Friday, July 26, 2013

Seize the Day

Seize the day:
Buying sooner pays off as mortgage rates begin their slow but inevitable climb

I can remember when mortgage rates sat at 21%. That was back in 1981. (Of course, I was only an infant at the time. ) Compared with those difficult days, recent news of a mere 0.60% increase in the big banks’ posted rate seems almost cute.

But, while the overall outlook is good for 2013 and 2014, too much complacency can cost you hard-earned dollars.

You don’t have to be a veteran market-watcher to know that Canada has been enjoying historically low mortgage rates: discounted rates have been hovering around 3%. (That’s for a five-year fixed rate mortgage.) Thousands of first-time homebuyers have jumped at the chance to lock into rates like these.

But, from the Governor of the Bank of Canada to the heads of the big banks, financial experts agree that interest rates cannot remain so extraordinarily low. BMO Capital Markets Senior Economist Sal Guatieri has suggested that a “normalized” mortgage would be closer to 4.99%.
Now, over the past few weeks, it seems the big banks have begun the slow but inevitable mortgage rate hike. How might it affect you? Let’s do some simple math:

Let’s say you’re looking at purchasing a $250,000 condominium. As of press time, the posted rate of several of the big banks is 3.69%. Lock in now, and  (assuming 25-year amortization ), you’ll pay $1,273 monthly.

If you wait till rates normalize at 4.99%? You’re looking at $1,452 monthly – that’s  a difference of $179 a month. Over a five year term, you’re losing $10,740. I don’t have to tell you what you could do with that money.

But perhaps more significantly, an higher rate will decrease the amount you’re approved for – by tens of thousands of dollars. Play around with an online mortgage approval calculator: you’ll be amazed. With an income of $64,000 and a down payment of $20,000, today’s mortgage rate will get you approved for $252,000. At 4.99%, that approval suddenly drops to $228,000. That may mean the difference between buying the home you love and settling for one you can afford. 

I’m all for buying the home you love.

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Thursday, July 25, 2013

Which Type of Home Ownership Would You Prefer?

Owning a house is not as easy as it seems. However, by reading our blog and contacting the right real estate agent in Ottawa, you can get the chance to own a home of any style that you want. With a wide variety of homes available, there are bound to be different type of ownership choices. It does not matter what type of home you own, you can choose the ownership depending on your means and requirements.

Among the different ownership types, freehold is the most common. As an owner, you have full access to the land and the structure built on it. You are responsible for all indoor and outdoor maintenance and repair. As the owner of the freehold interest, you have full right to control and use the building and land, subject to any rights of the Crown, local bylaws about land usage and any other terms that were put forward during the purchase.

A condo ownership will allow you ownership of the unit and a shared ownership for the common areas. As a home owner, you will be responsible for the maintenance and repair of the interior of the unit. The condo association will be responsible for everything outside the walls including the common areas and grounds.  The rules for condo are a bit stricter about the use of common area, renovations and noise. The condo association fee covers costs that include common utility bills, taxes and maintenance costs. Though a condo is cheaper than a freehold house, it offers lesser privacy.

Co-ops (co-operatives) are very similar to condos. The difference is that you own a share in a complex or a building instead of owning a unit. If you decide to sell your share, the co-op board has every right to reject your prospective buyer.

You might even opt to get a lease on your property. This gives you the right to use the property for a limited but long period of time. This type of ownership is commonly known as leasehold interest. This type of ownership is available for homes (usually apartments or townhouses) that are built on land that is owned by the city. Usually the contract allows ownership for 99 years. Occasionally, the ownership is made available for detached homes built on First Nation reserves and farm land.

A Strata is another type of ownership that allows you to use and own a particular housing unit which is contained on a larger property. Just like condo ownership, you will have share in the common areas of the property. You can find this type of ownership for different types of properties throughout the city.

Contact your Ottawa real estate agent today and find out which type of ownership and home would best suit your needs given the circumstances.

Monday, July 22, 2013

Mortgage Basics

If you have already had a look at our blog, you surely have seen a couple of posts that explain a few of the most basic mortgage related questions that buyers have. When you look for Ottawa real estate properties, the first and foremost thing you need to do is understand the basics that are involved with buying a mortgage and how the monthly payments are calculated. After this, you get yourself pre-approved for a mortgage. There are few benefits of a pre-approved mortgage that can help you in buying your dream home.

We define mortgage as a loan that is specific for real estate. The loan is provided with one basic condition that if for any reason the borrower is not able to keep up with the timely payments the lender has the right to sell the property so that they can get their money back.

