Tarion warranty (Ontario new-home warranty)

reference · Scope: marketing-site · Status: current
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Created 2026-06-11

Overview

Tarion Warranty Corporation is the administrative authority that administers Ontario's mandatory new-home warranty program under the Ontario New Home Warranties Plan Act (ONHWPA, R.S.O. 1990, c. O.31). It was created in 1976, when the ONHWPA was proclaimed into force in September of that year. Tarion is a not-for-profit corporation under the Corporations Act and is not a Crown agency. It is an "administrative authority" delegated by Ontario under the Safety and Consumer Statutes Administration Act and the ONHWPA, financed entirely by builder enrolment/registration fees plus investment income — it takes no public funds. [Verified]

From 1976 until February 1, 2021, Tarion was both the warranty insurer and the regulator of Ontario home builders. That structural combination — the same body that licensed builders also adjudicated homeowner warranty claims against them — was the subject of sustained criticism, most notably from Canadians for Properly Built Homes (CPBH) and in the Cunningham Review (2016–2017). On February 1, 2021, when the New Home Construction Licensing Act, 2017 came into force, builder licensing and conduct enforcement were transferred to a new body, the Home Construction Regulatory Authority (HCRA), while Tarion retained warranty administration, deposit protection, the Guarantee Fund, conciliation and claims resolution. The clean shorthand: HCRA licenses builders; Tarion insures homes. [Verified]

Tarion's statutory warranty has a "1-2-7" structure — one year for workmanship and materials, two years for the building envelope and major delivery/distribution systems, and seven years for Major Structural Defects. Coverage caps depend on when the Agreement of Purchase and Sale (APS) was signed; the current freehold post-possession cap is $400,000 for APS on/after July 1, 2023. Tarion also administers deposit protection (freehold and condo), delayed-closing compensation, the Pre-Delivery Inspection (PDI) framework, and a conciliation and dispute-resolution process that culminates in appeals to the Licence Appeal Tribunal (LAT). [Verified]

The program has been the subject of multi-year investigative reporting (Toronto Star's Kenyon Wallace from 2013 onward; CBC's Laura Osman around the 2019 reform cycle), a 2019 Auditor General special audit, the Cunningham Review's 37 recommendations (most not adopted), and continuing critique from CPBH on monopoly structure, NDA-bound mediation, and inadequate coverage caps. In 2024 the Guarantee Fund paid out more than $100 million — one of the largest single-year consumer-support payouts in the program's history — driven by builder bankruptcies and over 900 verified deposit claims, which in turn drove the $250 temporary capital-replenishment surcharge on enrolments introduced September 1, 2025. [Verified]

History — 1976, ONHWPA, the Cunningham Review

Tarion Warranty Corporation was created in 1976 to administer Ontario's new-home warranty program. Its governing statute is the Ontario New Home Warranties Plan Act (ONHWPA, R.S.O. 1990, c. O.31), proclaimed into force in September 1976. Tarion is a not-for-profit corporation under the Corporations Act, not a Crown agency. It is an administrative authority delegated by Ontario under the Safety and Consumer Statutes Administration Act and the ONHWPA. It is financed entirely by builder enrolment/registration fees plus investment income — it takes no public funds. Tarion reports to the Ministry of Public and Business Service Delivery (formerly Government and Consumer Services) under an Administrative Agreement; the same Ministry oversees HCRA. [Verified] (Sources: Ontario.ca Cunningham Interim Report; Tarion governing documents page.)

Governance (post-2019 reforms): 12-member board, with the Minister appointing four; five-member Nominations Committee (two ministerial appointees). Directors serve three-year terms with a nine-year cap. Industry representation is capped at no more than one-third of directors after the November 27, 2019 Minister's Order. See Tarion 2019 Auditor General Special Audit (Bonnie Lysyk) — 65% of conciliations found builder at fault, 9,700 dismissed for missed deadlines (1,300 by 1 day), OHBA "disproportionate influence". [Verified]

Cunningham Review (2016–2017)

Before 2021, Tarion was both the warranty insurer and the regulator of Ontario home builders — a structural conflict of interest CPBH had flagged for years. In November 2015, Ontario appointed retired Associate Chief Justice J. Douglas Cunningham, Q.C. to review the ONHWPA and Tarion. The Interim Progress Report was released in July 2016; the Final Report in December 2016 (released early 2017), with the formal Final Report dated March 28, 2017 and containing 37 recommendations. [Verified] (Source: Ontario.ca Final Report URL — https://www.ontario.ca/document/final-report-review-ontario-new-home-warranties-plan-act-and-tarion-warranty-corporation.)

Cunningham's headline recommendation was to separate the regulator function from the warranty function. He also flagged illegal building, weak transparency on Tarion's Consumer Advisory Council, perceived board capture by industry, and dispute-resolution conflict of interest.

