New Home Problems and Warranties

Problems in your new home – get mad or get even?

You're in the house of your dreams at last... and then it turns out to be the house of your nightmares. You move in and find out the next day or the next month, or the next year – that the paint is chipping off the walls, or the hall tiles are cracked, or the roof leaks or the pipes leak, or there's water in the basement, or cracks in the foundation, or... the list could go on and on.

It's our sad duty to inform you that the general rule in law is that when you become the owner of the house you become the owner of the problems too, and it's up to you to fix them and pay for them. So getting mad is more often the option than getting even. But there are some exceptions to the rule.

If you bought this House from Hell directly from the builder, start by complaining to the builder. If these are problems you brought to the builder's attention in your pre-closing inspection of the house, the builder is supposed to fix them within a short time after the closing. Some builders are better about this than others, so it's wise to check out the builder's reputation before signing the agreement of purchase and sale.

After closing, in Ontario a newly-constructed house comes under the provincial new home warranty program. The warranty covers things like major structural defects, defects in work and materials, water seepage through the foundations, defects in the electrical, plumbing, and heating systems, and violations of the provincial building code.

One to Seven Year Warranty

The warranty period lasts from one to seven years, depending on the nature of the problem. Write to the new home warranty program about the problem, and copy your letter to the builder.

The warranty goes with the house, not the original buyer, so if you buy a recently-built resale home and find problems, you may be able to make a claim under the warranty.

If you buy a resale home that is not under warranty, you're mostly out of luck. The one exception is if the vendor deliberately concealed problems from you – for example, if the vendor knew she had leaky pipes and just wallpapered over the evidence of the leak and never said a word to you. If that's the case, you may be able to sue the vendor. But if the problem was obvious when you signed the agreement of purchase and sale, you agreed to buy the house including the problem. So if the vendor knew there was a leaky pipe and didn't mention it, but there were signs of leakage on the wall or ceiling, you probably wouldn't get far with a lawsuit.

Lawsuits are expensive and time-consuming and emotionally draining – and you can't be sure that you'll win. That's why it's important to have a resale house professionally inspected before you buy. A good home inspector should find out most of the serious problems in a house, even if the vendor has tried to hide them.