New legislation announced Thursday will offer new home buyers in Alberta more protection and the province says it's designed to be the strongest warranty of its kind in Canada.
Bill 5, the New Home Buyer Protection Act, requires builders to provide home warranty coverage for all new homes built in the province starting fall 2013.
“If things go wrong, this legislation gives stronger protection to get those homes repaired,” said Municipal Affairs Minister Doug Griffiths.
“The fact that most of us, the largest purchase we ever make is on a home, most of us could not afford to purchase a home and walk away from it so it’s critically important that we have those protections in place.”
Griffiths admits homebuyers needed increased protection because of shoddy construction and pointed to the problems facing owners of the Penhorhood Condos in Fort McMurray, who found themselves homeless after engineers found evidence of serious deterioration in the complexes.
Current warranty offers one year on materials and labour and five years on major structural components.
Under the proposed legislation, all new homes (detached homes and condominiums) would at minimum, include a warranty for:
- One year labour and materials
- Two years for defects in labour and materials related to delivery and distribution systems
- Five years building envelope protection, with a requirement for the warranty provider to offer the consumer the option to purchase additional years of coverage
- 10 years coverage for major structural components
“This is the strongest warranty protection in all of Canada,” Griffiths said.
It’s expected the new home warranty would cost about $1,700 to $2,000 for an average home, or less than one per cent of the cost of the average house.
Owner-builders will be exempt from the requirements to carry a new home warranty unless the property is sold within the warranty period. If the home is sold within the warranty period, the owner-builder must provide the buyer with warranty coverage for the remaining portion of the warranty period.
But the minister says it’s not just about warranties.
He says the goal is to raise the quality of construction of homes as well.
“This is to deal with the few people who won’t or don’t (do a good job),” he said.
Yvonne Byer moved into her new home four years ago and says she had a bad builder.
“One thing this legislation will do is hopefully get rid of the bad builders,” Byer said.
“We fought to get installation into our homes and we had to have three rounds blown in.”
Byer and others in her community banded together to urge the province to improve protection for new home owners.
“This should have been done years ago,” she said.
With files from Susan Amerongen