Key recommendations:

  • Mandatory new-home warranty should continue but should be delivered through a multi-provider insurance system (like British Columbia, Alberta, Manitoba).
  • Builder and vendor regulation should be a separate administrative authority from the warranty body.
  • Adjudication of unresolved warranty disputes should be delivered through an independent body.
  • Mandatory warranty coverage should extend to owner-built homes intended for personal occupation.

Adopted: the HCRA split (Feb 1, 2021); a skills-based board model; executive compensation reforms; Ombudsperson independence; formal mediation under O. Reg. 242/21.

NOT adopted:

  • Multi-provider insurance model — Tarion remains the sole warranty administrator.
  • Independent first-instance adjudication — Tarion still conducts conciliations itself.
  • Mandatory warranty for owner-built homes — still excluded.

Per Karen Somerville's testimony to the Standing Committee on January 21, 2020, only "two or three" of the 37 Cunningham recommendations were included in Bill 166, the Strengthening Protection for Ontario Consumers Act, 2017. The clean way to summarize the Cunningham legacy: "Cunningham asked for two things: separate the regulator, and break the monopoly. Ontario did the first; not the second." [Verified]

Ontario acted in 2017 with Bill 166 (the Strengthening Protection for Ontario Consumers Act, 2017). HCRA launched February 1, 2021.

Post-2021 split — what Tarion retained, what HCRA took

When the New Home Construction Licensing Act, 2017 came into force on February 1, 2021 and HCRA was designated as Ontario's new-home builder regulator, the previously-combined Tarion role was split.

HCRA took over: licensing, competency assessment, code-of-conduct enforcement, complaints about builder conduct, illegal-building investigations, and the Ontario Builder Directory (OBD).

Tarion retained: warranty administration, the Qualification for Enrolment (QFE) process, home enrolments, deposit protection, the Guarantee Fund, conciliation and claims resolution, and pre-possession risk-based inspections. [Verified] (Sources: Tarion announcement at https://www.tarion.com/media/introducing-home-construction-regulatory-authority-and-new-changes-tarion; HCRA mandate at https://www.hcraontario.ca/what-we-do/.)

Transition mechanics: Builders in good standing on Feb 1, 2021 had their Tarion registration numbers automatically transferred to HCRA licence numbers. New applicants must now be HCRA-licensed first before they can apply to Tarion for QFE Confirmation and enrol any home.

The 1-2-7 warranty — year-by-year coverage

Tarion's statutory warranty runs up to seven years from the date of possession and stays with the home if it is sold. The structure is "1-2-7": [Verified] (Source: https://www.tarion.com/builders-guide-coverage-homes.)

Year 1 (Possession + 1 year):

  • Defects in work and materials.
  • Unauthorized substitutions for items specified in the APS.
  • Items rendering the home unfit for habitation.
  • Ontario Building Code violations affecting health and safety.
  • Water penetration through basement or foundation walls.
  • Defects causing water penetration through the building envelope (windows, doors, caulking).
  • Defects causing detachment or deterioration of exterior cladding.
  • Defects in electrical, plumbing and HVAC delivery/distribution systems.

Year 2 (Possession + 2 years):

  • Water penetration through basement or foundation walls.
  • Defects causing water penetration into the building envelope.
  • Defects causing detachment, displacement or deterioration of exterior cladding.
  • Defects in electrical, plumbing and heating delivery/distribution systems.
  • OBC violations affecting health and safety.

Years 3–7 (Major Structural Defects only): The MSD test framework defines what qualifies — see below.

Major Structural Defect (MSD) — the three-test framework

A Major Structural Defect (MSD) under Tarion's 7-year warranty is any defect in work or materials that meets any one of three tests: [Verified] (Source: Tarion Registrar Bulletin 03 — Major Structural Defects; Builder Bulletin 24R supplements.)

  1. Failure test — results in failure of a structural load-bearing element of the building.
  2. Function test — materially and adversely affects the ability of a structural load-bearing element to carry, bear and resist applicable loads for its usual service life.
  3. Use test — materially and adversely affects the use of a significant portion of the building for usual residential purposes.

Examples that qualify: significant damage from soil movement; major basement-wall cracks compromising the structure; collapse or serious distortion of joists or roof structure; chemical failure of materials (e.g., excessive radon ingress affecting habitability).

Examples explicitly excluded from MSD: cosmetic dampness; damage to drains; damage to finishes; condensation issues not tied to a structural failure.

The same coverage cap pool covers MSD and earlier-year claims combined. A $50K environmentally-harmful-substances sub-limit (radon, mould) applies for APS on/after Feb 1, 2021. [Verified]

Coverage caps — APS-date tiers (2023 changes)

Tarion post-possession coverage caps depend on when the Agreement of Purchase and Sale was signed. [Verified] (Source: https://www.tarion.com/post-possession-coverage.)

