Homes built by Licensed Residential Builders (building permits applied for on or after July 1, 1999)
As of July 1, 1999, builders must be licensed by the Homeowner Protection Office and arrange for third-party home warranty insurance in order to obtain a building permit or commence construction on a new home.
Minimum coverage and allowable exclusions for third-party home warranty insurance are set by legislation. As a minimum, new 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.
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 another on the common property. When the coverage of a new strata-titled home commences, it is possible that the coverage on the related common property has already commenced or expired. Coverage on the common property of strata-titled buildings starts when the first unit in the building is occupied or sold.
Before purchasing the re-sale home, find out if there is any existing home warranty insurance. Enquire about the expiry dates and get it in writing.
Owners of homes that still have remaining home warranty insurance are able to obtain a claims history from the warranty insurance provider at a cost of no more than $25. Potential purchasers of such homes could consider asking the owner to obtain a copy of the claims history to assist the buyer in making a more informed purchasing decision.
Owner-built homes
Some people build new homes as an owner builder. An owner builder is an individual authorized by the Homeowner Protection Office to build a new home for their personal use.
Be aware that an owner-built home is not required to be built by a Licensed Residential Builder and is not required to have home warranty insurance.
As of November 19, 2007, individuals wanting to be an owner builder of a new home are required to obtain an Owner Builder Authorization from the HPO and to pay a fee, prior to commencing construction of that new home. These requirements are in effect for all areas of British Columbia and reflect changes to the Homeowner Protection Act and Regulation to strengthen protection for buyers of new homes.
Owner builders who build and market a home as “new” without having lived in the home themselves first, may have contravened the Homeowner Protection Act.
See Buying or Selling an Owner-Built Home.
Homes built with building permits prior to July 1, 1999
Before July 1, 1999, builders were not required to be licensed by the Homeowner Protection Office or arrange for third-party home warranty insurance in order to obtain a building permit of commence construction on a new home.
Homes with completed building envelope renovations
Since September 30, 2000, repair contractors who perform building envelope renovations must be licensed by the Homeowner Protection Office and provide mandatory, third-party warranty insurance in order to get a building permit for building envelope renovations subject to the Homeowner Protection Act regulations. In geographic areas where building permits are not required for such building envelope renovations, licensing and warranty insurance must be in place prior to the commencement of the building envelope renovations.
These regulations do not apply to the following categories: buildings with only one or two self-contained dwelling units, multi-unit rental buildings, social housing, hotels and motels, dormitories, care facilities, floating homes, repairs carried out by the original builder at no cost to the owner(s) or when there is a cost-sharing agreement between the original builder and the owner(s), buildings covered with Homeowner Protection Act legislated warranty insurance, or when the dollar threshold* and/or the percentage of cladding surface renovated threshold** is/are not met.
* the building envelope renovation cost is greater than or equal to $10,000 or $2,000 per unit in the building
** building envelope renovations in which 60% or more of any cladding surface is renovated
Minimum coverage and standards for warranty insurance covering applicable building envelope renovations are set by regulations, not by warranty providers. This coverage includes 2 years on labour and materials (some limits apply) and 5 years on the building envelope including water penetration (2-5 year warranty insurance).
Between September 30, 2000 and July 28, 2004, homes with building permits for some building envelope renovations which were subject to the Homeowner Protection Act regulations received 2-year stand alone warranty insurance on labour and materials only.
Before purchasing a re-sale home in which building envelope renovations have been performed, find out if there is any existing home warranty insurance on the repair. Enquire about the extent of any existing warranty, the expiry dates and get it in writing.
See the Homebuyers, Homeowners and the Owners of Leaky Homes sections of the site for more information.
