Today’s post may be a little different than what you’re used to reading here on The Minted Mama. While pretty clothes and happy faces are usually the order of the day, today I wanted to share a very personal story about an experience my husband and I had as a young couple that I hope no one else ever has to go through. Buying a new home is both exciting and nerve-wracking, but when something goes horribly wrong – it can turn into a nightmare.

As a newlywed couple, we moved into a brand new condo that we purchased from a builder and loved it so much (the simple, modern, and care-free lifestyle suited us very well), that we decided to buy our second home during the planning stages of another new development. When we eventually moved into our larger second condo, we were really happy with the extra space it gave us – but that’s about where it ended. Unfortunately, our overall experience in this home was less than satisfactory. It began with a few delayed issues from our pre-delivery inspection, but the builder took care of these in a reasonable amount of time.

After having lived in condos for approximately four years, starting a family was on the horizon, so we decided to look for a townhome that would get us out of the sky and onto solid ground. This is where the story gets interesting…

A new construction project began just around the corner from us for a very family-friendly townhouse neighborhood that we were very interested in. The freehold development was modern and attractive, within walking distance to shops and restaurants, and at just over 2000 square feet – it was the perfect urban dwelling we were looking for. After weighing the pros and cons, we decided that this is where we wanted our next home to be and so we made our required $50,000 deposit (in three installments) and had our sights set on the future.

The townhome had a projected timeline as all new construction projects do, and because we lived so close to the development we would regularly drive by to check on the progress of our new home. After a little while we noticed that nothing was happening at the site, and it certainly didn’t take an expert to see that little progress was taking place.  We began to inquire with our sales agent about the status of the project and while we would get vague yet somewhat satisfactory answers, the reality was that those answers were purely deceptive. Eventually we were informed about serious problems with the builder and that’s when we got our lawyer involved.

To make a very anxiety-ridden story short, our builder disappeared with our $50,000 deposit and we never found out what really happened.  As a young couple and inexperienced in life, $50,000 is a lot of money to lose (really it’s a lot of money for anyone to lose), especially when you want to settle down and start a family.

You can imagine our relief when we learned that the Ontario new home warranty program would cover up to $40,000 of our deposit for the freehold town home (they also cover $20,000 on condominium deposits), and in fact we were blown away when they came to our rescue with a settlement. All new home builders must be registered with Tarion, and all new homes and condominiums must be enrolled into the warranty program by the builder, as it’s the law in Ontario. We were able to breathe such a sigh of relief when we received our money back, and couldn’t be happier that an unexpected positive outcome came from such disappointing situation.

As hard as this ordeal was for us, we learned many lessons including how beneficial the private, not-for-profit Ontario new home warranty program really is for the protection of new home buyers, and so we took those lessons with us as we carved out our future real estate plans. Are you thinking about buying your first new construction home in Ontario? Stay tuned for another blog post coming soon all about the things you need to know before signing that contract.