TORONTO, ON – Tarrion announced yesterday that it would enforce new mandatory disclosures for new home sales, aimed at educating and informing buyers to help them make more informed purchases.
The regulator of Ontario’s new home building industry said that, effective January 1, 2020, every purchase agreement for a new condominium must include an information sheet outlining potential risks for buyers. The information sheet focuses on the potential cancellations, delays and other issues that can affect buyers of pre-construction condominium units.
A sample of the new information sheet was revealed at the time of the announcement and it is titled Information for buyers of pre-construction condominium homes about the possible termination of purchase agreement. The sheet has ten different sections, highlighting:
- The possibility that a project may never be completed
- The proposed completion date and the fact that it may be extended
- That your purchase agreement contains early termination conditions which could result in your purchase being terminated
- That the vendor has “the power to compel transfer of the freehold ownership interest in the Property before closing”
- If there are any title restrictions and, if so, what they are
- Whether zoning approval has been obtained
- Whether construction has begun and, if not, when it is expected to begin
- That legal advice is important and you should “seek advice form a lawyer with respect to the purchase agreement.”
According to the announcement by Tarion, this information sheet must be included with all purchase agreements for new condominium units for any purchase agreement signed after January 1, 2020. That means we are likely to see more informed buyers in the new year, with potential risks laid out clearly for all purchasers.
In addition to the news about the new information sheet, Tarion also announced changes to its Ontario Builder Directory. The tool now allows buyers to search for information about condominium projects, including important details like the project status, number of units. The directory also allows users to find information about developers, including details of cancelled projects and whether the developer has been convicted by the Ontario New Home Warranties Plan Act, which is administered by Tarion.
Highlighting the reasons behind the new changes, Tarion’s President and CEO, Howard Bogach, said: “The purchase of a new home is often the most important one that many Ontarians will make… At Tarion, we’re doing our part to ensure that these purchases are guided by a thorough understanding of the risks, builder history, and status of a given project. The initiatives that we’re announcing today will contribute to a better-informed purchasing process.”