Buying a new home is a life-changing decision. While it’s often exciting, it can also be stressful, as it’s one of the biggest purchases most people will ever make. Getting the right information early on can help ease worries and simplify the process.
Here are three essential questions to ask when purchasing a pre-construction home or a newly built home within the last seven years.
1. What should I consider before choosing a builder?
First and foremost, verify the builder’s licensing status. In Ontario, it’s illegal to build or sell a new home without a licence from the HCRA. Licensing helps give confidence that the builder meets professional standards and has the competencies required to construct a home. Licensed builders are also expected to uphold the HCRA’s Code of Conduct, supporting ethical behavior and a positive home-buying experience.
You can easily verify a builder’s licensing status through the Ontario Builder Directory, where you can also review their history, experience, and past projects. This initial step is crucial in selecting a reputable builder. If the builder is unlicensed or if you have concerns about their professionalism or past conduct, it’s best to walk away. This transaction is too important to take risks—make sure you’re working with a builder you trust. Their licence, and the standards it upholds, should be your first checkmark.
2. What if there’s a delay or additional costs not mentioned in my sales agreement?
An Agreement of Purchase and Sale (APS) is a legal contract. Builders are required to follow the terms of their contracts, including how and when changes can be made. Being well-informed will help you navigate any potential changes smoothly. Clarifying these details upfront will manage expectations and avoid unwelcome surprises during the building process.
It is always advisable to have your APS reviewed by an expert – such as a real estate lawyer – to ensure you understand the provisions regarding potential price increases and delays.
Unexpected costs can arise, and the specifics of the APS will outline how these situations are managed. For instance, the contract may detail conditions that could lead to added costs or project delays. Your builder is responsible for informing you of any potential changes and explaining their necessity. Remember, if a term or condition isn’t in the contract, you aren’t obligated to agree to it.
3. What expectations should I have from my licensed builder?
By law, all new homes built in Ontario come with a builder’s warranty lasting up to seven years. In addition to this warranty, you should expect a level of professionalism from your builder that inspires trust and confidence. These expectations are outlined in a legislated Code of Ethics, which the HCRA enforces to address professional conduct complaints against licensed builders.
Violating the Code can lead to various actions from the HCRA, such as requiring training and education courses, issuing fines, laying provincial offences charges, or even suspending or fully revoking a licence.
The Code also makes it clear that there is zero tolerance for intimidation, coercion, or harassment during the home-buying process. Builders are not allowed to prevent anyone from making a complaint to the HCRA. If you believe a builder or seller has violated their ethical responsibilities, contact the HCRA immediately by filing a complaint.
Make an informed decision
As you consider a new home purchase, taking the time to ask these questions can help you feel confident in your decision. For additional guidance and a comprehensive overview of the home-buying journey, visit the HCRA’s New Home Buyer Dashboard. This resource is designed to empower you with the information you need to navigate the process smoothly and protect your investment in your new home.
Remember, a well-informed buyer is a confident buyer, so take advantage of the tools and resources available to you!