The deemed statutory warranties created by the Ontario New Home Warranties Plan Act apply for the most part to all purchases of new homes whether or not the vendor is registered or the home is enrolled. There is no statutory definition of “new home”. Rather, the protections of the ONHWP Act are available only if the applicable definitions of “home”, “builder”, “vendor” and “owner” apply to the dwelling. Generally:
- A “home” is a self-contained one-family dwelling that is not built for occupancy for temporary periods or seasonal purposes. A “home” can be either a freehold home (including a contract home) or a condominium unit, including the common elements. It will include such homes whether it is a principal residence or a second recreational home, as long as it is constructed to year-round occupancy requirements under Part 9 of the Ontario Building Code.
- A “builder” is a person who undertakes the performance of all the work and supply of all the materials necessary to construct a completed home whether for the purpose of sale by the person or under a contract with a vendor or owner.
- A “vendor” is a person who sells on his/her own behalf a home not previously occupied to an owner.
- An “owner” is a person who first acquires a home from its vendor for occupancy.
Tying the definitions together one could very generally describe a “new home” as a self-contained, residential dwelling unit built to permanent occupancy standards by a builder who has agreed to complete all material aspects of the dwelling and that was not previously occupied prior to the initial sale (e.g., not a conversion, not a renovation, not previously occupied by the vendor).
This summary is by its nature not comprehensive. The foregoing requirements are referred to elsewhere in this section of the website as the “new home requirements.”
Single Family Dwellings
Single family dwellings that meet the “new home requirements” have statutory warranty coverage. This could be a detached home, a townhome, a row-home or a unit in a quadruplex, as long as it is a self-contained, one-family unit. It may be a home in a new subdivision or one constructed on a vacant or cleared lot.
Condominium Dwelling Units
Residential dwelling units in a standard condominium project or a dwelling built on a vacant land condominium unit will have coverage if they meet the “new home requirements.”
Statutory warranty coverage also extends to common elements that benefit a condominium dwelling unit with two exceptions: the common elements of a vacant land condominium corporation, and common elements of a common elements condominium corporation are not covered.
Home on a Parcel of Tied Land (POTL/CEC)
Some new home purchase transactions involve homes built on a freehold parcel (sometimes called a parcel of tied land or “POTL”) where the land is tied to a common elements condominium corporation. The residential dwelling unit in such a transaction will have statutory warranty coverage (as long as it otherwise meets the “new home requirements”), but warranty coverage does not extend to the common elements of the common elements condominium corporation.
A contract home is a home constructed under a contract between a builder and an owner of land that provides for the construction of a home on the land. A contract home that meets the “new home requirements” will have statutory warranty coverage. However, a contract home, instead of having deposit protection, has financial loss protection.
A contract home is not always covered under the statutory warranties. For example, if someone other than the contracted builder exercises significant control over the construction of all or part of the home, the home may not be eligible for statutory warranty coverage. Learn more about other Types of Homes not Covered.
A modular home, sometimes called a Kit Home, is a complete home composed of finished sections built off-site. Statutory warranty coverage applies to the home if the assembled sections are placed on a permanent foundation that meets Part 9 of the Ontario Building Code and was installed by the same builder that sold the home to the purchaser and if it meets the “new home requirements”.
A mobile home generally is a transportable, single or multi-section self-contained home built off-site. Statutory warranty coverage applies if the mobile home is placed on a permanent foundation that meets Part 9 of the Ontario Building Code and was installed by the same builder that sold the home to the purchaser and if it meets the “new home requirements.”
Model Homes, Sales Offices, Inventory Homes
The question of whether or not statutory warranties extend to sales of pre-built homes held in “inventory” or homes used as a display or model homes or sales offices to home buyers can be complex. The statutory warranties were developed for new homes and do not extend in certain circumstances to dwellings previously occupied. You should discuss with the vendor the nature and extent of the warranties being offered by the vendor and in particular any exclusions to warranty proposed by the vendor. Any proposed exclusions or exceptions should be specifically identified and itemized. These matters should all be addressed before signing the purchase agreement. If you have any questions, contact Tarion at firstname.lastname@example.org
Log homes are built with logs, which form an integral part of the structure and the building envelope. A log home is covered under the statutory warranty as long as it has been constructed in accordance with Part 9 of the Ontario Building Code and otherwise meets the “new home requirements.”
A shell home is a home that meets the “new home requirements” where the builder completes the “shell” but does not finish the interior elements. For single family homes and low-rise condominiums, the “shell” includes the essential elements (footings/foundation, framing, exterior cladding, building envelope, and heating, electrical and plumbing distribution systems) and installation of insulation, vapor barrier and drywall. For high-rise condominiums, the “shell” includes the essential elements and installation of insulation, vapor barrier and drywall on the exterior walls only; the builder is not required to install drywall on the interior walls. Statutory warranty coverage applies to the work completed by the builder.
Resale of “New” Homes
Statutory warranty coverage for a home that meets the “new home requirements” begins on the date the home is completed for possession and remains in effect until the end of the warranty period, even if the home is sold before the warranty expires. Thus, a resale home that is less than 7 years old may have some remaining statutory warranty coverage.
Residential Condominium Conversion Projects
A residential condominium conversion project is when an existing non-residential building (e.g., warehouse, church) is converted into a condominium and pre-existing elements of the building, such as the foundation or frame, are incorporated into the new design and construction of the project. Buildings that were originally built for residential use – like rental apartment buildings – would not qualify for coverage unless otherwise specifically permitted.
If you have any questions about your new home's warranty, call us at 1-877-9TARION, or send an e-mail to: email@example.com