If you intend to buy a new house in 2015, here are some good news! An important reform of the Regulation respecting the guarantee plan for new residential buildings, expected for years now, has finally been announced by Minister Agnès Maltais.
Basically, as of October 2014, consumers will be protected by some new regulations since contractor’s associations will no longer have a monopole over the guarantees. Indeed, an independent non-profit organization will soon be set up to protect the interests of buyers for whom the purchase of a house or condo is often the largest expense of their lives!
Okay, but first, what is a guarantee plan?
It is quite simple, actually. Let’s say you want to move in a new house, but can’t because of some delays in the construction or because of defects: you are protected by the guarantee plan for new residential buildings which falls under the Régie du bâtiment du Québec (RBQ). This Plan is mandatory and guarantees the fulfillment of some legal obligations by the contractor. It applies exclusively to new buildings, especially to detached, semi-detached, row or prefabricated houses; to duplex, triplex, quadruplex and quintuplex appartments; and to condos of four units or less.
Good, what’s next ?
In fact, you should first start by asking yourself: ‘‘and prior to that?’’ as to take advantage of this guarantee one must be well informed. Marie-Claude Dufour, communications advisor for the RBQ, reminds us that it is important to closely read the brochures on the guarantee before purchasing a house, in order to become more familiar with the timelines to report a defect. She also stresses that taking possession of the property does not mark the beginning of the guarantee, the inspection does: ‘‘we recommend to the buyer to be accompanied by a specialist. Paying an extra to get the support of an expert that could detect a problem is worth it.’’
During the five-year period following the purchase of a house, it is important to remain vigilant. If an issue occurs, first contact the constructor and make sure to send a certified copy by mail or email to the guarantee plan’s administrator. Usually, the contractor will come, check out the problem and make the necessary repairs. In the case where the constructor denies the repair, the owner must then contact the administrator who will decide if the guarantee applies or not. The reform will mostly improve that last step: the administrator will no longer be in a possible conflict of interest.
For more details about the procedures, click here.
What if we buy the house before the reform of the Guarantee Plan? Will we benefit from the changes?
Well… Yes and no. An indexation of costs comes with the new plan and the coverage will be enhanced. The older buyers will not benefit from those changes, since they will not have contributed. On the other hand, they will benefit from the improvements in the system: simplification and standardization of the procedures, shorter delays, etc.
Consumers will all benefit of the change of mindset that comes with the reform of the Guarantee Plan that will no longer be managed only by constructor’s associations. With a completely redesigned board that will comprise governmental and legal representatives, contractors and consumers, conflicts of interest will be avoided. The new regulation will also grant some powers to the board to monitor contractors to force them to honour their commitments.