The monthly payments are based on the amortization rate and the time period for which the mortgage loan is issued. These payments are inversely proportional to the amortization time period; the larger the amortization period, the smaller the monthly payment. The time period is usually between 10 to 25 years.

Your mortgage calculations will depend on the amount of the mortgage you qualify for. The pre-approval process can give you a fair idea of the amount that you can avail and the amount you have to pay for down payment. The pre-approval process begins after you provide all the necessary financial documentation to your lending institution. The lender will then check for your credit score with the credit bureaus. It is against this information that the lender will provide you a complete mortgage plan that will include the amortization period, interest rate and the monthly payments that you will have to make.

While many people do not believe in getting pre-approved for a mortgage, we cannot stress its importance enough. Pre-approval will save you many complications that can come once you set your eyes on a particular home. Also, many realtors will not work with you if you are not pre-approved.

The most important reason why you need to be pre-approved for mortgage is that it will give you a clear picture of the type of real estate you can afford. Another reason is that a seller would be more interested in your offer if you have the means to quickly provide the cash.

Therefore before you get yourself pre-approved make sure that you have not provided any false information to the lender. Another reason you might not get pre-approved is if the mortgage inspector values the property to be worth less than the asking price. Thus, when you decide to look for a real estate property in Ottawa make sure that you are pre-approved so that you have a better chance at ownership.
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Thursday, July 18, 2013

How to Invest in U.S Real Estate

The US investment market is still suffering from the consequences of the recession that hit its financial market in 2007. Although the market has picked up quite a bit areas like Nevada, Florida, Arizona, and California, areas that were hit the hardest are still below the replacement value. The Ottawa real estate market is quite different, but as an investor you should try to have a look for an investment opportunity in our neighbouring country.

The Canadian dollar still holds strongly against the U.S dollar. This in turn means that if you invest in US assets, you are likely to get a decent return over time. Taking a close look at these facts suggests that Canadians have an opportunity to invest in the best US real estate. In addition, you will be able to enjoy the summers with your family in the sun and the value of the property is likely to appreciate in the coming years.

It may sound like a dream come true but there are few things that need consideration before you dive into the opportunity. If you are planning to buy property for purely business purposes then you have to consider the following:

Passive Real Estate Investment does not Exist

You will require local knowledge of the area in which the property is located. You want the house to be located in the perfect neighbourhood and you might even let it out on rent while you wait for the value to increase. A local professional will help you manage the property and keep it occupied without any problem.

Mortgage Issues

If you are planning to find leverage or a loan from an American lender then you are in for a surprise. Even with mortgages cheaper than before, it is very difficult for Canadians to qualify for a mortgage therefore you might have to pay for the home in full. Your Ottawa Real Estate agent can look into alternative solutions


Unless you have prior experience and property in the US, you might want to expose yourself to the various US taxes that are involved in the buying and renting of an investment property. Not to mention you will have to file for yearly tax returns. We would highly recommend talking to an account familiar with investing in US properties.

Lack of a Diversified Investment Portfolio can be Disastrous

If you have just one rental estate in the US, you should be ready for all consequences. Deadbeat tenants, uninsured damages and property in the wrong area are all ingredients to a recipe for disaster. It is therefore important that you have more than one type of housing property in the US.

Your Ottawa real estate agent will help you in making the right decision for your real estate investment in the US. They can help you rent, sell and buy homes in the US along with all the help and information you require for mortgage.
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Wednesday, July 17, 2013

Things to Consider When Buying a House

If you have read the previous blogs, you surely understand that it is not easy to buy a house on your own. There are so many things to consider. Here we will discuss a few of the most important things to consider when buying real estate in Ottawa. These things will help you make purchase decisions and you can also appear real estate savvy to your realtor.

The first thing that you have to do is get a pre approval on your mortgage. You might not be aware of the many elements that work together to help you buy your dream home. A pre approved mortgage loan will help you in the process to buy a home. It will also help you understand exactly what price range is available for you. Also, sellers are more likely to prefer you if you have a pre approved mortgage.
Here's a great video to help you off on the right foot:


Your credit rating will play a vital role in your ability to buy a home. It will help in determining the interest rate that you are charged and will also help in determining if you will get approval for the mortgage that you require. It is therefore important that your finances are properly managed and you have a complete understanding of your financial records.

You will also have to search around to see what area or town you would like to live in. You might want to hire an Ottawa real estate agent who will help you through the process if you intend on living in the Ottawa region. The agent will also help you identify sellers who are available in the market and walk you through the budget plan that you have marked.

