Current Home Warranty

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2 Current Home Warranty There are 4 private warranty providers in Alberta Warranty is not mandatory, although most homes are covered by warranty The coverage that is currently provided is: 1 year on labour and materials, delivery and distribution systems and building envelope 5 years on major structural, with an option to increase to 10 years.

3 Current Status New Home Buyer Protection Act introduced October 25, 2012 and passed First Reading. Passed Second Reading, October 31, Passed Committee of the Whole November 6, 2012 All proposed amendments were defeated Passed Third Reading November 21, 2012 Proclaimed December 5, 2013 Proposed in force date Fall 2013

4 Objectives Improve the standard of building in Alberta Improve consumer protection and recourse options

5 Summary of NHBPA A permit may not be issued unless warranty coverage or an exemption/authorization is in place. Mandatory Minimum Coverage 1 year on labour and materials, 2 years for defects in labour and materials related to delivery and distribution systems, 5 years on building envelope, with requirement to offer additional two years, and 10 years major structural.

6 Start Dates The Warranty start date for new single family homes and unit property in condominiums is determined by: The date an accredited agency, accredited municipality or accredited regional services commission grants permission to occupy the new home, and The date that the transfer of title to the new home is registered. The Warranty start date for common property in condominiums is determined by: The date a building assessment report (BAR) is completed as prescribed. Consultation on details, currently developing regulations

7 Owner Builder Coverage Apply for owner builder authorization If the home is sold within the 10 year period, the remainder would need to be purchased Consulted on issues such as how long one must intend to live in the home, and Frequency of authorizations.

8 Registrar, Compliance Registrar will establish a publicly accessible registry (warranty tracking system). Sets the Registration fee ($95) The Registrar will name Compliance Officers Penalties and enforcement Administrative penalties of up to $100,000 can be enforced Offenses under the Act can result in a charge of up to $100,000 for first offense and $500,000 for subsequent offenses

9 Regulations Targeted stakeholder consultation ran in fall 2013 Details regarding inclusions and permitted exclusions Building Assessment Reports Owner builder time lines Treatment of modular homes Minimum coverage limits Exclusions Other details in the Act

10 Process Builder registers as a user Builder registers a construction project in registry Identifies company providing warranty coverage Fee paid Before or after application for permit Warranty company provides confirmation that they are covering the project, permit issuer is notified. Permit can be released.

11 Unique Situations De-enrollment Municipal Affairs would be notified and then notify the municipality. No confirmation of warranty Builder would need to obtain confirmation of warranty Permit not issued Reconstruction - 75% of home above grade Municipal Affairs will provide interpretive support

12 Other Municipal Issues NHBPA will apply to any homes for which a permit is applied for after the in force date (Fall 2013) NHBPA does not modify the level of accountability placed on an accredited municipality, the accountability set out in the accreditation agreement and Safety Codes Act remain the same.

13 Other Initiatives Increases to the Fines and Limitations period in the Safety Codes Act. Three year limitation period Fines increased to up to $100,000 for first offense and $500,000 for subsequent offenses. Safety Codes Council is reviewing inspection requirements in QMPs. Building envelope training for building safety codes officers is now mandatory. Public Education Performance Guide