The HCRA’s Role in Licensing
About the HCRA
The Home Construction Regulatory Authority (HCRA) licenses the people and companies who build and sell new homes in Ontario. The HCRA enforces high professional standards for competence and conduct, supporting and promoting a fair marketplace. In this role, the HCRA will give new home buyers confidence when making one of the biggest purchases of their lives - a new home. The HCRA also provides educational information and tools for consumers, including the Ontario Builder Directory, the official source of information about Ontario’s 6,500+ licensed builders and vendors.
About Tarion
Tarion administers Ontario’s new home warranty and protection program, backstopping the statutory warranty coverage provided to purchasers of new homes. Almost every new home in the province is covered by a new home warranty. Tarion’s role includes investigating new home owner warranty claims, resolving warranty disputes between new home owners and builders, and managing the Guarantee Fund, an important financial reserve to help protect Ontario consumers.
Tarion was previously responsible for registering Ontario’s new home builders and vendors. On February 1, 2021, the registration function moved to the HCRA and was replaced by licensing. The HCRA is responsible for licensing and regulating new home builders and vendors, while Tarion will continue to provide warranty protection for homeowners.
To learn more about the HCRA’s role see:
HCRA's Role
Who is required to be licensed as a builder or vendor?
All builders and vendors of new homes must hold a valid licence with the HCRA.
- A builder of new homes must be licensed as a builder
- A vendor of new homes must be licensed as a vendor
- A builder who builds and sells new homes must be licensed as a builder/vendor
- A builder who builds contract or custom homes on land owned by the owner of the home, must be licensed as a vendor and builder
A person planning to build their own home may be an owner-builder and may not need to be licensed as a builder provided that they do not sell the home once they have completed construction. (When in doubt, please contact the HCRA. If a person who plans to have a builder build their home for them, they should confirm the builder is licensed by the HCRA and that their new home is enrolled with Tarion prior to signing a contract.)
Fees
Licensing Fees
| Type of Fee | Rate | Description |
|---|---|---|
| New Licence – Umbrella | $750 | This is a one-time, new licence fee for those applying as part of an umbrella group. Applying as part of an umbrella group means that the applicant shares at least one common principal, director, officer, or partner with another licensed vendor/builder. |
| New Licence – Non-Umbrella | $3,000 | This is a one-time, new licence fee for a new applicant with no corporate history as a licensee. |
| Renewal | $500 | This is the annual fee every licensee must pay to maintain their licence. The renewal fee is paid each year through the licence renewal process. |
| Fast-Track Renewal | $300 | This is the annual fee for a licensee the HCRA has qualified for the fast-track renewal process. |
| Late Renewal (in addition to renewal fee) | $600 | This is the penalty fee for submitting a late renewal application. |
Fast-Track eligibility is determined based on the HCRA’s risk-based criteria. Our assessment includes factors such as competency, financial responsibility and conduct information, as well your compliance with warranty and other obligations. Fast-Track eligibility is reviewed and assessed on a yearly basis upon the submission of the renewal form.
Note:
Per Home
| Type of Fee | Rate | Description |
|---|---|---|
| HCRA Regulatory Oversight Fee (per home) | $145 | Collected on a per-home basis. This fee is also subject to HST. |
Common Definitions
What is a New Home?
A new home is a self-contained single-family dwelling. The home can be detached, semi-detached, a townhome or a rowhouse. It can also be a unit in a duplex or high-rise condominium if the unit is a self-contained, single-family unit.
A new home may be a home in a new subdivision, or one constructed on a vacant or cleared lot. For purposes of the New Home Construction Licensing Act (NHCLA) and the Ontario New Home Warranties Plan Act (ONHWPA) a new home does not include a home that is built for occupancy for temporary periods and does not include a home that is built for seasonal purposes. A home built for seasonal purposes is one that does not meet the year-round occupancy requirements of Part 9 of the Ontario Building Code Act.
A "home" is additionally defined by the type of ownership which can be either a freehold home (i.e. the home and the land are owned outright), or a condominium unit where the individual unit is owned. A home that is a condominium unit (low-rise or high-rise) includes the common elements.
'Home' GuideWho is a Builder?
A builder must be a licensed person or company who will build a home not previously occupied (a new home). It is the builder who performs the work including the supply of materials necessary to construct and warranty a completed home. This may include a project manager depending on the level of control over the project, determined by the contract or evidenced in the completed home.
A builder may be responsible for both building and selling a new home. A builder may also build a new home under an agreement with a vendor or under an agreement with a landowner.
'Builder' Guide
Who is a Vendor?
A vendor must be a licensed person or company who will sell a home not previously occupied (a new home). It is the vendor who sells and transfers title of the new home to a purchaser.
For a new home that is not a home built under contract with a landowner, a vendor must have an agreement with, or otherwise employ a licensed builder in the construction of the new home.
'Vendor' GuideWho is a Vendor/Builder?
A vendor/builder must be a licensed person or company who will both build and sell a home not previously occupied (a new home). As a result, the person must be licensed as both a builder and a vendor.
The builder of a home built under contract with a landowner (a contract home) is deemed to be a vendor. Consequently, the builder will also be the vendor for purposes of statutory warranty.
Who is an Owner?
An owner, for purposes of the NHCLA and the ONHWPA is a person who first acquires a new home for occupancy from its vendor. If the home is sold or transferred during the statutory warranty period, a successor in title is the owner for purposes of the statutory warranty. Most new homes built in Ontario will be covered by the ONHWPA warranty that is backed by Tarion and the first owner and successors in title will benefit from the warranty.
'Owner' GuideWho is an Owner-Builder?
An owner-builder is an individual who is building a home for their own use, on land they own. An owner-built home is not eligible for warranty coverage under the Ontario New Home Warranties Plan Act and will not have statutory warranty coverage under the Act.
As an owner-builder, the individual takes on the role of a builder. This means the individual will be in control of the project and will be ultimately responsible for the project. For example, an owner-builder will be responsible for obtaining and managing aspects such as workplace safety and insurance, obtaining the necessary municipal permits for different stages of construction, and selecting and contracting directly with subcontractors, trades and suppliers. Where an owner-builder is in control of their own project, they may utilize or otherwise employ a construction manager to assist them and provide additional expertise or experience.