By Leor Margulies
Robins Appleby LLP
The provincial government and its regulatory authorities have been busy finding new ways to regulate the residential new home construction industry, all with a view to improving and enhancing consumer protection. This is all well and good, but while it finds new and cumbersome ways to increase the costs of administration for builders, the OHBA/BILD detailed proposal to amend the HCRA addendum to new home purchase agreements for both low- and highrise homes, languishes. The addendum as all parties involved agree, is outdated, cumbersome and in need of both clean up and updating. In particular, the unavoidable delay provisions have proven to be exceptionally difficult and cumbersome for builders and consumers alike. And the fallout of Tarion’s ongoing restrictive interpretation of the unavoidable delay provisions in section five of the addendum continue to plague builders and impose the late closing compensation where inequity, there should be none.
Below are some of the highlights of the latest regulatory changes in this article.
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HCRA-Condominium Buyer’s Guide
A new and improved condominium buyer’s guide was issued this summer and is required to be attached to all purchase agreements executed on or after Aug. 6, 2025. Those purchase agreements that were executed prior to that date do not require the new condominium buyer’s guide to be attached and provided to purchasers. Please ensure that these guides are provided to purchasers entering into purchase agreements after that date and an appropriate receipt is obtained. The 10-day rescission period will not commence to run unless the new buyer’s guide is provided to purchasers.
The guide has a very strong consumer protection focus with preconstruction and resale condominium checklists included, among many other provisions. The guide has increased from 36 to 68 pages. Does the government really expect residential purchasers to read through 70 pages of information? The more you give the purchasers, they less they will read and absorb. I have made this pitch to the government before, but it seems to a fallen on deaf ears.
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Tarion update
Tarion, as part of its campaign to catch unregistered builders on the lowrise front, has instituted a new warranty information sheet which is required to be attached to each new purchase agreement entered into from and after July 14, 2025. It is to include a unique Home ID/Registration Code provided by Tarion through the Tarion Portal. This is to ensure that purchasers will request and receive the completed warranty information sheet with the appropriate Home ID/Registration Code, which in turn will evidence that the builder and the project are registered, and that the builder is not taking in deposits illegally. Whether or not this additional administrative burden being imposed by vendors will work to materially reduce illegal lowrise building and taking of deposits, remains to be seen.
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Ministry of Public and Business Service Delivering Procurement (MPBSDP) – 10-Day Cooling-Off Period
Builders will recall that in June of 2024, the Conservatives, through the MPBSDP, passed the Homeowner Protection Act, 2024 which was intended to add additional consumer protections for purchasers of new freehold homes, by giving them inter alia, 10 days to terminate the agreement after execution. At that time, the Act was not proclaimed and significant discussions were held between the MPBSDP and OHBA/BILD. Concerns were raised by builders about providing newer purchasers the opportunity to shop around during this 10‑day period which would make it difficult for builders to market their homes.
In addition, there were other requirements potentially in the proposed regulations which raised concerns with builders. One of them required the payment of interest on the deposits received, even though most builders would not cash the deposits until the deal was firm, just like condominium agreements. Further, there was a requirement, separate and apart from the 10-day cooling off period to disclose on the Ontario Builder Directory, information on freehold home purchase agreement terminations. Again, regulations had not been developed at that time. It was understood that implementation and proclamation of the new legislation was going to be deferred indefinitely to address builder concerns.
It therefore came as a surprise to the industry earlier this summer on or about Aug. 6, 2025, that the MPBSDP had proclaimed the legislation effective Jan. 1, 2026 without further consultations with the industry. The ministry indicated that it would be working on the regulations between now and then. We understand that OHBA and BILD are dealing with the MPBSDP regarding the timing of implementation of this new legislation and the exact wording of any regulations. Stay tuned for further announcements from OHBA/BILD.
All of these regulations presuppose that builders are out there selling new homes in this marketplace, which of course is not the case. Rather than focusing on finding ways to encourage purchases of new homes and reducing the price by streamlining red tape and cutting taxes and other charges such as development charges, the provincial government and its regulatory authorities seem to be focused on protecting purchasers only.
All of these authorities need to start taking a balanced approach, to ensure that consumer protection does not start adding more costs unnecessarily to prices that are still currently unaffordable for most buyers.
Leor Margulies is Real Estate Group Co-Head, Robins Appleby LLP. robinsappleby.com.
