Purchasing a brand-new cottage is a big decision. Whether you’re an experienced buyer or looking to invest for the first time, having trust in your builder is essential for a smooth and successful buying experience.
Since 2021, the Home Construction Regulatory Authority (HCRA) has been responsible for regulating and licensing builders of new homes—including new all-season cottages—in Ontario.
“If you’re hiring a builder to build your cottage, make sure they are licensed by the HCRA. When you work with an unlicensed builder, you may have little protection if things go wrong,” says Wendy Moir, CEO and Registrar at the HCRA. “Licensed builders are required to follow industry rules and standards, including the Ontario Building Code.” This means added protection, and more peace of mind, for you as a buyer.
Whether you’re looking to purchase new or build a custom cottage, here’s what you should know before choosing a builder.
What is the HCRA’s role in the homebuilding industry?
In Ontario, by law, all new home builders and sellers must be licensed by the HCRA. It’s illegal to build or sell a new home in Ontario without a licence.
“The licence is an assurance the builder you hire has met competency standards to build homes and is expected to meet high ethical standards that include honesty and integrity,” says Moir.
“Our primary responsibility is to educate and protect the public, listen to their concerns, and provide useful resources so they can make informed decisions throughout the homebuying journey,” says Moir. “We hold licensed builders to professional standards and manage conduct concerns with the goal of a well-regulated and safe homebuilding industry.”
Does the person or company building my cottage need to be licensed?
Anyone building or selling a new home in Ontario needs a licence from the HCRA. But what exactly is a “new home”? While the HCRA has a technical definition, in simple terms your new cottage may be considered a new home if it meets the following characteristics:
- Is a new dwelling
- Has not been previously occupied
- Is built as a family dwelling used for residential purposes
- Is self-contained—meaning that it provides things like heating and waste management, and spaces for eating and sleeping
- Can be occupied on a year-round basis
- Is affixed to a permanent foundation
“Typically, renovations or upgrades to an existing cottage would not make the home ‘new,’” says Moir. “A key factor to consider is whether your cottage can be lived in year-round, and not just seasonally.” If a new cottage will have heating, insulation, on or off-grid electricity, a potable water supply, plumbing or other means of waste disposal, and sleeping and cooking areas, your builder would require an HCRA licence before construction.
“Even if you’re building a home or cottage on land you own, the minute you hire someone else to complete the work for you, the builder needs to be licensed by the HCRA,” says Moir.
How can I find out if my cottage builder is properly licensed?
To check if your builder is licensed, visit the Ontario Builder Directory. Hosted by the HCRA, this searchable online database provides background information on nearly 7,000 licensed builders and sellers in the province. The Builder Directory will tell you if a builder or seller is properly licensed, an important first step in your cottage-buying journey.
It will also show you the number of years the company has been active, how many homes they have built, and any conduct concerns, including charges or convictions against the builder. The directory even includes project and warranty-related data from Tarion, the organization responsible for Ontario’s new home warranty and protection program, including information about any claims it has received.
Does the Builder Directory provide warranty information even if my cottage isn’t brand new?
Most newly built homes in Ontario come with a warranty that lasts up to seven years. But what you may not know is the warranty stays with the house, not the owner.
“Even if you purchase a resale home less than seven years old, you can check the Builder Directory to see what applicable warranties remain,” says Moir. “Protection under the new home warranty is valid for seven years from the original date of possession, no matter who owns the home.” Still, she recommends that new cottage buyers contact Tarion after taking possession, to let them know about the change in ownership.
What should I do if I have a concern about the person building my cottage?
“As a buyer you should expect professional and honest behaviour from your builder. That’s exactly what happens for the most part—most builders have good relationships with their customers, act ethically, and do not break the rules,” says Moir. “But exceptions do occur. In those unfortunate cases, you can submit a complaint to the HCRA.”
Licensed builders and sellers are subject to a rigorous Code of Ethics which sets out how they are expected to operate. The HCRA enforces the Code and manages complaints about builders’ professional conduct.
Your licensed builder should treat you fairly, honestly and with integrity, and provide a level of courteous, communicative, and responsive service. They should not prevent you from filing a complaint, or engage in discrimination, misrepresentation, intimidation, or bullying.
Who do I turn to if I have a defect or warranty concern about my cottage?
By law, all new homes and cottages built in Ontario for year-round occupancy are provided with a builder’s warranty. Tarion delivers the warranty and protection program and is responsible for ensuring buyers receive the coverage for which they are entitled. If you have a defect or warranty concern about your cottage, contact Tarion for next steps.
Learn how the HCRA protects consumers on their homebuying journey at hcraontario.ca and follow them on Facebook @hcraontario.