New Homes built by Licensed Residential Builders in the Kelowna area must be covered by third party home warranty insurance...
Minimum coverage 2-5-10 Warranty...
At a minimum, home warranty insurance coverage includes:
-2 years on labour and materials (some limits apply)
-5 years on the building envelope, including water penetration
-10 years on the structure of the home
-2 years on labour and materials (some limits apply)
-5 years on the building envelope, including water penetration
-10 years on the structure of the home
The two-year labour and materials coverage covers any defect in labour and materials for:
-12 months on detached homes and on non-common property in strata units (including fee simple homes)
-15 months on the common property of strata buildings
-24 months on all new buildings for defects when related to delivery and distribution systems; defects related to the exterior cladding, caulking, windows or doors that may lead to detachment or material damage to the new home; coverage for violations of the Building Code that constitute a health or safety risk or is likely to result in damage to the new home; and defects which render the home unfit to live in.
-15 months on the common property of strata buildings
-24 months on all new buildings for defects when related to delivery and distribution systems; defects related to the exterior cladding, caulking, windows or doors that may lead to detachment or material damage to the new home; coverage for violations of the Building Code that constitute a health or safety risk or is likely to result in damage to the new home; and defects which render the home unfit to live in.
Minimum coverage for third-party home warranty insurance is set by legislation.
As a minimum, homes built by Licensed Residential Builders must have 2-5-10 Year Home Warranty Insurance. Some new homes have warranty insurance coverage that exceeds the minimum requirement. You should carefully review your home warranty insurance policy documents which will provide specific details on the home warranty insurance coverage on your home.
The warranty is attached to the home, not to the owner of the home, and remains in effect upon the re-sale of the home until the coverage expires.
Strata-titled homes have two policies of home warranty insurance: one on the home and the other on the common property. Sometimes when the coverage of a new strata-titled home starts, the coverage on the related common property has already started — or expired. Coverage on the common property of strata-titled buildings starts when the first unit in the building is occupied or sold.
Owner builder exemptions
The most common exemption from the licensing and home warranty insurance requirements is a new home built under an Owner Builder Authorization.
Unless home warranty insurance is provided, owner-built homes are subject to the 10-year Statutory Protection provisions of the Act. These provisions hold the owner builder personally responsible to subsequent purchasers for any defects in labour, materials or design for 10 years after first occupancy.
If you buy such a home and find defects, you must contact the owner builder directly. Any action to remedy defects by a purchaser must be started within the 10-year period.
Further exemptions
The Act and Regulation also exempt the following classes of new homes from the requirements for home warranty insurance, registration fees, reconstruction fees and builder licensing:
The warranty is attached to the home, not to the owner of the home, and remains in effect upon the re-sale of the home until the coverage expires.
Strata-titled homes have two policies of home warranty insurance: one on the home and the other on the common property. Sometimes when the coverage of a new strata-titled home starts, the coverage on the related common property has already started — or expired. Coverage on the common property of strata-titled buildings starts when the first unit in the building is occupied or sold.
Owner builder exemptions
The most common exemption from the licensing and home warranty insurance requirements is a new home built under an Owner Builder Authorization.
Unless home warranty insurance is provided, owner-built homes are subject to the 10-year Statutory Protection provisions of the Act. These provisions hold the owner builder personally responsible to subsequent purchasers for any defects in labour, materials or design for 10 years after first occupancy.
If you buy such a home and find defects, you must contact the owner builder directly. Any action to remedy defects by a purchaser must be started within the 10-year period.
Further exemptions
The Act and Regulation also exempt the following classes of new homes from the requirements for home warranty insurance, registration fees, reconstruction fees and builder licensing:
-Manufactured homes, including mobile homes (CSA-Z240) and factory-built homes (CAN/CSA-A277)
-Hotels and motels
-Dormitories
-Care facilities
-Floating homes
However, if any of the above (excepting manufactured homes) are strata-titled, they are deemed to be new homes and require home warranty insurance, registration fees and reconstruction fees (where geographically applicable).
The Act and Regulation exempt the following classes of “new homes” from the requirement for licensing, home warranty insurance, registration fees and reconstruction fees:
-Multi-unit buildings owned under a single title and constructed for rental purposes
-Multi-unit buildings that are strata-titled, but held under single ownership and constructed for rental purposes
-Three or more dwelling units built for rental purposes and owned under a single legal title
In these cases, the owner must provide a restrictive covenant that is registered on the title restricting the sale of any dwelling unit for a 10-year period. More information can be found in the Rental Exemption section of our website.
New homes on First Nations lands
Homes built on First Nations reserve lands are also excluded from the requirements of the Homeowner Protection Act and are not required to be built by a Licensed Residential Builder and have 2-5-10 year home warranty insurance coverage. It's important to note that homes built on Treaty First Nations lands are not exempt from these requirements and do require licensing and home warranty insurance coverage. While licensing and home warranty insurance are not required for homes built on reserve lands, builders constructing homes on reserve lands may voluntarily become licensed or offer home warranty insurance for the homes they build. If a new home is voluntarily enrolled in home warranty insurance coverage, the coverage provided must meet the minimum requirements of the Act and Regulations; it is exactly the same coverage as the mandatory 2-5-10 year home warranty insurance coverage.
-Hotels and motels
-Dormitories
-Care facilities
-Floating homes
However, if any of the above (excepting manufactured homes) are strata-titled, they are deemed to be new homes and require home warranty insurance, registration fees and reconstruction fees (where geographically applicable).
The Act and Regulation exempt the following classes of “new homes” from the requirement for licensing, home warranty insurance, registration fees and reconstruction fees:
-Multi-unit buildings owned under a single title and constructed for rental purposes
-Multi-unit buildings that are strata-titled, but held under single ownership and constructed for rental purposes
-Three or more dwelling units built for rental purposes and owned under a single legal title
In these cases, the owner must provide a restrictive covenant that is registered on the title restricting the sale of any dwelling unit for a 10-year period. More information can be found in the Rental Exemption section of our website.
New homes on First Nations lands
Homes built on First Nations reserve lands are also excluded from the requirements of the Homeowner Protection Act and are not required to be built by a Licensed Residential Builder and have 2-5-10 year home warranty insurance coverage. It's important to note that homes built on Treaty First Nations lands are not exempt from these requirements and do require licensing and home warranty insurance coverage. While licensing and home warranty insurance are not required for homes built on reserve lands, builders constructing homes on reserve lands may voluntarily become licensed or offer home warranty insurance for the homes they build. If a new home is voluntarily enrolled in home warranty insurance coverage, the coverage provided must meet the minimum requirements of the Act and Regulations; it is exactly the same coverage as the mandatory 2-5-10 year home warranty insurance coverage.
Definitions:
A residential builder must obtain a licence from BC Housing before starting construction on a new project. That licence must be maintained until such time that all new homes enrolled in home warranty insurance have been completed or, in the case of a developer, sold.
Source: BC Housing
Source: BC Housing
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*** This article contributed by Donna Fuller and may not be copied or reproduced in while or in part without the full written consent of the contributor***