When you make an offer, make sure that you have gone through all the technicalities and you completely understand what is written in the documents. You will also need to hire a home inspector. You might not be able to understand any architectural issues with the construction until it’s too late. It is therefore important that you have a home inspector go through the house and find if there are any faults in the structure. This will help you during price negotiations and therefore it is imperative.

You will have to study the neighbourhood. Come around at different times of the day to understand if the neighbourhood is ideally located. Is it close to schools? Is the nearby playground a safe place for kids? Are there any offenders in the area?

There is one last thing you need to consider before you sign on the dotted line. The additional costs like property tax, repairs and other such costs need to be considered. You will have to ask your real estate agent to help you understand these additional costs.

Talk to your Ottawa real estate agent and make sure that you consider all the things that are mentioned here before you buy the house. It is after all one of the biggest and most important investments of your life.

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Friday, July 12, 2013

Avoid Homebuyer Traps

It does not matter what type of house you buy, real estate is a major investment and requires a lot of cash. For some buyers the process can be even more costly because they fall prey to costly mistakes and end up paying extra for the home they want or losing it to another buyer, or worst of all buying the wrong house. Your Ottawa real estate agent can help you avoid the different buyer traps that are set so that you can get the house of your dreams.

Blind Bidding

It is important that you study the market before you place a bid. It will help you figure out if the seller is asking the right price or not. Without proper market research you could easily bid a lot for a house or you could bid too low.

Buying the Right Home

As a buyer, it is very easy to be swept away by all the excitement and emotions of buying a new house. You might make a hasty decision and end up with a house that is either too big or small or too far from work. And by the time you realize that you made the wrong decision, it might be too late. Before you go to a real estate agent in Ottawa make a list of the things that you really need in your new home. Follow all the steps that are necessary when you buy a house before you sign on the dotted line.

Clear Ownership

Before you sign the ownership papers make sure that you are the sole owner. You do not want to deal with any tax liens, leases, easements, or undisclosed owners. Have a complete title search before you sign the papers.

Accurate Survey

Make sure that you have a copy of the updated property survey that clearly marks the boundary of your property. If the survey is not updated, you will see that there are structural changes that are not shown. Make sure that you carry out a thorough inspection of the house. By hiring a home inspector you can find the different faults that are present. Remember that the seller is also there to maximize his profit so you need to take all the necessary precautions.

Pre-Approval on Mortgage

Many buyers make the mistake of not getting a preapproved mortgage. A pre-approval on your mortgage helps you shop for a home without worrying if you can afford it or not. It is not only free, but also convenient for you and your real estate agent.

Covered Costs

You need to identify all covered costs. You will be surprised at the number of costs that will come up when you close the transaction. Talk to your real estate agent and ask them about all the hidden costs. Make sure that you see all the paper work before you close the deal.

Your Ottawa real estate agent will help you avoid all these mistakes and many more that you might make unknowingly. Contact Bennett Property Shop today and talk to the best real estate agents in the city.

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Thursday, July 11, 2013

Mistakes Made By Real Estate Investors

You must have heard a lot of people telling what to do when you are investing in real estate. However, people fail to mention what not to do. It is this part that is of utmost importance for Ottawa real estate investors. If you are an investor, you might not be very happy with your current portfolio with the falling market prices. If you want to continue to succeed you have to avoid the mistakes you have already made in the past and also avoid any other mistakes that you can make in the future.

The most common mistake that many investors make is that they are not focused on their investment plan. Either investors do not have a plan or they are easily distracted from the plan when they see new lucrative deals. If you stick to a thought out investment plan that is based on fundamental real estate principles, you will make more money and you will also minimize any risks your investment can face.

Ideally every investor would like to buy property that will grow in value over time; the rental income of the property will exceed the expenses and the equity will continue to grow with tenants paying for your mortgage. If you are buying property just because its value will increase over time, you are taking a huge risk which will most probably result in losses. Your focus should be properties that will generate enough income that you can take care of all expenses related to it and you are able save some profit.

Do not forget to measure all risks and rewards. People are always worried about return on investment. They should also consider the return on risk or return on time. Time is the most precious resource for an investor. The money lost can be regained in some way or the other, but the time lost on a particular investment can never be regained. You should always weigh the risks against the return that an investment is offering. Most investment opportunities that offer big returns come with big risks. If you are not able to manage the risks, you might end up draining your funds.

