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With new home sales in the GTA continuing to increase, the large
volume of properties at various stages (pre-construction, under
construction and occupied but still under warranty) has created a
huge bulge in the system, presenting challenges to both builders and
buyers.
I'd like to take this opportunity to put the current situation
into perspective, while offering some consumer strategies for new
home purchasers.
The new home market is well into the fourth year of a very strong
recovery following an even longer and extremely deep trough through
the early and mid '90s. But the sustained boom in new home sales has
exposed the constraints within the industry. Our chronic shortage of
skilled workers has been exacerbated by the phenomenal increase in
demand. This has resulted in a proportional increase in complaints
about workmanship and/or the length of time it takes to get
after-sales service, as well as some delays in new home closings or
condominium occupancies.
In reviewing the files we're finding some common issues,
including a general lack of understanding as to how the consumer
protection system works in the new home industry. We are also seeing
poor communication on the part of both builders and the Ontario New
Home Warranty Program.
Since ONHWP doesn't have a Toronto Star column, I will be
devoting a number of articles in the coming months on how the
program licenses builders, the extensive coverage available and an
explanation of how the system works.
The underlying basis of a lot of the letters we receive at GTHBA
is frustration on the part of purchasers who don't know where they
stand because their builder is not communicating with them. Because
of this, I have contacted all of our members encouraging them to set
realistic closing dates, keep talking with buyers throughout the
process and watch carefully to achieve balance between the competing
demands of new construction and after-sales service.
There are a number of things you can do to mitigate potential
problems. If you are a prospective homebuyer, do your homework.
Research the builder. The ONHWP rating system is one way to do this
but don't rely on it exclusively because it is limited to
after-sales service within a defined period and the rating only
reflects the end result of the complaint process.
A sure-fire way to check out your builder is to ask where the
company has built before and visit that site. Ask around among the
homeowners there. You will quickly find out whether buyers are
satisfied.
And always have your agreement of purchase and sale reviewed by a
lawyer before you sign it. If you are a buyer who is awaiting
occupancy of your new home, do not put your current house up for
sale or terminate your lease agreement prematurely. Your builder is
obligated to provide you notice of a delay in closing, but you
should be monitoring the progress of construction yourself. Keep
your options open as long as possible. The rights and
responsibilities of the builder and buyer with respect to delayed
closings will also be the subject of a future Bricks and Sticks.
If you have already moved into your new home, please be as
flexible as possible in granting your builder access to your house
and rest assured that if you have legitimate warranty issues, they
will ultimately be taken care of. The vast majority of new homes are
closing on time with minimal service issues. And those are being
rectified quickly. We're striving to ensure even better performance
levels.
Sheldon Libfeld is president of the Greater Toronto Home
Builders' Association. Fax 416-391-2118, e-mail
GTHBA@newhomes.org |