APS signed Freehold cap Condo unit cap Common-elements cap Project cap
Before Feb 1, 2021 $300,000 $300,000 $50,000 × units, max $2.5M $50M
Feb 1, 2021 – June 30, 2023 $300,000 $300,000 $100,000 × units, max $3.5M $50M
On/after July 1, 2023 $400,000 $300,000 $100,000 × units, max $3.5M $50M

Sub-limits:

  • Environmentally harmful substances (radon, mould): $50,000 for APS on/after Feb 1, 2021. Pre-Feb 2021 agreements had a $15,000 mould/radon cap.
  • Septic systems: $25,000 cap on pre-Feb 2021 agreements (subsumed into general coverage afterwards).

Practical context: CBC Marketplace (Sept 25, 2024) profiled a couple whose 4-year-old Ontario home they described as a teardown. Tarion spokesperson Andrew Donnachie acknowledged the $300,000 max "may not be sufficient to entirely remove a foundation, demolish a home and rebuild" but described such cases as "exceedingly rare." CPBH has argued caps remain insufficient for serious construction-defect remediation. [Verified for Tarion quote; CPBH position is Reported.]

Deposit protection — freehold and contract homes

Current limits (freehold APS on/after Jan 1, 2018): [Verified] (Source: https://www.tarion.com/media/how-does-deposit-protection-work-new-homes.)

Sale price Deposit coverage
≤ $600,000 up to $60,000
> $600,000 10% of price, capped at $100,000

Contract homes (owner-land, contracted to a licensed builder): $40,000 Financial Loss Coverage if the builder fails to substantially perform. [Verified] (Source: https://www.tarion.com/coverage-before-you-close.)

Trigger: Deposit protection pays out if the agreement of purchase and sale is terminated through no fault of the buyer (typically builder insolvency or project cancellation). If the agreement is terminated, the deposit must be returned in full within 10 days.

Deposit protection — condominium

Condominium deposits are protected differently from freehold deposits. Under s. 81 of the Condominium Act, 1998, condo deposits up to a defined project threshold must be held in trust by the builder. Amounts above that threshold must be covered by a Tarion deposit-insurance certificate. If a deposit that should have been in trust was not, Tarion provides up to $20,000 of backup protection. [Verified] (Source: https://www.tarion.com/homeowners/pre-possession-coverage.)

If the APS is terminated, the deposit must be returned in full within 10 days.

No change in April 2026: the upcoming O. Reg. 17/25 deposit changes apply to freehold only. Condo deposit protection is unchanged. Many pre-construction condo buyers assume Tarion fully protects their entire deposit; the reality is that most of the deposit is protected by the trust mechanism (which Tarion does not administer), with Tarion as a $20K backup.

April 2026 freehold 45-day notice rule (O. Reg. 17/25)

Under O. Reg. 17/25, freehold purchasers must notify Tarion within 45 days of signing the APS to qualify for the full deposit coverage limit. Effective dates: [Verified] (Source: https://www.tarion.com/node/66087.)

  • April 1, 2026: 45-day notice rule takes effect.
  • January 1, 2027: coverage-tier changes take effect (separate $15M annual sub-fund for buyers who didn't notify; pro-rated payouts if total claims exceed it).

Buyers who do not notify within 45 days share the separate $15M annual sub-fund instead of the main pool. If total claims against that sub-fund exceed $15M in a year, payouts are pro-rated. The current limits remain in effect through that transition; the tier change is deferred to Jan 1, 2027.

Caveat: Rule mechanics could be amended further before April 2026. Re-verify against tarion.com closer to the date.

Delayed-closing / occupancy compensation

When a builder misses the Firm Closing Date or Firm Occupancy Date without an Unavoidable Delay or a mutual extension, Tarion delayed-closing compensation applies: [Verified] (Source: Tarion Registrar Bulletin 06C — Delayed Closing/Occupancy and Critical Dates.)

  • $150/day for living expenses (meals, accommodation) — no receipts required.
  • Plus receipted direct costs (moving, storage).
  • Total cap: $7,500.
  • Plus $1,500 ($150 × 10 days) if the builder fails to give 10 days' notice of the delay.

Claim window: 180 days from the closing/occupancy date or termination, to the builder. If unresolved, claim to Tarion within one year of possession or 365 days from termination.

Unavoidable Delay is defined narrowly: strike, fire, explosion, act of God, civil insurrection, act of war or terrorism, pandemic. Outside those, the builder owes compensation. The 10-day notice obligation is the single most-missed builder step and the cheapest to comply with — a $1,500 avoidable penalty per home if missed.

Condominium common elements

Common-element defects are claimed by the condominium corporation — not individual unit owners. Coverage starts on the date the corporation is registered (or the amendment date for phased projects). The condo board appoints a designate and submits warranty forms following its performance audit — a structural and systems audit conducted in the first year by an engineer retained by the board. The performance audit can itself be submitted as a warranty form. [Verified] (Source: Tarion Registrar Bulletin 02 — Common Elements.)

Not covered as common elements: Vacant land condos and common-element condos do not have common-elements warranty coverage.

Coverage cap: For APS on/after Feb 1, 2021, common-element coverage is $100,000 × units to a $3.5M maximum, project cap $50M.

