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When you can live in, but not own, your new condo

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When you can live in, but not own, your new condo

What you should know about interim occupancy fees, title transfer and your warranty

When you buy a pre-construction condominium, you’re prepared for the fact that it will be months – or even up to three years – before you can expect to move in. But what you may not realize is that once your condo unit is built, it still may not be officially yours. In fact, you may have to pay a monthly fee to the builder until the time that the title of your unit can be transferred to you.

“Interim occupancy” is the period between when you can move into your condo and when you officially own it. The move-in date is set by your builder, with permission by your local municipality, once your unit is declared fit for occupancy. This is the point at which your interim occupancy period begins and it will typically last between two to three months. It could, however, stretch much longer, especially if your unit is on a lower floor of a highrise and the upper floors still have to be finished.

During interim occupancy, you have to pay a monthly fee, as determined by the Condominium Act, that covers three things: The interest on the unpaid balance of the purchase price of your condominium unit; municipal taxes estimated for your unit; and common expenses to keep the building running. While you are paying this interim occupancy fee, you won’t be making mortgage payments. Those will start once you have official ownership of your unit, and at that point you will no longer have to pay the interim occupancy fee.

So, the reality is that you might be living in what could feel like a construction zone as the rest of the units and the common elements (lobby, lounge, pool) are completed. Once they are, the project will be registered with the municipality and the individual units will be transferred to the owners. This is when the builder will set your final closing date – when you take full ownership.

What’s important to know is that your new home warranty actually begins as soon as you are granted occupancy of your unit. However, the warranty on amenities or common elements that you’re eagerly waiting to be finished doesn’t begin until the condominium corporation is registered.

To figure out what’s covered by which warranty, you need to start by determining the boundaries of your own unit. You can find this information in the Disclosure document that is attached to your purchase agreement or the registered Declaration and Description filed once the condominium corporation has been registered. This will tell you the unit and common element boundaries and responsibilities for repair and maintenance.

For issues with parts of your unit, it is your responsibility to submit the appropriate warranty form to Tarion. So even if you don’t legally own your unit yet, you should be aware of the warranty form submission deadlines and make sure you submit on time. If you notice defects in the common elements, these should be reported to your condominium corporation representative (sometimes this is the property manager) for them to report to Tarion within their warranty timelines.

Your journey to condo ownership is finally complete on final closing. This is when the completed building is registered and you pay the balance remaining on your final purchase price in addition to any adjustments. When you do, you will receive the title to your new home, your mortgage will be registered on your title and your interim occupancy agreement will end. At this point, your condo is all yours.

While interim occupancy might feel like an exercise in delayed gratification, the final result – a new condo to call your own – should be worth the wait.

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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Common elements aren’t a common responsibility

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Common elements aren’t a common responsibility

Purchasing a condominium is a bit of a two-for-one deal. While you’re buying a unit that has specific physical boundaries, you’re also becoming part owner of amenities that could range from fitness facilities, rooftop terraces and party rooms to less glamourous elements such as heating systems, parking garages and elevators. These are the ‘common elements’ of your condo project. While you are entitled to use them (or at least benefit from them), management of the common elements – and their warranty – is the responsibility of the condominium corporation.

The warranty on your unit begins when your unit is ready for occupancy. The common elements warranty coverage doesn’t begin until the building is finished and the declaration and description for the project is registered by the developer at the local land registry office.

So, what are the declaration and description? They are documents that outline important details for condo owners, such as the boundaries, designated use and proportion of common expenses allocated to the unit, as well as repair and maintenance obligations. If you want to know exactly where your unit ends and the common elements begin, check the declaration.

Although common elements often provide a lot of marketing flash to help drive sales, they can be some of the last things finished in your project. If, for example, you’ve bought a condo on a lower floor in a highrise, you might be among the first to move in – before the common elements have been completed. This means that you might have to wait a while to use that chic party room or luxurious pool that helped sell you on the project in the first place.

