Buying a new home can be a very exciting as well as a very confusing experience. There are several things to consider before entering into a final agreement with a contractor to build your new home.

1. Is the contractor a Registered Builder with the Tarion Warranty Program?

2. Is there a cost for this Warranty?

3. What about G.S.T.?

4. What is included in the purchase price of my new home?

5. Should I use a Realtor when purchasing a new home?
   
   

Is the contractor a Registered Builder with the Tarion Warranty Program?

The Tarion New Home Warranty Corporation
is the Regulator of the new home building industry in Ontario, and in this role, licenses all new home and condominium builders in the province and ensure that all new homeowners receive the new home warranty coverage that they are entitled to by law.

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Is there a cost for this Warranty?

Yes. The cost varies depending on the price of the home being constructed and can range from approximately $600 to $1,300. This cost is incurred by the builder and may or may not be passed along to the purchaser. This should be stipulated in the contract.

Only Registered Builders may display the ONHWP logo shown below. For more information on the Ontario New Home Warranty Program, click on the logo to visit their web site.

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What about G.S.T.?

New housing is subject to the Goods and Services Tax which is paid directly to the builder when purchasing a new home. There are some rebates that effectively reduce the tax rate. These rebates are usually assigned to the contractor as part of the agreement. This is taken into account when determining the final purchase price. This amount is called the NET GST.

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What is included in the purchase price of my new home?

Many home builders have a model home already constructed to demonstrate to prospective purchasers the materials and workmanship of their product. Often these homes include upgrades and extras that are not listed in the builder's standard features. It is very important to be aware of what is included and what is something that is above and beyond the norm.

Extras and upgrades make the home much more appealing, but can also add up to a significant difference in the price. Anything that is to be included in your new home that is not a standard feature should be specifically listed in the agreement. It may mean a bit more leg work before signing the final contract, but it can save a lot of aggravation and surprises later on.

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Should I use a Realtor when purchasing a new home?

Many building contractors may try to discourage a prospective customer from seeking the advice of a professional realtor and may even imply that there may be an extra cost involved. However there are many things to consider when building a new home and a professional realtor can help deal with all of these concerns as well as negotiate on your behalf. A building contractor may have a real estate representative or an "in house" salesperson. These people are paid to represent the best interests of the builder and therefore get the most money for the home that you are purchasing. By having a realtor represent you, you have someone trying to get you the best deal possible.

A realtor familiar with new housing construction can also help you to locate the most reputable builder and point out differences in workmanship and materials that you may not notice. Many new home buyers are fooled by the shiny new appearance of a new home and often overlook major structural issues that will affect the value of their property for years to come.

I have worked with several builders in and around the London area, am very familiar with New Housing construction and would welcome the opportunity to help you with your new home purchase. If you have any questions please contact me anytime. 

Phone: 519-673-3390.  E-mail: kathy@london3dhomes.com

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