News & Resources

The 7-Year Itch: Is Your Condo Built to Last?

Oct. 16, 2014
3 mins
Overhead shot of a couple relaxing at home on their couch. The man is watching tv and the woman is surfing on her laptop.

Toronto’s condominium market is soaring as Canada’s largest city continues to attract more people for work and play. Currently, there are more than 100,000 units under construction, 123 high rise projects underway and 160 planned to start soon. That’s more than any other city in North America.  Prices have soared too, up almost 26% in the last five years.

While this demand is encouraging more investment in pre-construction condos, with it comes concern that such speedy projects are compromising on workmanship and quality and that some condos will be in need of major repair when their Tarion new home warranties run out after seven years. Critics suggest developers are more concerned with pleasing the appetite of investors than building high quality, long-lasting structures.  If you’re an investor or buying for yourself here’s what you need to know about buying into Toronto's condo boom.

What's in a Warranty?

In Ontario, newly constructed dwellings are covered under the Tarion Warranty, which protects homeowners from major structural defects (MSD) for seven years. This includes, as described by the Ontario new Home Warranties Plan, any defect in work or materials in respect to a building, including a crack, distortion or displacement of a structural load-bearing element. The seven-year MSD warranty includes significant damage due to soil movement, major cracks in basement walls, collapse or serious distortion of joints or roof structure and chemical failure of materials. For most condominium projects, warranty coverage also includes the shared areas of the building, referred to as common elements. However, many are worried that Toronto's condos will continue to have issues after this warranty expires - with homeowners on the hook for the cost.

Look Into Developer History

News of glass falling from some of Toronto's high rise projects has called current building standards into question - will today's buildings last 50 years? Tarion recommends buyers should look beyond the marketing materials and research their builders.  The Ontario Builder Directory at Tarion.com shows a listing of every registered builder in Ontario and includes a 10-year history of any chargeable conciliations and the number and amounts of certain claims.

Don't Settle on Standards

If you’re concerned about the quality of construction of a condo building, then it would be wise to look at another project. With so many units available there is a no reason new condo buyer should settle on a building that they are not 100% satisfied with. We all know that not everything goes to plan, especially when it comes to a new development. So many factors, like weather, shipment of materials and availability of workers, can all delay a project. Builders are entitled to extend the occupancy date specified in a purchase agreement as long as they provide proper notice. Owners are entitled to compensation if proper notice is not given.

Are you a condo buyer or owner who's concerned about your building's structural quality? Let us know in a comment, or visit us on Facebook and Twitter.

Rubina Ahmed-Haq

Rubina Ahmed-Haq is a financial journalist and personal finance expert with more than 15 years of experience. Her career spans three continents with appearances on TV, radio, print and online. She is the Finance Editor for HOMES Publishing. You can also read her columns in CondoLife and Active Life. Rubina runs the website www.AlwaysSaveMoney.ca. She has also contributed on personal finance matters at The Toronto Star, The Globe and Mail, National Post, CTV Newschannel, Mississauga Life Magazine, Masalamomma.ca, OurKidsMedia, CAA Magazine, South Asian Focus TV, ANOKHI Magazine, Bridal Fantasy Magazine, Canadian Running Magazine, FRESH JUICE magazine and NEWSTALK 1010.

Latest life insurance articles

10 Myths About Life Insurance Busted – Some May Surprise You
You may be young with no kids and no mortgage. Life insurance is for someone older, who has dependents right? Wrong. Let’s debunk life insurance myths and learn why everyone needs some form of coverage.
Will a Life Insurance Policy Cover Death Due to COVID-19?
Demand for life insurance may be on the rise during the pandemic as more Canadians consider buying a policy or reviewing ones they already have. If you’re thinking of applying for a policy, here are a few things to keep in mind.
How Does Vaping and e-Cigarettes Affect Life Insurance?
Many insurers may classify vaping in the same way they do smoking. If you smoke or vape, you can still qualify for a life insurance premium, but in all likelihood, you will pay a higher rate than someone who does not.