Under the Ontario New Home Warranties Plan Act, the condominium corporation is the ‘owner’ of the common elements of the project. This includes “exclusive use” common elements – things such as your balcony or your backyard – that no one but you gets to use. Unlike unit owners who fill out and submit their own warranty forms for issues in their units, the Condominium Act requires that the condo corporation hire a consultant to prepare a performance audit identifying any deficiencies in the common elements, such as defects in workmanship or Ontario Building Code violations. The performance audit generally includes surveys in which unit owners can report issues they’ve observed in the common elements. The condo corporation will submit the performance audit to Tarion as a warranty claim for the common elements.

The condo corporation will also appoint a designate — often the condominium manager — to work with Tarion and the vendor to resolve deficiencies reported in the audit.

While you as a unit owner do not get involved in the warranty claims process for common elements, you do have a role to play in protecting these shared amenities and ensuring that the warranty coverage on them stays intact. Here are a few examples of what’s not covered by the warranty:

  • Damage caused by unit owners or visitors;
  • Alterations, deletions or additions made by a unit owner or the condo corporation;
  • Damage resulting from improper maintenance by unit owners or the condo corporation.

So if you’re inviting the high school rugby team over for a post-championship celebration, make sure the party room doesn’t become a casualty. Or if you’re planning to do work on any of your exclusive-use common elements – adding a garden to your balcony, for example – notify your condo corporation and obtain permission from them to undertake it.

Common elements are for the common benefit of all. If there are issues, be sure to report them to your condominium manager for them to report to Tarion within their warranty timelines. And if you have any questions about common elements coverage, contact Tarion at 1.877.9TARION or 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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Consumer Protection: Document All Deficiencies

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Consumer Protection: Document All Deficiencies

Most new homes will require some adjustments after move-in and Tarion is there to help

When you move into your new home, you hope that everything will be perfect. However, in reality, some aspects of your home may require fixes. In most cases, new homeowners and builders work well together to get the repairs done so that owners can fully enjoy their homes.

But what happens when you and your builder disagree on whether the items that need to be repaired are covered under the warranty?

That’s when Tarion can step in. We can help you settle disagreements about warranty coverage when you and your builder are unable to do so. There are a few steps you need to take to ensure we can help you.

First, you must submit a warranty claim to Tarion within the proper timeframe using one of our forms. The forms include the 30-day form, the yearend form, the second-year form and the major structural defect form.

One of the easiest ways to submit a form is through MyHome, Tarion’s online portal (there’s also an app) that owners of newly built homes can use to manage their warranty.

Once you register with MyHome, you can find the proper form for your warranty claim, fill it out and submit it easily from your computer or mobile device.

After you submit the claim, your builder has a specific number of days, called a repair period, to resolve all the items on your form that are covered by the warranty.

If your builder doesn’t fix all your warranty items by the end of the repair period, you can request conciliation. This is a process in which Tarion decides whether the items on your warranty claim form are covered under the warranty.

Conciliation may include a visit to your home, or what we call a desk assessment – a review of all the documentation related to the claim. You should provide all evidence – documents, photographs, videotapes, etc. – that you want Tarion to consider when assessing your claim.

A Tarion Warranty Services Representative, acting as a neutral and impartial decision maker, will review your documentation, determine if the items on your claim form are covered under the warranty and issue a report that explains Tarion’s decision. If Tarion agrees that your claim items are covered, your builder is given a final 30 days to resolve them. If that doesn’t happen, we’ll resolve your claim directly with you.

Some homeowners are worried that working with Tarion on their unresolved claims will affect their relationship with their builder. However, you need to protect your investment and your warranty rights. So, if you can’t agree with your builder about repairs to your new home, know that we’re here to help.

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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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.



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Consumer Protection: Tarion

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Consumer Protection: Tarion

It is business as usual at the new home warranty provider.

In late March, the Ontario government announced it intends to make substantial changes to the regulation of the building industry and Tarion. You may have read about these proposed changes, as the announcement generated quite a bit of media attention.

As a result, shortly after the announcement, Tarion staff began to receive a lot of enquiries from both new homeowners and builders, asking how these changes affect them. They wanted to know where they can get help on warranty questions and issues.

I would like to assure new homeowners and builders that, for the time being, it is business as usual at Tarion.

