Is There a New Home Warranty in Nova Scotia? What Buyers Should Know

Buying a newly built home feels safer than buying a resale house. Everything is new, so you may assume that a defect will be fixed at the builder's cost. In Nova Scotia that assumption is not always correct, and it is worth checking before you commit.

This article explains whether a new home warranty is required, what to look for if one is offered, and what to do if the builder has none. It is general information, not advice on your own purchase.

This article covers the law of Nova Scotia.

Does Nova Scotia require a new home warranty?

CMHC states that a new home warranty is not required by law in Nova Scotia for condominiums. How this applies to a house depends on your situation, so it is worth confirming with a lawyer. Some builders choose to offer a warranty, or they provide one through a third-party home warranty program.

In practice, this means the warranty is something you have to look for. A builder may advertise one, may mention it only in passing, or may not offer one at all. Whether a particular house or condo unit has coverage depends on the builder and the contract, so confirm it in writing rather than relying on a conversation or a brochure.

What coverage under a warranty program may look like

Warranty programs differ from one another, and the details of any one program are set by its own documents. The terms that matter most are usually found in the warranty certificate or booklet, not in the sales material. Coverage details for specific programs are worth reading line by line, and a lawyer can help you understand how they fit with your purchase agreement.

When you read the document, look for these points:

• What is covered, and for how long each type of coverage lasts.
• What is excluded, such as normal wear, damage you cause, or items the builder did not build.
• How to make a claim, who you notify, and any time limits for doing so.
• Whether the coverage stays with the home if you sell it.
• Who actually stands behind the promise: the builder alone, or a third-party program.

If the builder says there is a warranty, ask for the actual terms before you sign, not afterwards.

Questions to ask your builder before you sign

• Is a warranty included, and is it the builder's own or through a third-party program?
• Can I see the full warranty document now, before I sign the agreement?
• Is the warranty written into the agreement of purchase and sale, so it is part of the deal?
• What happens if the builder closes the business or cannot be reached?
• Is the price shown with or without HST, since HST is paid on new units but generally not on previously owned ones, although resale buyers may owe the federal portion in some cases?

Write down the answers and ask for them by email. If something important is promised only verbally, ask for it to be added to the agreement.

If there is no warranty

If the builder offers no warranty, you are not automatically left without options, but your protection depends more heavily on what you negotiate and what you check yourself. Having a lawyer review the agreement before you sign is a sensible step.

• Ask the builder to put any repair promises in the contract in writing, including what will be fixed and by when.
• Ask whether the builder will provide a written warranty of their own, and what it covers.
• Think about hiring an independent home inspector before closing, where the timing allows.
• Keep copies of plans, change orders, receipts and every email with the builder.
• Ask a lawyer how your agreement handles defects found after closing.

Whether you could claim against a builder for a defect depends on the facts and the contract. That is a question for a lawyer, not something this article can answer.

New condominiums have a few extra protections

If you are buying a new condo unit from the declarant, there are some separate rules. You have ten days to rescind if the documents materially affect your enjoyment of the property and the vendor will not fix or waive the issue. Rescission must be in writing and in the vendor's hands within that ten-day cooling-off period.

On new developments, the developer's lawyer holds in trust money equal to 10 percent of the budget from the first unit's sale, so the corporation can claim if first-year costs exceed the budget by more than 10 percent. This is about the condo corporation's finances, and it is not a warranty on your unit.

What to do next

Before you sign, get the warranty terms or confirmation that there are none, and have a lawyer review the whole agreement. If you have already signed, still ask for the documents and keep every record. A lawyer can tell you how your specific contract treats defects, deposits and closing.

Frequently asked questions