chats. Approximately two-thirds of all these inquiries came from homeowners, many of whom needed advice on how their warranty work.

When I talk with our call centre reps, they tell me that one of the most common questions they receive from homeowners is, “How do I know if items are covered by the warranty?”

Your new home warranty consists of one-year, two-year and seven-year warranties that cover various elements of your home’s construction. If you don’t know whether an issue will be covered under your warranty, you can consult the Construction Performance Guidelines, which are available on Tarion.com or via MyHome, Tarion’s online portal for managing your warranty. You can also call or email us to ask.

The first year of homeownership is a critical time to report any problems you have with your home. You can submit two forms in the first year after you take possession – one within the first 30 days and one within the last 30 days.

While Tarion’s acceptance of your form does not automatically mean that everything on the form will be covered by your warranty, it does provide a written record of your issues. This is why we recommend that you include everything on your form.

As a new homeowner, you obviously want to maintain a good relationship with your builder. If you’re worried about submitting your form, you should remember that you’re not being a tattletale – you’re protecting your rights.

Responsible builders will address warranty issues in a timely manner but if your builder doesn’t, the forms you submit help us help you.

The Tarion team is here to ensure your new home is safe and protected.

Our reward is comments like these from one happy homeowner: “Thank you so much for handling this so quickly. We appreciate the excellent customer service you have always given us!”

Howard Bogach is president and CEO of the Tarion Warranty Corporation. His column appears five times a year in HOMES Magazine. For more information about how Tarion helps new homebuyers, visit Tarion.com or find them on Facebook at Facebook.com/TarionWarrantyCorp

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Special Report: Tarion

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Special Report: Tarion

How to protect yourself when building your own home

You’ve bought the perfect piece of property and now you want to build your dream home. Before you start looking for a builder, there are some important things you should do that will help protect you and your investment.

When you hire someone to build your home, it’s called a “contract home” because it is built on your own property, not on property being developed by a builder.

Contract homes come with certain risks. For example, the relationship between you and your builder can potentially break down. Fortunately, Ontario’s new home warranty provides protection for consumers in situations like this. If your builder fails to substantially fulfill your contract, you may have coverage for your financial losses.

The following are tips that can help protect you as you negotiate with your potential builder:

  • Make sure your builder is registered with Tarion. If they are not, they are operating illegally. You can confirm that the builder you want to hire is registered by visiting the Ontario Builder Directory at Tarion.com.
  • Get a written contract. Verbal agreements can easily fall apart and can’t be verified, making it difficult to prove what was agreed to between you and the builder. Attach plans, specifications and construction schedules and document all change orders.
  • Get help from a real estate lawyer who has knowledge and experience with contract homes. The lawyer can prepare the contract and help you understand your rights and obligations under the contract.

Of course, even a thorough contract cannot prevent agreements from breaking apart for a variety of reasons. So if your builder has stopped working on your home, you need to contact Tarion for help.

The first thing Tarion will tell you is to stop all work on your home and do not let anyone else work on it. If you submit a claim to Tarion, it needs to assess your home in the state it was in when your builder stopped construction.

The next step is to submit a financial loss claim to Tarion. If you’re able to show that your builder failed to substantially perform your contract through the builder’s default, and that the payments you made to your builder exceed the value of the work and materials provided by the builder, Tarion may compensate you for that shortfall, to a maximum of $40,000.

In an ideal world, nothing will go wrong as you build your dream home. The more prepared you are however, the more peace of mind you’ll have. And if things do go wrong, Tarion is there to help.

Tarion.com

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Report: Questions to Ask a Real Estate Lawyer

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Report: Questions to Ask a Real Estate Lawyer

When Buying a Newly Built Condominium

If you’re in the market for a new condo, your real estate lawyer can be a good source of advice and of important information about your warranty rights and responsibilities.

Before you sign your Agreement of Purchase and Sale — a critical first step toward becoming a condo owner — here are a few common questions to ask your real estate lawyer:

1 Is my entire deposit protected?

Under the Condominium Act, the whole deposit must be held in trust or alternate security provided. So, your entire deposit is likely protected in the event that the builder cannot complete the project. Tarion provides deposit protection of $20,000 in the rare instance where trust money is improperly released.

2 Why is it taking so long to build my condominium?

Condominium projects can take a long time to build. To better understand the anticipated timeline for your condo, carefully review the Addendum to your Agreement of Purchase and Sale with your real estate lawyer. Here’s what to look for: On page one of the Addendum, you’ll find a few key dates:

  • The first date (listed as either “Firm” or “Tentative”) is called the “Occupancy Date.” Think of this as the builder’s first and best estimate for when your condo will be ready for occupancy. With proper notice, this date can be moved by the builder.
  • The second date is the “Outside Occupancy Date.” This is the builder’s estimate for completion in the event there are unanticipated delays. This date cannot be moved unilaterally by the builder because it is a firm commitment and is usually set years in the future.