Another mistake that many real estate investors make is that they try to make the investments on their own. It might seem that you have all the information available on the internet and you can work out the deal on your own, but in reality this is not true. If you think that you are getting good return on your investments and you have managed to take care of them well without involving a real estate agent you are wrong. A real estate agent will help you manage your portfolio and will let you know of all the risks that are involved with your investment.

As a real estate investor it is very important to ensure that you avoid these mistakes. Contact your local Ottawa real estate agent today and save your investments while you still can!
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Wednesday, July 10, 2013

Mistakes to Avoid When Selling a House

Do you have a house in Ottawa that you’re trying to sell? Are you trying to do it on your own or have you hired your relative for the job? In either case, it would be a good idea that you hire a proper real estate agent to sell your house. At Bennett Property Shop we help you avoid the common mistakes that can decrease your profits from the transaction.

It is important that you keep a close eye on the market at all times. You might get good money when you sell the property when the market is strong, but your profits will be used up in buying the new house. If you sell your house when the real estate market is not that strong, you will see that you can get a better price on your house when you add in some renovations and make it appear better in comparison to what the market has to offer. However, it is better to wait for the market to improve.

Your house should be priced according to current market trends, not according to what you think it is worth. If you have over-priced your house even slightly, people will reject it in favour of bigger houses that are available in the same price. At the same time, people who could afford your house at market rate would not even look at it because you have it priced out of their range.

You do not want to be one of those sellers whose house is on the market for a long time. By charging a bit more than the market, you could be delaying sale and in turn ruining your chances of getting full price. If your house is up for sale for more than a month do something! Talk to your real estate agent and review the price, make repairs or add improvements and incentives for buyers. Do not forget to hold an Open House to announce the changes.

Never ask a relative to sell your home under any circumstances. It is possible that you might end up selling it for less and after a prolonged duration. When you hire a real estate agent, do not forget to sign a contract with them with a guarantee of performance.

You should avoid telling exaggerations that would attract buyers but would disappoint them when they see the house. Try to keep a well maintained yard so that buyers are attracted. Keeping the inside of the house clean is a no brainer and something that should be done at all times. Make sure you are done with all the necessary repairs and that everything is squeaky clean.

You should avoid these costly mistakes and hire a good real estate agent in Ottawa to help you sell your house as soon as possible.
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Tuesday, July 9, 2013

Buying Country Property

Whether you are buying a country property for the first time or the tenth, you will realize that there are some differences when you buy a property with features such as a well. Your Ottawa real estate agent will help you understand the different things that you have to check before you have the property transferred to your name.

One important thing that you will need to do is check the Offer to Purchase Agreement drafted by your real estate agent. It is vital that it includes a clause that allows you to test the water supply of the property. This will help in determining if the water is safe for usage and human consumption. Your agent will advise you against buying property in areas surrounding Ottawa that are known to have water problems.

Ground water can easily become contaminated. Different human activities lead to undesirable substances being added to the water. Such substances when left on or under the ground cannot be moved and are added to the water supply through the ground.

Ground water has been proven to cause the spread of the effects of spills and dumps to other regions far beyond the original site of contamination. There are two ways in which ground water can be contaminated: either through point sources or through non-point sources.

Point sources include leaking septic tanks, landfills, accidental spills and leaking gasoline storage tanks. Industrial waste disposal sites and municipal landfills are two of the most significant sources of this type of contamination. Non-point sources include any type of infiltration from farms that are treated with fertilizers and pesticides.

You might also want to test the water supply for a high content of sulphur, salt and iron. Your real estate agent will help you find the best water testing companies in Ottawa. You will also need to test the flow of water that is available for your family’s use.

If the property you are buying has a septic tank, it is again of utmost importance that you have it inspected by a professional engineer who deals with such systems. You might think that the inspection is costly, but it will save you thousands of dollars in replacement or upgrading the system in the future.

You do not have to go about getting the tests and inspections done yourself before purchasing. If you are buying a property that has a septic tank or a well, you can leave all these things to your Ottawa real estate agent. The agent will offer you the best care that is available and will give you details at every step.
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Monday, July 8, 2013

New vs. Used - The Difference is in the System

The first question you will ask yourself when you decide to buy a home is if you should buy a new house or an older one? When you are looking through Ottawa real estate properties, you are bound to get confused. One thought that you may think is that older homes are built better than newer ones. On the other hand, there are also many reasons that may incline you towards choosing a new home over an old one.

