Looking forward to the new year, new homeowners may feel more confident in Ontario’s new home warranty system, as the province has announced a complete overhaul of the Tarion Warranty Corporation.
Through the Rebuilding Consumer Confidence Act, the province of Ontario plans to reduce the role of builders at Tarion in an effort to make it more consumer focused. A report from the Auditor General earlier this year pointed out that nearly 9,700 consumer requests between 2014 and 2018 were dismissed due to restrictive deadlines. The report found that executives at Tarion were receiving hefty bonuses while new home buyers were struggling to correct issues with their new homes.
In the wake of the Auditor General report and the province’s recent announcement, the CEO of Tarion stepped down last week. The province says that moving forward, the board will not consist of builders and developers, and there will also be a separate regulator for builders. Tarion represented builders and new home buyers, which was seen as a conflict of interest.
Ontario plans to improve the single administrator model for warranty and protection delivery, determine a more efficient dispute resolution process, and also promote better new built homes. For example, in the near future, it may be mandatory for a new home warranty administrator to conduct an inspection of a new home before move-in.
"When consumers get the keys to their new home they should feel confident their home has been built properly, and that any defects will be taken care of in a timely manner," said Lisa Thompson, Minister of Government and Consumer Services, in a release. "Home warranties and protections need to keep home owners safe, and ensure homes are built well."
In 2018, there were more than 63,000 new homes enrolled in the warranty and protection program, and more than half were condo units. During the same year, there were 5,563 new home builders and vendors registered with Tarion.
"Our government recognizes that Tarion has not done nearly enough to fulfill its responsibilities to protect buyers of new homes," said Thompson. "It is why we are rebuilding the program from the ground up, focusing on consumer protections, transparency and access to information, and governance."