Home Warranty Program
Explore what a Home Warranty Program covers in Canadian real estate, who manages it, and how it protects new homebuyers from construction defects.
May 22, 2025
What is a Home Warranty Program?
A Home Warranty Program is a form of insurance that protects new homebuyers from defects in workmanship, materials, and major structural components for a set period after purchase.
Why Home Warranty Programs Matter in Real Estate
In Canada, many provinces require builders to enroll new homes in a licensed home warranty program, especially for new construction or pre-construction properties. These programs provide peace of mind to buyers by covering specific defects or issues that arise after occupancy.
Coverage typically includes:- One year for labour and materials
- Two years for systems like plumbing, heating, and electrical
- Seven years for major structural defects
Programs vary by province. In Ontario, for example, Tarion administers the mandatory new home warranty program. In British Columbia, it's overseen by BC Housing. Coverage may also extend to delayed closings and deposit protection.
Understanding a home warranty program helps buyers know what is covered, what’s excluded, and how to file claims if issues emerge. Buyers should keep all documentation, inspection reports, and correspondence related to their home in case warranty service is needed.
Example of a Home Warranty Program?
After moving into a new townhouse in Toronto, a homeowner discovers plumbing leaks. The issue is covered under the two-year warranty, and the builder arranges repairs through Tarion.
Key Takeaways
- Protects buyers from defects in new homes.
- Mandatory in several provinces for new construction.
- Offers 1–2 years for materials and systems, 7 years for structure.
- Varies by jurisdiction (e.g., Tarion in Ontario).
- Important to document issues and submit claims on time.
Related Terms
- New Construction
- Pre-Construction Condo
- Builder Warranty
- Deficiency Inspection
- Tarion
Average and median describe different aspects of the same month’s transactions. Both are affected by the mix of homes sold.
Category averages compare different homes and locations; the gaps are not estimates of the cost to upgrade an otherwise identical property.
The five categories shown account for 5,000 of the board’s 5,057 sales. The remaining 57 transactions were in other housing categories.
Monthly observations are not seasonally adjusted. Active listings count properties available at month-end; they are not construction inventory.
Average and median prices share one dollar axis. These unadjusted transaction measures do not control for changes in the homes sold.
TRREB’s 416/905 categories compare the apartments sold in each area. The difference does not isolate a location premium for equivalent units.
5680 Oak Street in Vancouver and its surrounding context. (MCMP Architects)
Ground-level renderings of the tower proposed for 5680 Oak Street in Vancouver. (MCMP Architects)