Conciliation for common elements: Chargeable common-elements conciliations carry a $3,000+HST builder charge (vs $1,000+HST for individual units).

Residential Condominium Conversion Projects (RCCPs)

Tarion covers Residential Condominium Conversion Projects (RCCPs) — buildings converted to residential condominiums after January 1, 2018. One key exception: pre-existing elements (e.g., the original façade, foundation, structural elements retained from the prior building) are not covered by the year-1 workmanship and materials warranty. They are covered for OBC violations, water penetration, distribution systems (year 2), and major structural defects (years 3–7). [Verified] (Source: Tarion Registrar Bulletin 51 — Residential Condominium Conversion Projects.)

RCCPs are a fast-growing segment in Ontario urban infill. Buyers of a converted-warehouse condo often don't realize the brick façade they bought into has a different warranty regime than the new mechanical systems.

Renovation boundary — what Tarion does and does not cover

What Tarion covers:

  • Newly constructed homes by HCRA-licensed builders.
  • Contract homes — owner-land, contracted to a licensed builder; same 1-2-7 structure plus $40K financial-loss coverage.
  • Custom cottages and seasonal homes meeting the OBC for occupancy and built by a licensed builder.
  • Residential Condominium Conversion Projects (RCCPs) post-Jan 1, 2018 — with pre-existing elements excluded from year-1 workmanship.

What Tarion does NOT cover: [Verified] (Sources: Cohen LLP commentary on substantial-renovation boundary; Miller Thomson analysis of "builder" definition; Tarion [email protected] — canonical edge-case channel.)

  • Renovations to existing homes — full stop. Even substantial renovations are outside the ONHWPA.
  • Owner-built homes intended for personal occupation. The owner-built exemption has long been criticized by Cunningham and CPBH as a loophole.
  • Substantial renovations sold as "new" — case-by-case. Cohen LLP notes Tarion warranty cannot be bought for "houses re-built upon existing foundations (substantial renovation)" but Tarion has investigated cases where sellers misrepresented status. Whether the renovator meets the statutory definition of "builder" is fact-dependent (Miller Thomson analysis turns on degree of control).

Warranty exclusions (ONHWPA s. 13(2))

Per ONHWPA s. 13(2) and Tarion's "What is not covered" page, the warranty does not cover: [Verified] (Source: ONHWPA s. 13(2); Tarion "What is not covered" page.)

  • Defects in materials, design and work supplied by the homeowner.
  • Secondary damage caused by defects under warranty (e.g., personal-property damage, personal injury).
  • Normal wear and tear; normal shrinkage of materials caused by drying.
  • Damage from dampness or condensation due to homeowner failure to ventilate.
  • Damage from improper maintenance.
  • Alterations, deletions or additions made by the homeowner.
  • Subsidence of land around the building (other than beneath the footings).
  • Damage resulting from an act of God (extraordinary natural events only).
  • Damage caused by insects/rodents (unless building violates the OBC).
  • Damage caused by municipal services or other utilities.
  • Surface defects specified and accepted in writing by the owner.
  • Elevators, HVAC appliances and certain other appliances (explicitly excluded from common-elements coverage).

The three exclusions buyers find most surprising:

  1. Secondary damage — water damage to furniture from a warranted plumbing leak is not covered.
  2. Dampness/condensation tied to inadequate ventilation by the homeowner.
  3. Homeowner alterations that void the warranty on the modified item.

Pre-Delivery Inspection (PDI)

The PDI is the mandatory pre-possession walk-through with the builder. The buyer or an appointed designate (paid home inspectors are permitted) must attend. The PDI Form records anything damaged, missing, incomplete, not operating properly, or that cannot be assessed at the time. The buyer/designate signs it. [Verified] (Source: https://www.tarion.com/homeowners/predelivery-inspection.)

Legal effect of the PDI Form:

Practical buyer guidance:

  • Bring: phone (photos + video), flashlight, tape measure, APS with all schedules, the finishes/features schedule.
  • Bring someone — a designate or paid home inspector is allowed.
  • Tarion's rule of thumb: about one hour per 1,000 sq ft.
  • Test every faucet, appliance, window, door, light switch; the HVAC; the AC if seasonally appropriate.
  • For anything you can't physically assess (snow on the roof, scaffolding still up, fresh paint), write that on the form — don't just sign past it.
  • Note unauthorized substitutions against the APS.
  • Photograph everything with date stamps.

Initial warranty claims after possession go via the 40-day Initial Submission (post-May 2024) — see Tarion claim forms post-May 2024 CSS reform — 40-day Initial, new Mid-Year, Year-End (with permanent 10-day grace), Second-Year, MSD. The PDI Form is not that submission.

Conciliation process (CSS, MSD test in practice)

Conciliation is Tarion's adjudication step. Standard flow: [Verified] (Source: Tarion Registrar Bulletins 01 and 04; https://www.tarion.com.)

