Back
New act makes builders play by same rules
Oct 06, 2017

by Todd Lewys

Attention, prospective new home owners: new legislation designed to make your life easier is due to take effect on January 1, 2018.

Called the New Home Warranty Act, the legislation is aimed at providing increased protection for new home owners, said Prabal Ghosh, manager of policy and legislation, Consumer Protection Office, Manitoba Justice.

“This legislation will require most new homes, including manufactured homes, condominiums and cottages, to be covered by a warranty for a minimum of seven years and $100,000.”

While coverage will depend on the terms of the warranty a builder secures, all home warranties will carry the same minimum coverage.

“Minimum coverage will include one year for all materials, labour and design, 15 months for the common elements of shared buildings, such as hallways and roofs in condominiums,” said Ghosh. “There will also be two years of coverage on plumbing, electrical, heating and mechanical systems (for HVAC systems), caulking, windows, doors and exterior, including defects resulting in water penetration.”

Last, but certainly not least, there will be seven years worth of coverage on structural defects. It should be noted that the legislation will apply only to new homes.

It won’t cover hotels, motels, lodges and camps, dormitories, and personal-care homes, mobile homes, trailers or rental buildings.

Ghosh said the comprehensive new legislation is being introduced for a simple reason.

“Until now, there’s been no legislative authority to do anything to ensure builders take care of any issues. With the Act, we can force compliance.”

Once the New Homes Warranty Act takes effect, all builders must secure a new home warranty.

“All builders of new homes in Manitoba must arrange for warranty coverage  — usually from a third-party provider — on the homes they build,” said Ghosh. “All builders must also be registered with the Consumer Protection Office.”

There will be immediate consequences if a builder isn’t registered with the Consumer Protection Office.

“The authority having jurisdiction isn’t allowed to issue a building permit for a new home unless the builder has proven they’re registered and that a warranty provider has agreed to supply a warranty for the home they’re planning to build.

“Speak to your builder about the warranty provider they’re using, and the terms and conditions of the warranty.”

Lanny McInnes, president and CEO of the Manitoba Home Builders’ Association (MHBA), said the New Home Warranty Act is a positive development.

“We’ve worked collaboratively with the provincial government on the act,” he said. “It will provide a greater level of confidence for those building a new home. If there’s an issue, it will be dealt with.”

That’s the intent of the legislation, said Ghosh.

“It’s designed to make all builders play by the same rules. If defects are warrantable, they will have to be repaired.”

It should also be noted that members of the public who build a home for themselves will also have to purchase a warranty.

“Owner-builders may choose to purchase new home warranty coverage before they apply for a building permit, but aren’t required to do so by law,” Ghosh said. “However, if they wish to sell their home within seven years of moving in, they will be required to secure warranty coverage for the remainder of the seven years, or obtain permission from the Consumer Protection Office.”

Most importantly, consumers will have a readily-accessible resource available to help them better negotiate the complicated new home building/buying process.

“A free New Home Registry will be available in January 2018. It will provide information on registered builders and the status of new homes built in the province,” he said. “You’ll be able to do address searches, find out who built a home and what warranty coverage is, or how much coverage is left on a home. Our hope

is that it will strengthen consumer protection for new home owners.”

For more information about The New Home Warranty Act, visit Manitoba.ca/new home warranty or contact the Consumer Protection Office at 204-945-3800.