For many purchasers the decision of whether to buy a new or resale home can be a difficult one. There are many advantages to buying a new home. One of the main advantages in knowing that there is a warranty when you buy new.

When you purchase a new home, the Ontario New Home Warranty Program provides for warranty coverage. The Program provides for many kinds of warranty protection. The one-year warranty will protect your home against defects in work and materials and that the home meets the requirements of the Ontario building code. There is also a two-year warranty that protects against water damage through the basement or foundation wall and defects in materials and workmanship relating to the home’s distribution system such as the electrical and plumbing system and the furnace. Finally, there is a seven-year warranty which protects against major structural defects. It is important to understand that the warranty period begins on the date of possession.

This warranty protection is not available for resale homes. However, if the resale home is not that old, there may be some warranty protection still available. In addition to the warranty protection, the warranty program provides deposit protection up to $20,000.00. Thus, if the builder of you house requires you to deposit more that $20,000.00, it is important to understand that the program will not cover you for any amount in excess of $20,000.00 if your builder goes bankrupt. You should understand that the program does not provide protection in all cases. There is no coverage for defects in materials installed by the homeowner. Nor is there coverage for normal wear and tear or shrinkage of materials after construction.

Another benefit to buying new is that a purchaser has the right to inspect the home with a representative of the builder prior to closing. This is an excellent opportunity for the purchaser to thoroughly inspect the home for obvious defects. If any defects do exist, the purchaser will list them on a special form. It is crucial that the purchaser note any defects on the form so that there is no misunderstanding at a later date. The builder should rectify defects noted on the form in a reasonable period of time after closing.

Another advantage to buying new is that today’s homes are built with more modern and cost-effective building materials. New homes also have the benefit of being built in accordance with the most modern building code and the latest technology as well. Buying new also gives the purchaser the advantage of choosing a house that suits their particular need and desires.

While buyers cannot resist the lure of a brand new home, they often make the crucial mistake of not researching the builder. It is well worth your time to ask around to determine if the builder stands behind its product. You will want to ensure that the builder will correct defects after closing in a timely manner. It is a good idea to knock on the doors of existing homeowners to determine if the builder provides decent after sales service. It is quite ironic that people will consider these things when buying a television or car, but will not make the same inquires when buying a house.

There are many publications available to aid in your research. For more information about the warranty program or the after sales service record of your builder, you may call 1-800-668-7504 or visit the web site at www.newhome.on.ca. You should also consult an experienced real estate lawyer before you sign anything.