  1. Homeowner files a warranty form (Initial, Mid-Year, Year-End, Second-Year, or MSD — see Tarion claim forms post-May 2024 CSS reform — 40-day Initial, new Mid-Year, Year-End (with permanent 10-day grace), Second-Year, MSD) with both Tarion and the builder. This starts a 120-day builder repair period. MSD claims have a 90-day initial discussion period.
  2. Builder attempts repair. Homeowner must provide reasonable access.
  3. Request a conciliation if items remain unresolved. Homeowner pays a $282.50 ($250 + HST) deposit to book the inspection.
  4. Tarion conciliation inspection. Warranty Services Representative attends with the builder and assesses each item against the ONHWPA and the Construction Performance Guidelines (CPG, 3rd Edition).
  5. Conciliation Assessment Report issued.
  6. If any item is warranted, the conciliation is "chargeable":
    • Builder invoiced $1,000 + HST per home/unit ($3,000 + HST per common-element conciliation).
    • Homeowner's $250 deposit refunded.
    • Chargeable conciliation stays on the builder's Ontario Builder Directory record for 10 years.
  7. Final 30-day builder repair window after the Report.
  8. Tarion settles directly if items remain unresolved — pays compensation from the Guarantee Fund or arranges the repair — then invoices the builder with a 15% administration fee.

The 65% finding: The 2019 Auditor General found that in approximately 65% of the 6,485 conciliation requests Tarion assessed from 2014–2018, the builder should have fixed the defect under warranty but hadn't — see Tarion 2019 Auditor General Special Audit (Bonnie Lysyk) — 65% of conciliations found builder at fault, 9,700 dismissed for missed deadlines (1,300 by 1 day), OHBA "disproportionate influence".

Decision standard: Tarion applies the Ontario Building Code, the Construction Performance Guidelines (CPG, 3rd Edition), and the ONHWPA s. 13 warranties/exclusions.

Dispute-resolution paths (DRS, mediation, BAF, LAT, civil court)

After a Tarion decision, homeowners have five dispute-resolution paths: [Verified for process framework; CPBH critique is Reported.] (Sources: O. Reg. 242/21 — Tarion mediation framework; CPBH commentary on mediation NDAs.)

  1. Dispute Resolution Specialist (DRS) review — internal Tarion process. Does not affect appeal rights.
  2. Independent mediation under O. Reg. 242/21. CPBH has flagged that mediated settlements typically require homeowners to sign non-disclosure agreements, which prevents independent evaluation of how often Tarion settles and on what terms.
  3. Builder Arbitration Forum (BAF) — for builders only. Cannot be initiated by homeowners.
  4. Licence Appeal Tribunal (LAT) — see below.
  5. Civil court / Small Claims Court — homeowners retain the right to pursue ordinary court claims.

Two practical truths:

  • Mediation outcomes are typically confidential (NDA), so the public can't evaluate Tarion's mediation track record.
  • The Builder Arbitration Forum is a builder-side tool — homeowners can't use it.

LAT — 30-day appeal window

Homeowners who disagree with a Tarion decision can appeal to the Licence Appeal Tribunal (LAT) within 30 calendar days of a Decision Letter. Process: [Verified] (Source: Tribunals Ontario LAT info sheet — LAT_ONHWPA_InformationSheet.pdf.)

  • Request a Decision Letter from Tarion.
  • File a Notice of Appeal with LAT within 30 days of the Decision Letter.
  • LAT can confirm, vary, or overturn Tarion's decision.
  • First hearing event typically about 37 days after a complete application.
  • Final written decision typically follows within 40 days of the hearing.

Important distinction from HCRA appeals: HCRA-related orders/NOPs get 15 calendar days to LAT. Tarion-related decisions get 30 days. Don't mix them up.

Self-represented success rate: NSRLP advocate Barbara Captijn writes that "Most SRLs lose their cases" when facing Tarion at LAT. No published numeric rate exists from Tribunals Ontario. Treat as [Reported], not [Verified]. The often-cited "over 80%" figure is not corroborated by an official source. LAT is a real path but a tough one for self-represented homeowners; it is the final administrative-law option homeowners have before civil court.

Builder enrolment — QFE, Enrolment Confirmation, builder obligations

Two-step builder authorization for new-home construction in Ontario: [Verified] (Source: https://builderportal.hcraontario.ca/en-US/faq/; Tarion QFE documentation.)

  1. HCRA licence — required to legally build or sell new homes.
  2. Tarion QFE + Enrolment Confirmation — required for each home:
    • Qualification for Enrolment (QFE) Confirmation before agreeing to sell or starting construction.
    • Enrolment Confirmation before excavating or beginning the foundation.
    • Municipalities generally will not issue building permits without Enrolment Confirmation.

