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Requirements for Purchase Agreements

An agreement of purchase and sale acts as a legally binding written agreement that is used between both the buyer and seller in a real estate transaction. In simplified terms, it is the offer document that the buyer submits to the seller when purchasing a home

Include an Addendum

The Addendum sets out standard contract provisions related to closing dates and delays. You must include the applicable Addendum with every purchase agreement and complete it in full. 

To coincide with the launch of the Home Construction Regulatory Authority (HCRA), the Addendum was updated. Every new purchase agreement signed on or after February 1, 2021 must attach a new version (dated October 7, 2020) of the applicable Addendum.

There are no substantive changes, but the new Addenda do include small changes to reflect the new regulator (HCRA), such as replacing the reference to Tarion Registration Number with HCRA Licence Number. The new Addenda are available in PDF format here

Include a Warranty Information Sheet

The Warranty Information Sheet is a concise overview of a home buyer’s statutory warranty coverage and includes information about the new home warranty provided by their builder and backed by Tarion, the pre-delivery inspection, and deposit protection.

The Warranty Information Sheet is available in six versions: freehold homes, condominium units, contract homes, condominium conversion units, vacant land condominiums and new homes in a parcel of tied land. The Warranty Information Sheets are available in PDF format here 

Effective February 1, 2021, you are required to attach the applicable version of the Warranty Information Sheet to every purchase agreement or construction contract at the time the document is signed. 

Submit purchaser contact information to Tarion

Within 30 days after signing a purchase agreement or construction contract, you are required to submit to Tarion, in writing, contact information for the purchaser or owner, including, name, address, and email address.

Tarion will use this information to communicate important information to the purchaser or owner about warranty coverage and the importance of the pre-delivery inspection in the period before possession.

You can submit purchaser information to Tarion by downloading our Excel spreadsheet template. Once the spreadsheet is completed, you can upload it to BuilderLink or email it to The spreadsheet is also available for download on BuilderLink.

Refer Purchasers to Tarion's Homeowner Learning Hub

Our learning modules are an online learning tool comprised of interactive modules that provide overviews of specific parts of the new home buying journey and the relevant warranty information. You can find it in your resources section.

These modules include the substantive warranty process information that was formerly included in a document titled Homeowner Information Package (HIP).

You are encouraged to provide a link to the Learning Hub to purchasers.

Setting Closing Dates

As a licensed new home builder, you are required under the Ontario New Home Warranties Plan Act to provide a delayed closing warranty to purchasers. The delayed closing warranty is intended to provide purchasers with some protection against the financial impact of closing delays.

Below is a general overview of the delayed closing warranty, which is outlined in full detail in Registrar Bulletin 6F.

Closing date options

You have the option to set a firm or a tentative closing date in the purchase agreement.

Tentative Closing Date
If you set a tentative closing date, you may extend the closing date twice by up to 120 days each time without having to pay compensation to the purchaser, provided you give sufficient advance written notice for each extension. 

Firm Closing Date
If you set a firm closing date, you cannot extend the Firm Closing Date without paying compensation to the purchaser, except in cases of unavoidable delay or where you and the purchaser mutually agree to amend the purchase agreement.

The addendum & closing dates/delays

The Addendum sets out standard contract provisions related to closing dates and delays. You must include an Addendum with every purchase agreement. 

There are two Addendum forms that can be used for freehold homes depending on the type of closing date you set:

Freehold Firm Closing Date Addendum
Freehold Tentative Closing Date Addendum

The first page in the Addendum is the Statement of Critical Dates, which sets out important dates related to the home’s closing date. You must complete the Statement of Critical Dates in full, or else your purchase agreement cannot be enforceable. Tarion’s online Critical Dates Calculator is a fast and easy way to complete the Statement of Critical Dates.

The Addendum also includes parts that set out disclosure obligations, conditions of sale, and termination conditions.

Compensation for Delays

If you delay occupancy beyond the firm occupancy date and no exceptions apply – such as a mutual agreement to extend the occupancy date or an unavoidable delay – you must provide compensation to the purchaser. 

The maximum amount of compensation under the warranty is $7,500. This includes:

  • $150 per day for direct living expenses (such as accommodation and meals) for each day of delay until the date of occupancy or termination of the purchase agreement (if applicable); and,
  • Any other expenses incurred by the purchaser as a result of the delay, such as moving or storage costs.

    The purchaser is not required to provide receipts for direct living expenses but must provide receipts if they are seeking compensation for other costs such as moving and storage.
Unavoidable Delays

An unavoidable delay is an extraordinary circumstance where a closing date may need to be delayed through no fault of the builder or purchaser. This may be a strike, fire, explosion, ‘act of God’, civil insurrection, act of war or terrorism, or a pandemic. 

If such a delay occurs, you are permitted to extend all deadlines by up to the length of the unavoidable delay period without paying delayed closing compensation. You must inform the purchaser at the outset of the delay, provide an estimate of how long it will last and give written notice as soon as the delay has ended.

Tarion's Risk-Based Inspection Program

This program was created in response to a recommendation from Ontario’s Auditor General and replaces the previous Targeted Inspection Program. For an overview of the program, including FAQ's, please visit our Risk-Based Inspection page linked below. You can also refer to Registrar Bulletin 9 on our Registrar Bulletins & Advisories page for specific details.

Tarion's Risk-Based Inspection Program