The government’s plans for changing how the industry is regulated are wide-ranging and complex. They will significantly affect how Tarion operates in the future. However, I expect it will likely take some time before these changes come into effect.

In the meantime, our staff remains ready, willing and able to provide information, resources and answers to homeowners and builders alike on the province’s new home warranty.

I think it is worth reminding consumers that Tarion is more than just a warranty provider. For more than 40 years, we have proudly served to protect new homebuyers and owners by anticipating and responding to changing markets and consumer needs.

Some of our improvements and initiatives have raised the bar for builders, which ultimately benefits consumers. For example, we introduced construction performance guidelines to ensure a consistency in construction quality and we recently brought in new education requirements for new builders to improve qualification standards for builders entering the industry.

Our warranty program has also seen significant enhancements over the years, again in response to the changing needs of consumers and the industry. For example, warranty coverage limits have increased to reflect the rising costs of homes and repairs.

The seven-year warranty covers illegally built homes – something no other warranty in Canada offers. And, we were the first and only province to provide coverage for radon gas remediation and for delayed closings.

Along the way, our staff has won international awards for customer service. This is not surprising to us. In annual surveys we sent to new homeowners and builders, Tarion consistently scores above an 80 per cent approval rating for its customer service.

Given that we help administer the warranty to more than 350,000 homes and regulate more than 5,000 builders, I believe that rating is a strong indication of our dedication to customer service and consumer protection.

One hot issue in today’s housing marketing is deposit protection coverage for buyers of new homes and condominiums. This is especially important now, as house prices continue to escalate.

That’s why, as a consumer protection organization, we support changes to deposit coverage limits to better protect consumers against builders who, for one reason or another, are unable to complete building homes. We are therefore pleased that the government indicated it wants to work with Tarion to review deposit protection coverage limits in the coming weeks and months.

To sum up, I believe the changes the government is proposing could take considerable time to put in place. So, for the time being, our staff remain committed to delivering their award winning customer service, and new home owners and builders should take comfort that it is business as usual.

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 home buyers, visit tarion.com or find them on Facebook at facebook.com/tarionwarrantycorp


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Buy With Confidence : Tarion

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Buy With Confidence : Tarion

Tarion – Ensuring your new home is protected.

Your new home is more than just bricks and mortar. It’s where family comes together, traditions are founded and celebrated. Your home is an extension of your personality and lifestyle; it’s part of who you are.

There is no doubt that your new home is special to you. As one of the biggest investments you will ever make, it’s also why you should ensure it’s protected. Whether you’re thinking about buying a new home or you’ve already moved in, there are many things you should know when owning a newly built home.


In Ontario, most new homes come with a warranty from the builder that is backstopped by Tarion. Tarion helps homeowners enjoy their new homes by ensuring Ontario’s registered builders fulfill the terms of their warranty.

Since 1976, Ontario’s new home warranty program has registered over two million homes and paid out hundreds of millions of dollars in warranty claims. Since then, Tarion has remained committed to protecting new homeowners’ rights across our province.

For more than 40 years, Tarion has protected new homebuyers and owners by ensuring that builders are accountable for standards in construction and customer service. Tarion’s role allows Ontarians to buy a new home with confidence and have somewhere to turn if these standards are not met.

Since its inception, Tarion has made numerous improvements to the warranty to expand protections, but new homebuyers and owners must do their part too. It’s important to understand the warranty and follow the correct reporting processes. Some tips to keep in mind to protect your new home:


For freehold homes, you’re protected up to $40,000 for deposits and $20,000 for condominiums (in addition to the protections in the Condominium Act). While these limits may seem too low for heated markets like the GTA, they are above provincial averages.


All new homebuilders in Ontario must be registered with Tarion – it’s the law. Don’t be swayed by builders who claim you don’t need the statutory warranty. You can check to see if your builder is registered by visiting the Ontario Builder Directory at Tarion.com.


Before you move in, complete your Pre-Delivery Inspection with your builder. This is an official record of the condition of your home before you moved in, so be sure to note anything that may be damaged, incomplete, or not working properly.

Tarion and the Ontario new home warranty program are here to help protect your investment – so you can enjoy your home to its fullest.

For more information about the new home warranty, visit Tarion.com.


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