Tarion Warranty Coverage After Possession

When you purchase a newly constructed freehold home or condominium unit in Ontario, warranty coverage begins as soon as you take possession. This post breaks down what’s covered in the 1-year, 2-year, and 7-year periods, plus key extras and common exclusions.

1 Year Coverage

One-Year Warranty

Starts on the date you take possession and lasts for one year. Coverage includes:

  • Defects in workmanship and materials
  • Unauthorized substitutions of materials
  • Ontario Building Code violations
  • Ensuring the home is suitable for habitation
2 Year Coverage

Two-Year Warranty

Begins on the possession date and covers water penetration and key system defects, including:

  • Water penetration through basement or foundation walls
  • Envelope defects causing water penetration
  • Exterior cladding defects (brick, siding) leading to detachment, displacement, deterioration
  • Electrical, plumbing, heating delivery and distribution system defects
  • Building Code violations impacting health and safety
7 Year Coverage

Seven-Year Major Structural Defect (MSD)

Protects against major structural defects from possession until the 7th anniversary, including:

  • Failure of load-bearing structural elements
  • Significant impairment of a load-bearing element’s ability to support normal loads
  • Substantial damage from soil movement and major basement wall cracks
  • Chemical failures of materials and environmental hazards (example: excessive radon levels)
  • Collapse or severe distortion of joints or roof structure

Additional Coverage: Extended Warranty for Missing Items

If certain items are missing when you take possession, your builder must extend the warranty for those items. The extended coverage applies to items completely absent on the possession date.

When it starts On the date the missing item is installed.
How long it lasts One year or more, depending on the new home warranty duration.
Important You must report missing items to Tarion using a warranty form within the first year of possession.

Temporary Relocation Allowance

If your home becomes uninhabitable due to a warranted issue, you may receive a Temporary Relocation Allowance for expenses like accommodation, food, or storage.

Allowance amount Up to $150 per day, maximum $15,000.
Examples when it may apply Kitchen unusable, all toilets and/or showers unusable, unsafe stairs to upper floor, compromised structural integrity, toxic mold or harmful substance.
Items Not Covered by the Warranty Click to expand
  • Defects in materials, design, and work provided by the homeowner
  • Secondary damage from warranty-covered defects (property damage, personal injury)
  • Normal wear and tear
  • Natural shrinkage of materials due to drying
  • Dampness or condensation due to inadequate ventilation
  • Damage caused by the homeowner or visitors
  • Alterations, deletions, or additions made by the homeowner
  • Settlement of land around the building, except under the building’s footings
  • Contractual warranties outside the Ontario New Home Warranties Plan Act
  • Damage from insects or rodents unless construction does not meet Ontario Building Code specs
  • Damage from municipal services or other utilities
  • Surface defects accepted in writing by the homeowner at possession

For detailed information on exclusions and eligibility, refer to the Home Construction Regulatory Authority advisory.