Better Built

One thing you should know is that new technology has helped improve the construction process as well as the building material used during construction. Canadian Building Standards have improved drastically over the years. Most new townhouses and detached houses include at least two full bathrooms on the upper storey and a powder room off the entrance hall. Improved kitchen standards and laundry areas have also made the new homes more convenient and acceptable.

The concept of central air-conditioning was not available for condos in the 1970s. Now, however, this has changed. Also, a home office is another essential room that is now available in many new homes that wasn’t available a few years back.

Less Maintenance Required

A new home won’t require much maintenance for at least the first 10 to 15 years. This is usually because the building material used is more advanced and long lasting. The presently used vinyl-clad window frames don’t require frequent repairs unlike older wooden frames. Nor do you have to worry about roof repairs with every change in weather.

If you buy an old home, you will be worried about aluminum wiring and steel or lead plumbing. The brick front also adds to the durability of the new home.

Energy Efficient

Insulation standards have improved in all new homes and the furnaces installed are more energy efficient nowadays. Since 1993, basement insulation has become a common practice and the minimum ceiling heights have also been increased.

The flimsy windows have been replaced with double-glazed casement windows that help keep the cold drafts out and the warmth trapped in. The new Energy Star Program has helped bring down monthly energy costs for home owners.

This new warranty has provided an added protection for new home buyers. It helps with all repairs and corrections that are required during the initial years of the home.

All homes in Ottawa are required to meet safety standards and smoke detectors are to be wired in with the updated electric systems. Older homes will have to replace aluminum wiring, if it has not already been done by the previous home owner.


The newer communities in Ottawa are designed to make sure that parks and playgrounds are within walking distance. Different environmental factors have also been considered during the planning of these communities. There are some builders who specialize in creating small communities where children can grow up without worry.

Even with all these advantages, you will still have to cater to the one most important fact before you buy a house – Location. You will find that most of the best locations in Ottawa already have communities built and the houses that are available are all resale. Therefore, check with your Ottawa real estate agent and find the best house for your family.
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Friday, July 5, 2013

Mortgage FAQs

Once you find your dream home in Ottawa you will need to look at your different mortgage solutions.

Mortgage solutions are provided by many bankers and mortgage brokers in Ottawa and other cities in Canada. Though there are many things you have to consider about mortgage payments, there are a few questions that are frequently asked by Canadians who are looking for a good mortgage plan and payment solution.

Why hire a mortgage broker when the Bank is there?

When you deal with a bank for the mortgage solution, you are bound by the list of products they have. It is possible that the list does not have the best solution for you. Also, banks have to think about their profit margin and will offer you the highest rate that is acceptable to you. A mortgage consultant on the other hand will have a list of lenders and mortgage products. You could potentially benefit from lower interest rates. However, if you are buying a new home or condo that is not built and you require a pre-approval letter, you must go through a bank, because a mortgage broker cannot guarantee the rate for long enough.

What fee charges are involved?

Typically there is no fee. The lenders who receive your mortgage application hand a certain amount of commission to mortgage consultants. If your application is not accepted because of job instability or bad credit, you are subjected to brokerage fee.

Do I have to wait for my mortgage to mature?

It is not a good idea to wait for that long. You should inform your mortgage consultant around 4 months before the time of maturity of your mortgage. During this time, the consultant can easily shop for other mortgage rates and your mortgage will be easily transferred if there is a possibility.

I recently heard of Mortgage Loan Insurance. What is it?

Mortgage loan insurance is required by law and is provided by three major companies in Canada: AIG Insurance, Genworth Financial Canada and Canada Mortgage and Housing Corporation (CMHC). Do not confuse this with mortgage life insurance. Here the lenders are ensured against default on mortgages with an 80% ratio of loan to value. Borrowers pay insurance premium between 0.5% and 3.7% which is directly added to the mortgage account.

What is a high-ratio mortgage and how is it different from conventional mortgage?

Conventional mortgage is the typical mortgage where the down payment is equal to 20% or more of the property’s purchase price and there is no mortgage insurance required for it.

High-ratio mortgages are where the down payment is less than 20% of the purchase price. You are required to attain mortgage loan insurance from one of the three companies that provide insurance. The borrower is allowed to purchase the house with a small amount of down payment and the lender is also protected with the loan insurance.

What form of down payment is acceptable?

If you have cash, then it is good. If, however, you do not have cash, you can use:

             Accumulated savings

             Sales proceeds that you gain from an existing house

             Your Registered Retirement Savings Plans (RRSP). Up to $20,000 can be used for down payment and if it is repaid within 15 years it will not be subjected to income tax.