On page two of the Addendum you’ll find information on the status of the project at the time of signing. For example, the builder must check off if he/she has obtained formal zoning, and if construction has commenced. If neither of these boxes are checked “yes,” the project may be years away from completion. Keep in mind, however, that money held in trust doesn’t get released until the project gets finished.

3 Are upgrades covered by my warranty?

Almost all new condos in Ontario are protected under warranty. But that warranty only covers what is contained in your Agreement of Purchase and Sale. Extras — such as upgrades that are not included in your contract — will not be covered under the warranty. What’s more, anything agreed to on a handshake or verbal promise will not be protected. So if you request additional items, work with your real estate lawyer to make sure everything is in writing!

For more tips for condo buyers and to learn more about new condo warranties, visit Tarion.com

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Consumer Protection: Building Communities One Home at a Time

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Consumer Protection: Building Communities One Home at a Time

Tarion is committed to protecting new homes for Ontarians — but more often than not what we consider our ‘tools of the trade’ would be computers and phones, not drills or saws. Last month however, a team of Tarion employees showed what they could do with hammers and nails as they helped build homes for two deserving families in London, Ontario.

The construction project, sponsored by Habitat for Humanity, was the 10th build that Tarion staff have helped support over the past decade. This year, we were helping to build homes for the Kassa and Cooper families.

The Kassa family — a mother and two adult children, one of whom is in a wheelchair — currently live in an apartment that was never built to accommodate someone with disabilities. The Kassa’s new home will be equipped with accessibility features that will enable the daughter with cerebral palsy to move more freely and allow her mother to more easily care for her.

The Coopers are a family of seven that fled a civil war in Liberia and came to Canada in 2005. They have been squeezed into a tiny, cramped apartment ever since. Their new home, while still modest in size, will provide them with a lot more space to grow and thrive together.

Most of our volunteer team had never worked in construction nor had they participated in a Habitat build before. I was able to catch up with a few of the employees who took part and ask them about their experience. Despite being tired and a little achy, all of them said they would do it again.

One employee told me he now has a better appreciation for the hard work and craftsmanship that goes into building a new home.

Another said she felt honoured to play a part in these families’ homeownership stories.

Tarion’s relationship with Habitat for Humanity began over 20 years ago when the organization first registered as a new home builder in Ontario. Since that time, we have waived enrolment fees for over 1,000 of their homes, which amounts to more than $520,000 in savings! Enrolment fees are what builders pay to register every new house or condominium unit in Ontario’s new home warranty program.

Volunteering for Habitat for Humanity is a rewarding and educational experience for staff and a crucial part of Tarion’s culture as a caring organization that is committed to building better communities across the province.

The Coopers and Kassas will soon be able to move into their new homes and we are very proud to have helped change the lives of these two families.

HOWARD BOGACH is president and CEO of Tarion Warranty Corp., a private corporation established to protect the rights of new homebuyers and to regulate new home builders. Tarion.com

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Greater deposit protection coming for Ontario’s new homebuyers

Greater deposit protection coming for Ontario’s new homebuyers

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Greater deposit protection coming for Ontario’s new homebuyers

Buyers of new homes in Ontario will soon have greater deposit protection upon a new policy and regulation proposed by Tarion coming into force.

Based on extensive public feedback last spring, Tarion is proposing to increase deposit protection for non-condominium freehold homes from the current $40,000 to 10 per cent of purchase price to a maximum coverage of $100,000 and a minimum of $60,000.

The minimum threshold of $60,000 coverage ensures that all non-condominium freehold homes will have increased coverage under this proposal; this means that non-condominium freehold homes with a purchase price below $600,000 will have up to $60,000 in coverage.

The proposed changes are contained in a draft policy and regulation that Tarion posted today on Tarion.com for public comment. This proposal has also been posted on Ontario’s Regulatory Registry.

The new deposit protection coverage is expected to be in place in January 2018.

As well, if Bill 166, the Strengthening Protection for Ontario Consumers Act, 2017 is passed, then upon Royal Assent the current deposit protection under the Ontario New Home Warranties Plan Act (ONHWPA) would be extended to include other payments such as those made for upgrades and extras.

The proposed policy and draft regulation will be posted on Tarion’s website and on Ontario’s Regulatory Registry for 45 days. We encourage consumers and others to visit Tarion.com or Ontario’s Regulatory Registry to read the regulation and provide feedback.

Deposits with respect to condominium dwelling units are not part of the proposed changes because condominium dwelling units already enjoy significant protection: any deposit amounts are protected by the trust provisions of the Condominium Act, 1998 as well as by coverage under ONHWPA of up to $20,000.

Currently, deposits for new non-condominium freehold homes are protected under the ONHWPA up to a maximum of $40,000.

Deposit protection levels, under ONHWPA, for non-condominium freehold homes and condominium dwelling units were last changed in 2003 and the Ontario housing marketplace has changed dramatically since then with the escalation of new homes prices across the province.

In 2016, Tarion publicly committed to a review of deposit protection for Ontario’s new homebuyers. The Ministry of Government and Consumer Services also publicly stated its desire for Tarion to move forward with a review in this current marketplace.

tarion.com



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