When buyers buy a completely new home, conflicts frequently arise between the buyers and builders. These conflicts generally concern building defects, delay in business projects, or changes in contract dates and prices.
[two]The reality of the situation is that the relationship between buyers and builders can be a lengthy one, sometimes lasting up to 3-5 years. Since all parties involved generally want this to be a pleasant and a positive experience, this blog will talk about the ways that people can minimize the likelihood of this sort of conflict occurring, namely, by discussing the things that buyers should be on the lookout for, prior to selecting a builder.
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The builder of a home is usually a general contractor who hires “subcontractors to complete various tasks when building a home”. “A foundation subcontractor pours the foundation, a framing company builds the structure, a plumbing company is hired to install plumbing, a roof company installs the roof and etc.” This means that a lot of the work is actually not done by the builder himself, but by other companies who are hired by the builder. The builder actually only gets to decide on the floor plan and “on how much or how little to spend on the building of a home”. The builder can choose to hire subcontractors who are known to do fine work of craftsmanship and are somewhat costly, or choose to hire those who build homes in the least expensive way possible. When selecting who to hire, builders often respond to the condition of the market. If the market is strong, they are able to opt for the cheaper construction method, because they know it will sell regardless. When the market is weaker however, they tend to spend more “on fancier touches, as a way of enticing buyers”.
If you are buying a brand new home, “who the builder is matters quite a bit” because they will either make this a positive or a negative experience. Here are some things buyers should look out for, or should look into, prior to choosing a builder.
Buyers should do research on a builder, before simply settling on them. In Ontario, “all builders must be registered with Tarion Warranty Corporation”. Tarion “regulates new homebuilders and administers a warranty program for newly built homes”. All builders are required to register a new house or condo with Tarion before starting a new construction. All builders registered under Tarion have “completed technical tests based on the Ontario Building Code, and meet the financial qualifications set by Tarion”. Buyers should check the “Ontario Builder Directory” to see if “the builder is registered with Tarion, how many homes they have built and where these homes were, and if Tarion has had to resolve warranty claims for a builder in the past 10 years”. Checking if the builder is registered with Tarion can save the buyer from dealing with legal/warranty issues, and in general, can give buyers a better idea if the builder they are looking into is the kind of builder they would want to be doing dealing with for an extended period of time.
To find out more about who the builder is and if past clients were satisfied with the services they provided, buyers should ask to see customer references and testimonials, ask to directly speak to past clients, or search for reviews online. Buyers should also ask to see the builder’s portfolio, to get an idea if they have expertise in the type of home they are interested in having built. Touring the builder’s model homes is also essential, because it will give the buyer a firsthand look at the type of work the builder does and the quality of work they provide.