Builder obligations (ongoing):

  • HCRA-licensed and Tarion-enrolled for every home before sale or construction.
  • Attach the Warranty Information Sheet and addendum to every APS (mandatory since Feb 1, 2021).
  • Conduct the PDI with the buyer or their designate.
  • Repair warranted items within the builder repair periods (120 days standard, 30 days post-conciliation, 90 days for MSD discussion).
  • Respond to Tarion information requests during conciliation; provide drawings, specs, trade info.
  • Must not block homeowner access to Tarion forms or coerce buyers into waiving warranty rights.

Builder-specific security: Tarion's QFE process can require additional security (letters of credit, security deposits) set in a Notice of Proposal of Conditions, based on a risk profile. New builders typically face higher security requirements than established licensees.

Enrolment fees — Registrar Bulletin 15 (Sept 1, 2025)

Under Registrar Bulletin 15 (revised, effective September 1, 2025), Tarion stated: "The new average one-time fee will be $1,790 payable by the vendor for a new home," representing "a 3.1% increase in enrolment fee for the average home priced at $800,000." [Verified] (Sources: https://www.tarion.com/media/tarion-implementing-updated-enrolment-fee-schedule; Tarion 2025 Public Consultation discussion guide.)

Sliding scale (current schedule):

  • Sale price ≤ $550,000: no fee change (approximately 14.4% of total enrolments).
  • Sale price > $550,000 up to $4M: progressive increases.
  • Maximum enrolment fee: $6,000.
  • Charitable/not-for-profit homes: exempt.
  • Condo conversion units: pay 2× the standard fee.
  • Per-enrolment cancellation fee: $50 + HST.
  • All fees subject to HST.

$250 temporary capital-replenishment surcharge is included to rebuild the Guarantee Fund after 2024's deposit-payout crisis. Per Tarion's 2025 Public Consultation discussion guide: "The current plan projects to raise close to $30 Million over three years, depending on the level of new home construction activity." The fee is passed through to the new-home buyer at closing as an adjustment. On a $1M+ home it can be a four-figure line item buyers notice.

Caveat — time-sensitive: re-verify before quoting in long-form work. Tarion adjusts the fee schedule periodically.

Guarantee Fund — the 2024 payout crisis

The Guarantee Fund is Tarion's reserve that pays warranty obligations when a builder is bankrupt, insolvent, has had its licence revoked, or refuses to perform. Tarion can pay the homeowner directly, arrange repairs by a Tarion-retained contractor, or pay deposit-protection claims. [Verified] (Source: Tarion 2024 Annual Report.)

2024: the Fund paid out more than $100 million — Tarion describes it as one of the largest single-year consumer-support payouts in the program's history — driven by builder bankruptcies (Stateview, GC King Bond, others) and over 900 verified deposit claims.

Fund balance: The 2024 Annual Report did not fully expose the year-end Fund balance in the section reviewed. For historical context, the Fund stood at $592.3 million in 2018 (per the 2019 Auditor General audit).

The $250 temporary capital-replenishment surcharge on each home enrolment is designed to recapitalize the Fund after the 2024 payout. Tarion projected raising close to $30M over three years.

Related enforcement context: The 2024 deposit-payout crisis is the same period that drove HCRA enforcement against Stateview ([[stateview-homes-453-illegal-sales-charges-2023]]), GC King Bond ([[gc-king-bond-16m-amp-code-of-ethics-2024]]), and Albion ([[albion-construction-1m-fine-dec-2025-largest-case]]). Tarion paid deposits; HCRA pursued discipline.

Tarion + HCRA — the dual-gate rule

An Ontario new-home builder/vendor needs both an HCRA licence and Tarion authorization (Qualification for Enrolment, or QFE) to legally build or sell a new home. An HCRA licence alone is not enough. [Verified] (Source: https://builderportal.hcraontario.ca/en-US/faq/.)

Roles split:

  • HCRA — licenses the company/principals; runs the OBD; investigates and disciplines; prosecutes illegal builders.
  • Tarion — administers the Ontario New Home Warranties Plan; enrols individual homes; pays warranty claims; underwrites new builders through QFE.
  • MPBSDP (Ministry of Public and Business Service Delivery and Procurement) — sets legislation and oversees HCRA.

Every major illegal-building prosecution (Albion, Stateview, Pinetree, Hiebert) involved failure to enrol new homes with Tarion — not just unlicensed building. If a home is for sale but not enrolled with Tarion, that's the textbook illegal-build scenario HCRA prosecutes. The OBD's "Confirm Your Home's Warranty" search ties the two together for buyers.

Builder display rules — what builders can and cannot say (post-2021)

Tarion and HCRA have a coordinated marketing-disclosure position: [Verified] (Sources: GSNH LLP and Mondaq guidance on the 2021 marketing-rule change; HCRA Directive — Licence Display Requirements.)

