Ontario Home Purchasers Facing Possible Penalties for Failing to Register After Rule Modification
Hey there! Getting a new home in Ontario just got a bit more important, starting July 1st, 2025!
If you're buying a fresh freehold abode, you're now recommended to tip off Tarion, the province's new home warranty provider, about your purchase within 45 days. Missing this deadline could mean lesser deposit coverage, should something go awry with the project.
Tarion CEO, Peter Balasubramanian, explains it like this: "Think of it as letting us know you've sealed the deal. This helps us keep tabs on what's happening with the builders."
In case you're unaware, Tarion is an independent, non-profit organization that's been around since 1976, with the mission to shield buyers of new homes in the province. In simpler terms, if a contractor skips town with your hard-earned deposit, you can file a claim with Tarion.
This new requirement doesn't apply to condo buyers, only freehold.
So, how do you register your purchase? Tarion's introduced a snazzy new online platform where you can register your purchase details, like the home's address, your deposit sum, and the builder's particulars. This helps Tarion figure out if the builder's legit; if they're not, they'll halt consumers from forkling over more cash.
As of January 1, 2026, if you haven't registered within 45 days, you'll be tossed into a $10 million pool along with other unregistered buyers. The amount you get from Tarion will depend on the number of fellow buyers trying to reclaim their deposits too.
"If there's not enough for everyone, you'll end up with less, and that's a genuine risk," Balasubramanian said.
Back in February, Sheila Wang of the Star warned about potential pitfalls with the registration system.
Last year, Tarion shelled out record-breaking consumer protection payouts of approximately $80 million to nearly a thousand homebuyers who lost their deposits. This was largely due to a surge in receiverships—when a third party takes control of a financially troubled company—and a few shady builders.
"Last year really drove home the vulnerability of the fund to a scheming actor," Balasubramanian shared.
- Be cautious when investing in real-estate, especially when buying a freehold home in Ontario, as starting July 1st, 2025, it's crucial to register the purchase with Tarion within 45 days to maintain the full deposit coverage.
- Tarion, the warrantor of new homes in Ontario, advises that registering your purchase details like the home's address, deposit sum, and builder's particulars on their new online platform is essential to ensure the builder's legitimacy and protect your deposit.
- If you fail to register within 45 days, you risk being a part of a $10 million pool where the amount you receive from Tarion depends on the number of unregistered buyers attempting to reclaim their deposits.
- However, it is important to be aware that, even with this new regulation, Tarion's protection fund can still be exposed to potential manipulation by unscrupulous actors, as shown by the record-breaking $80 million consumer protection payouts they made last year to almost a thousand home buyers who lost their deposits due to factors like receiverships and shady builders.
