Module 4 Flashcards
Infill lot
development occurs in a built-up neighbourhood
Provides additional housing stock by using existing services rather than developing vacant land
intensification
Permits required for urban lot w a structure
demolition and building permit
Does the prop have a sufficent frontage and area to be divided into more than 1 lot?
infill redevelopment and severance
covers construction, C.C.E, sub of matierals, deposit protection
provinical warranty
Homes covered under warranty program must be enrolled before
construction
Homes not covered under warranty program
previously occupied, built by owner & seasonal homes
Alterations, deletions or additions made by owner, normal wear and tear, material shrinkage
not covered by warranty program
Representation agreements must end
on a specific day
builders will use this to establish a listing price (buyer can negotiate additional upgrades @ time of offer)
Standard package of finishings
Speculative (Spec) Homes
properties where construction has begun without a buyer in mind
Only the foundation, framing, roof and window, no finishes has been constructed
partially constructed home
interior and exterior finishes have been completed but not all of the construction (last items-cabinets, bathroom fixtures, flooring)
mostly constructed home
Ontario new home warranty plan applies to deposits by protecting the buyer from
builder not completing due to bankruptcy, break
Ontario new home warranty plan coverage for deposits
sale price 600k = up to 60k
Sales price > 600k: 10% of sale + up to 100k
If the closing date is extended, terms of a mortgage commitment may not be
honoured because the commitment has expired
Standards and finishes sheet
used to market the development
If the builder is willing to pay remuneration, a SP will have to introduce & register
the buyer prior to or during the first visit to the new development
Salesperson should register their buyer w/ builder when they 1st visit the sales office or
builder will not pay comission
Construction loans are typically
short-term, high interest loans
- Most common type of construction loan
- lender pays the builder “draws” at various phases (ranges from 3-5)
Progress Draw Mortgage
Take-out mortgage
once construction is completed and is verified by the appraiser this is organized
When acquisition and construction costs are rolled into a final mort. that has favourable interest rates and less risk for lender bc it is a finished product
Take-out mortgage
Deposits are higher than resale homes
homes purchased from plans
Lien claimant can only register a claim for the value
of services/materials supplied
must be registered at LRO, be verified by affidavit
liens
Must be registered within 50 days of specified events
lien
Prevents transfer of ownership between seller or buyer unless specified amount is paid
lien
Lien process gives trades people
added security of payment
Individual lien
applies to persons providing services or materials (concerns 1 premises)
general lien
when the work is conducted on several premises
Each payer on a contract must retain a 10%
holdback of the price of services/materials under the contract until the period where liens have expired, satisfied or discharged
Basic holdback
10% of the price of all services/materials
Basic holdback is held until the
oppotunity for all liens to be claimed under the act has expired
Finishing holdback
payer under the contract can retain a seperate holdback of 10% of the price of the remaining services or materials until all liens that may be claimed have been satisfied
A lien is not effective until
the owner is notified
Tarion coverages is broken down into
1,2, and 7 year segments
Buyers of newly constructed homes have coverage relating to
deposits, delayed closing and substitutions
Homes must be enrolled in Tarion
before construction
(Tarion) SPs must asked builders for their
registration number and home’s enrolment number
Warranty period begins at for new houses/condo common ele
date of possession/date of condo registration
Forms used for warranty
30 day form (used after first 30 of posesssion) and year end form (outstanding warranty items), second year form, major structural defect form during 3rd year
- Requires home is free from defects in workmanship and materials
- Home is fit for habitation, meets OBC
1 year warranty coverage
Covers:
- Water penetration (basement, foundation)
- Defects in materials and work
- Violation of OBC
Two year warranty
Covers major structural damage and defects in work or materials that result in significant damage (failure of a load bearing wall)
7 year warranty
Information of available warranty is found in
the certificate of posession and completion
Condo common ele coverage is based on a formula of
50k x # of units (max of 2.5 mil)
All warranties apply to a condo conversion project except for
1st year workmanship warranty on preexisting elements
Builders can only subtitute items when they are of
equal or better quality
Max warranted damage caused by environmentally harmful substances or hazards
$15k
Max warranty coverage for septic systems
$25k
Pre-delivery inspection
Builder & buyer tour the new house and list any defects in order to ensure they are repaired
Purpose of a Pre-delivery inspection
Important step to obtaining certificate of completion and possession (indicates day warranty will begin)
Provision must be included that every APS has this package delivered on or before date of PDI
Homeowner info package
Homeowner info package details
buyer’s provincial warranty rights
After PDI buyer and builder must
complete certificate of completion and possession/warranty certificate and PDI form
For condo units PDIs are conducted a few days prior
to the date set for interim occupancy
certificate of completion and possession signals start
of warranty protection
Builder must submit the certificate of completion and possession
within 15 days of posession
Builder will remove a warranty sticker from the
CCP and place it on the electrical panel