  • Builders must NOT continue to advertise themselves as "Tarion Registered Builders" after February 1, 2021. Old Tarion Registered Builder logos should be removed from materials, signage and advertising and replaced with "licensed by the HCRA."
  • Builders MUST display their HCRA licence at their principal business address, on their website (if they have one), and at any premises where they conduct business with the public — under s. 4 of O. Reg. 626/20 to the New Home Construction Licensing Act, 2017. The licence must be displayed without obstruction in a publicly accessible location.
  • Referring to the warranty itself ("Tarion-warrantied," "Tarion warranty included," "Backed by the Tarion Warranty Corporation") is permissible — every new home in Ontario from a licensed builder is, by law, enrolled in the warranty.
  • False or misleading advertising is a breach of the HCRA Code of Ethics and a basis for licence action.
  • Builders cannot misrepresent licensure status or imply HCRA/Tarion endorsement of construction quality beyond what the program provides.

Practical clarification:

  • "Tarion Registered Builder" badge — must be removed.
  • "Licensed by the HCRA — Licence #B[xxxxx]" — required.
  • "Every new home backed by the Tarion Warranty" — permissible if accurate.
  • "Tarion-approved" or "HCRA-endorsed" — misleading; the licence is permission to operate, not an endorsement.

Builder-website Tarion display audit (May 2026)

May 2026 sample audit of Ontario builder websites for Tarion-warranty disclosure: [Single-source — illustrative, not exhaustive.] (Source: Candid Creative internal audit, May 2026.)

Builder Tarion disclosure pattern
Mattamy Homes Dedicated "Ontario Warranty Information" page under Customer Care; closing-cost documents reference HCRA and the Tarion enrolment fee.
Tridel Dedicated "Warranty & Tarion" page; strong Tarion branding; links Tarion's Learning Hub.
Minto Communities Best-in-sample for disclosure detail. Detailed Tarion warranty workflow (30/40-day Initial, Year-End, Year-2, MSD) described on dedicated post-move-in pages. Explicit HCRA licence PDFs linked.
Tamarack Homes Dedicated Tarion warranty resource page describing 1-, 2-, 7-year coverage and conciliation.
Branthaven Homes References Tarion's MyHome portal on Contact/Warranty page.
DeSantis Homes Customer-service page combines HCRA and Tarion sections with claim-form links — a clean unified model.
Daniels, Treasure Hill, Fernbrook, Madison, Great Gulf, Brookfield Residential, Empire Communities Tarion references appear inconsistently across marketing materials.

General pattern: Major Ontario builders consistently reference Tarion via dedicated warranty/customer-care pages, but the depth varies widely. Minto and Mattamy treat Tarion as a customer-care competency; smaller boutique builders sometimes treat it as a one-line footer mention.

Cleanest pattern observed: Minto's post-move-in workflow pages, which step buyers through Initial, Year-End, Year-2, and MSD forms by name. This is genuinely useful content (vs. brochure-style "we are Tarion-backed").

Caveat: sample is illustrative. A definitive audit would require browser-rendered visits to 25–30 builder sites with screen-capture evidence.

Candid Creative builder-site disclosure rule

Every Candid builder-client site should surface Tarion warranty coverage on every new-home product/landing page, with the 1-2-7 structure named and CSS forms referenced. [Verified — regulatory facts; Industry-consensus — best practice.]

  1. Surface Tarion warranty coverage on every new-home product/landing page — not buried in a privacy-policy-style footer. Buyers research Tarion before signing.
  2. Name the 1-2-7 structure explicitly (1-year workmanship, 2-year building envelope/systems, 7-year MSD).
  3. Reference the post-May-2024 CSS forms (Initial 40-day, Mid-Year, Year-End with permanent 10-day grace, Second-Year, MSD) — see Tarion claim forms post-May 2024 CSS reform — 40-day Initial, new Mid-Year, Year-End (with permanent 10-day grace), Second-Year, MSD. Minto's post-move-in pages are the cleanest pattern observed.
  4. Link to Tarion's MyHome portal so buyers know where to file claims.
  5. Acknowledge deposit protection limits — current freehold tiers ($60K / 10% to $100K) and the April 2026 / Jan 2027 notice rule.
  6. Use the permitted phrasing — "Backed by the Tarion Warranty Corporation," not "Tarion-approved" or "Tarion Registered Builder."
  7. No language implying Tarion endorses the builder's construction quality.

The 2024 deposit-payout crisis ($100M+ from the Guarantee Fund) and the AG-driven 2024 CSS reforms have made Tarion coverage genuinely top-of-mind for new-home buyers.

Toronto Star investigation — Kenyon Wallace; CBC — Laura Osman

The Toronto Star has run a multi-year investigation of Tarion since 2013. Principal reporter: Kenyon Wallace. [Verified for reporter identification and headlines; verbatim Star quotes are Reported — paywalled.] (Source: Direct Star bylines; CPBH archive; CBC news index.)