             Investments that are not registered

             Borrowings from an unsecured Line of Credit.

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Thursday, July 4, 2013

The Challenges of Downsizing

Shifting from a big house to a small one, contrary to popular belief, is really not that big a deal. There can be multiple reasons for making such a move. Possibly, you have grown old and your kids have moved out or you are unable to keep up with the mortgage payments or it may just be too difficult to manage the huge space on your own. Whatever the reason may be, a major problem is finding the right house for your needs. If you are looking through real estate properties in Ottawa, you will be surprised with all the options that are available.

Once you have found the perfect new home, another challenge involved with downsizing is managing all your old stuff. Your currently large house is not only filled with pieces of furniture, it also has a few decoration items that are strewn around the room. You might want to box up and keep all the pieces for sentimental or other reasons. They could be family heirlooms, pieces you inherited or things that were given to you by a loved one.

Not to mention all the stuff stored in the attic. Though those things initially may seem worthless to keep, that emotional attachment you have to your old diaries is hard to let go. It is entirely up to you to decide what things you want to keep in the new place and what things you want to throw or give away. You must remember that you cannot take everything with you and you should be ready to let go of all the things that may hold sentimental value but are not required in your new place.

To avoid the different issues and nerve-wrecking symptoms of downsizing, make sure that you follow the following tips:

             Time your move. If you are shifting to a house that is half the size of your current one, there are a lot of things that you will have to toss out or keep in a storage container. You have to give yourself time to think through and decide on the stuff that you will keep and the stuff that you won’t.

             Get help. Ask your friends and family to help you with the move. Have one of them organize an online sale while others can take care of boxing away items.

             Be realistic. There are so many things that we can easily live without but we have made them necessities. Measure the rooms of the new place and see which furniture can be placed in them. You might have to sell some of the pieces.

             There is no need to keep a pile of papers. Except for property and tax papers, most of them would not be needed after a certain time. So throw away those college assignments that you have stowed away in the attic.

             A storage unit should be your last resort. Try to avoid renting a storage unit. Most of the people who have rented one do not even use it and the things usually rot inside.

Even though there are many challenges involved with downsizing, you can make it a fun process. Contact the Bennett Property Shop Realty today to find the best real estate property in Ottawa for your downsizing needs.
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Wednesday, July 3, 2013

Understanding Builder Warranties – Tarion: What is it?

Tarion is a private corporation that was built around 30 years ago. The company has the sole purpose of protecting the rights of home buyers and regulating new home builders. The responsibility of the company includes controlling of the Ontario New Home Warranties Plan Act in different cities of Ontario including the real estate in Ottawa.

The new head of the company is concerned that many new home owners are not aware of the exact amount of coverage they are entitled to. In September, he addressed the Greater Ottawa Home Builders’ Association and reinstalled the concept that buyers had to be educated.

Tarion was built to protect new buyers and control builders by making sure that there were no signs of shoddy workmanship. New average mid-sized homes must come with a warranty. The warranty costs around $1,000 and is usually passed from the builder to the buyer. The warranty covers the first seven years of the new house.

The first year of the warranty covers all aspects of workmanship. The second year covers building code and operating systems. The remaining years of the warranty focus on all major structural defects. It is important that all new houses are registered for warranties by the builders. Any new home that is built and sold with an Agreement of Purchase and Sale without a warranty would be categorized as an illegal building, certain acceptations do exist see below. Another way that builders can trick new home buyers is that they build the house as consultants and register the building permit in the buyer’s name. This legally makes the buyer responsible for all problems they face during the initial year and they cannot do anything about it.

If you buy a home from a registered builder you still need to understand the terms of warranty that are applicable to your property. Houses are made with natural material and therefore are subject to change. The issues related to these changes are mostly resolvable and if they are not, they can be sent to conciliation.

If you are buying a resale home that was built less than seven years ago, the house is still under warranty and the previous owner has no right to withhold the warranty. Buyers are also encouraged to send their warranty forms within 30 days, for a one or two year warranty term and register themselves at MyHome section on Tarion’s website.

There are a few types of homes that are not subjected to builder warranties: condo conversions, vacant land condos, common element condos, owner-built homes, modular homes, as-built homes, model homes, mobile homes and shell homes among a few others. You must remember to ask all the necessary questions to your real estate agents in Ottawa.

The new changes in the warranty program have helped Canadian buyers and home builders improve standards and make better decisions. For further information contact visit