Protecting new home buyers against builders’ errors

June 22 2014 by Ellen Roseman

You get a manufacturer’s warranty when buying an electrical appliance, such as a toaster, and you can purchase an extended warranty from the retailer. All this for a product that costs as little as $30 to $50.

So, when you buy a newly-built house or condo that costs $150,000 to $1+ million, you assume you will receive as much protection as when you buy an appliance.

But there’s a group of dissatisfied homeowners who write to me almost daily, complaining about problems they have experienced with Tarion Warranty Corp.

Tarion was set up by the Ontario government in 1976 to administer a statutory warranty for homes built by registered builders.

Burned buyers want to see the Ontario government set up an independent value-for-money audit of Tarion’s operations. Here is what they say:

Tarion is too close to the builders it’s supposed to regulate and doesn’t have a clear consumer mandate.

When consumers try to appeal Tarion’s decisions at a tribunal, they often find Tarion sends its own lawyers to testify against them.

Tarion has a monopoly on home warranties. It reports to the Ontario consumer ministry, but it can’t be investigated by the Auditor General or the Ontario Ombudsman.

Last week, I did a Toronto Star column about being invited to a media breakfast at Tarion’s office to be told of a major repair (more than $5 million) done to 23 homes that had cracked foundations as a result of land settling and sinking.

Some Tarion dissidents wanted to comment on this story, but didn’t get a chance because the Star closed off comments quickly. They can do so here.

P.S. Here’s an update on my blog post about hiring a roofer. After getting four or five estimates, I hired a company that a reader recommended.

The work took several weeks because of rain delays and cost more than $10,000. They removed several layers of flat roof installed in the past, making my roof six inches lower than my neighbour’s on the other side.

It’s not an easy process to manage and it’s not finished yet. My neighbour found a spot the roofers had missed, which was visible from his back yard. They’re coming back tomorrow to finish the job.