Selected Star bylines (Wallace):

  • "Star Investigation: Home Buyers Not Getting The Full Picture From Protector TARION" — July 2013.
  • "Consumers Report 'Lack of Faith' In TARION's Builder Records" — July 2016.
  • "Ontario Corporation TARION Spends Millions In Salaries, Advertising, Conferences" — October 2016.
  • "Tarion facing 'largest claim event' in its history as builders walk away from projects — and home buyers lose deposits" — Feb 28, 2024.
  • "Tarion says it's reformed. These homeowners disagree" — May 25, 2024.
  • "A baffling 'loophole' — He was denied a warranty for his new house because its alleged problems left it too incomplete to qualify" — Nov 8, 2024.
  • "Tarion proposal that would penalize pre-construction buyers is fatally flawed" — Nov 11, 2024.
  • "Tarion deposit payout expected to hit $80 million for 2024 — the highest in its history" — Mar 13, 2025.

CBC Tarion reporting: Most-cited bylines are by Laura Osman:

  • "Tarion failing homebuyers, auditor finds" — Oct 30, 2019.
  • "Government promises 'complete overhaul' of Tarion home warranty" — Dec 6, 2019.
  • "Homeowners, advocates call for end to Tarion monopoly" — Jan 23, 2020 (former Tarion director of enforcement David Roberts said employees were offered incentives not to issue payouts).

CBC Marketplace: has covered Tarion-adjacent stories (TerraceWood/Meaford lawsuit Dec 2021; Dexter McMillan cheat-sheet Sep 25, 2024 with Tarion's Andrew Donnachie acknowledging the $300K cap may not cover full rebuild). No dedicated stand-alone Marketplace episode on Tarion was identified.

Correction noted: A pre-research assumption named Robert Cribb as the Tarion lead; Cribb is a Star investigative reporter but focuses on offshore tax evasion, child exploitation, environmental threats — no Tarion bylines confirmed. The correct attribution is Wallace.

CPBH critique — monopoly, NDAs, self-regulation, caps

Canadians for Properly Built Homes (CPBH), led by president Dr. Karen Somerville, has been Tarion's most consistent organized critic since 2004. [Reported — CPBH positions are accurate as to CPBH's views; they represent one side of a contested debate.] (Source: https://canadiansforproperlybuilthomes.com/; Somerville testimony to Standing Committee Jan 21, 2020; Toronto Star May 25, 2024.)

Core positions:

  • Tarion's monopoly should be replaced with a multi-provider model per the Cunningham Review.
  • Conciliation, mediation and timelines still favour builders even after the 2024 CSS reforms.
  • Tarion mediation often requires homeowners to sign non-disclosure agreements, preventing independent evaluation of how often Tarion settles and on what terms.
  • The LAT process leaves self-represented homeowners outmatched against Tarion and builder counsel.
  • Maximum payout caps (now $400K freehold) are often insufficient to remediate serious construction defects.

Somerville on the 2025 HCRA AG report: "We see this as a scathing report — a totally unacceptable situation — but unfortunately not surprising." (See Auditor General 2025 report on HCRA: 99%+ approval rate (including 2,026 of 2,042 who failed credit), 1,526 complaint backlog, 419-day avg close.)

Self-regulation critique

CPBH's broader critique focuses primarily on new-home warranty regimes (Tarion in Ontario) — but its core argument applies by extension to programs like RenoMark. The argument: Consumer-protection mechanisms run by the industry being regulated suffer from inherent conflicts of interest. Industry-run marks tend to under-enforce against their dues-paying members. [Reported — CPBH is an advocacy organization, editorially honest about its position.]

Adjacent evidence the critique points to:

  • Toronto Life "Bad Builder" investigation (Toronto contractor Mike Borac, 2023–2024).
  • Adam Gardin 2019 case — large-dollar renovation fraud in jurisdictions with HCRA, BILD, and RenoMark all active.

These cases demonstrate that even with all three signals in place, large-dollar renovation fraud continues. The credibility argument: citing CPBH is a way to surface critical perspective without sounding partisan — they are the named, on-the-record consumer advocate Ontario media goes to. Pair with the 2019 AG audit (Tarion 2019 Auditor General Special Audit (Bonnie Lysyk) — 65% of conciliations found builder at fault, 9,700 dismissed for missed deadlines (1,300 by 1 day), OHBA "disproportionate influence") for the strongest combination of advocacy + government-source critique.

Related research and further reading

For the full 2026 research brief that consolidates all of the above into one document, see Research brief: Tarion Warranty Corporation — definitive reference (May 2026). For the post-May 2024 Customer Service Standard claim-form mechanics (Initial 40-day, Mid-Year, Year-End with permanent 10-day grace, Second-Year, MSD), see Tarion claim forms post-May 2024 CSS reform — 40-day Initial, new Mid-Year, Year-End (with permanent 10-day grace), Second-Year, MSD. For the 2019 Ontario Auditor General special audit of Tarion (the 65% finding, the 2,700 PDI-defect denials, governance reforms), see Tarion 2019 Auditor General Special Audit (Bonnie Lysyk) — 65% of conciliations found builder at fault, 9,700 dismissed for missed deadlines (1,300 by 1 day), OHBA "disproportionate influence".

Sources and confidence

Raw JSON: /api/kb/tarion-warranty