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New Provincial Legislation Sees All New Alberta Homes Covered By Warranty

EDMONTON As of February 1, 2014 new legislation has been created in Alberta under the New Home Buyer Protection Act that will require all new home construction in Alberta have mandatory warranty coverage. This applies to all forms of homes including single family, condo, multi-family units, modular, manufactured, cottages and renovations where 75 per cent of the enclosed space of a home above the foundation is new. This new legislation is another step in protecting a person’s most valuable asset and while members of the CHBA have been providing warranty in Alberta since 1974, this positive change will see all builders held to the same standard.
There is however an exemption for owner built homes. An individual my build their own home for the purpose of living in it and have the option to apply for an exemption that will require owners to adhere to strict rules such as not selling the home for 10 years. However, in the event the home does need to go on the market before 10 years, owners will be required to purchase warranty for the remainder of the 10-year period.
The warranty will cover materials and labour for a year; delivery and distribution systems such as electrical, gas, plumbing and heating for two years; defects to the building envelope for five years with an option to purchase two additional years; and structural defects for 10 years. Although warranty covers many things, the homeowner has a duty to mitigate damages by reporting problems in a “reasonable” time, notifying the warranty provider and taking “reasonable” steps to prevent more damage. Most warranty issues relate to minor defects. The most expensive claims are structural and building envelope problems. These are rare and even then can be repaired for well under the limits of $265,000 for a single-family home and $130,000 on a multi-family unit.
All builders will be required to enter their homes into a registry that will be used to track warranty prior to permits being issued and will also allow consumers to check the warranty status and coverage before purchasing a home.
More information on the New Home Buyer Protection Act can be found at homewarranty.alberta.ca


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