Value Engineering in Custom Homes: Value Engineering in Custom Homes

Value Engineering in Custom Homes: Value Engineering in Custom Homes: Value Engineering can be defined as a conscious and clear set of disciplined procedures,  designed to look for optimum value for both initia...

Whether the Home renovations is covered in the Tarion warranty?

A common question asked by the homeowner at the start of  their home improvement project is either these renovations/ additions/ remodeling is covered by the Tarion warranty program?

So the question is whether the Tarion warranty program applies on existing home improvement project?, Simple answer is no. Tarion is a private corporation, to regulate new home builders and protect the rights of new home buyers.  Tarion administers the Ontario New Home Warranties Plan Act, in which new homeowners are entitled to in Ontario that sets out the warranty protection.  Tarion's mandate is as below:

• Licence new home builders and vendors;
• Ensure builders and vendors abide by the Ontario New Home Warranties Plan Act;
• To educate new home buyers about their warranty rights;
• Protect consumers when builders fail to fulfil their warranty obligations;
• Resolve disputes about warranty coverage;
• Investigate illegal building activity;
• Promote high standards of new home construction.

This mandate clearly describes that Tarion program is only for specific new home and not for existing residential projects. So what types of residential homes project would not be covered by the Tarion warranty program.

1.     Condominium Conversions

 A condo conversion means an existing building, usually a commercial office building or former apartment building that has been changed into condominium units. Since conversion projects are not entirely new dwellings and only the status of the project is changed into condominiums, so they are not covered by the statutory warranties.

2.     Renovated Homes

Renovated homes mean that an existing residential home has basically been renovated. Here we have the examples of home additions, major home renovations, complete home remodeling, home restorations into original, entire basement renovations, fresh kitchen renovations or bathroom renovations. In other mean the home was not new and so it would not be eligible for the statutory warranty coverage.

3.     Previously Occupied Homes

If the house was in use of the builder or rented out by the builder/ vendor,  it is not covered under the Tarion warranty program. The statutory warranties apply to new homes only and accordingly. As a result do not apply to homes that have been beforehand occupied by the builder/ vendor or rented out by the builder/ vendor. And also in use of any other persons before being sold to a buyer.

4.     Owner Built Homes

There is no Tarion warranty on a home that is built by a person on land that he/ she owns. A home where the owner or a person on behalf of the owner exercises significant control over the construction of all or part of the home, the owner or his/her tenant, then resides in the home is not falling under the warranty program.

Exercising control over construction includes the trades, suppliers, contracting directly the project, terminating contracts with or directly paying subcontractors, and/or reviewing, revising, approving, supervising or directing work or materials.

Whether the control exercised by the owner is significant depends on the nature, value and quantity of the work or materials controlled or contributed by the owner.  For example, controlling the construction of one or more of the vital elements of the home which are the footings/ foundation of the home, framing, exterior cladding/ stone/ stucco, building envelope That include the HVAC/  heating, electrical, plumbing distribution systems and insulation, may be significant enough to make the home an owner built home. 
Owner built homes by themselves are not covered under the statutory warranties.  It is pertinent that if the owner sells the home without first legitimately residing in the home, it is not an owner built home and the home is entitled to statutory warranty coverage. 

5.     Homes Built on Existing Foundations

A footing/ foundation is defined as an arrangement of various foundation units through which the loads from a building are transferred to supporting soil or rock. A foundation unit refers to any one of the structural parts of a permanent foundation, such as footings, foundation walls, block, piers and pier type foundations constructed of cement products such as concrete, concrete block, wood or any other approved material in the building code.

A foundation does not include non-load bearing partition walls, weeping tiles, damp proofing, waterproofing, and plaster/ mortar parging or encompass load bearing structures that form part of the above ground construction such as columns, beams, posts and above ground load bearing walls.

If part of the foundation of a home is preexisting and the preexisting portion exceeds 40% of the footings as determined by linear measurement footprint, the home will not have statutory warranty coverage by Tarion.

6.     Seasonal Homes

A seasonal home is a home that does not meet the year round occupancy requirements and therefore not built for year round use. Another concern, such as seasonal use of the home or lack of year round access, do not determine whether a home is seasonal for the purposes of the Ontario New Home Warranties Plan Act. So the seasonal homes are excluded from statutory warranty coverage by Tarion.

7.     Some Common Elements

The common elements of a vacant land condominium corporation or a common elements condominium corporation do not  have statutory warranty coverage.  However, common elements of a standard residential condominium project have statutory warranty coverage.

So the statutory warranty coverage has not applied in the above residential construction.  For more information, please call Mayfair home @ 416-949-5050 or visit us at http://www.mayfairhomes.ca

Or visit Tarion at http://www.tarion.com/Warranty-Protection/Warranty-Coverage/Pages/Types-of-Homes-Not-Covered.aspx and  Ontario New Home Warranties Plan Act http://www.canlii.org/en/on/laws/stat/rso-1990-c-o31/latest/rso-1990-c-o31.html