Every Thing From Deposits To Structural Problems

Whether you know it or not, when you decide to build a new home, there's more to it than just picking a community, picking a floor plan you like and deciding on price.

When you sign on the dotted line with a builder, it marks the start of a personal relationship that could last a decade.

To get the most out of the relationship, make sure the builder is a member of a reputable warranty program and is also a member of the Canadian Home Builders' Association-Calgary Region.

In the case of the Alberta New Home Warranty Program, which has been around since 1974, there are various levels of homeowner protection covering everything from deposit protection to structural warranties, says program president John Kozole.

As part of the service being offered, ANHWP also offers mediation, conciliation and arbitration services through a third-party process.

"The program's warranty coverage consists of four core products--deposit protection, builder performance protection for single-family homes, first-year workmanship and material warranty, and a five-year structural warranty, and an optional 10-year warranty for single-family home buyers," says Kozole, who was named to head the program following its annual general meeting in March.

"The cornerstone of who we are, though, is the range of other services for homeowners and builders that help them through the sometimes complex process of building a home."

When you buy a home from a program-registered builder, it is automatically enrolled in the program and begins the history of the relationship.

Like all relationships, the one between builder and buyer might not always be smooth.

As is the case with disputes in general, talking things out usually leads to resolution.

The more open the lines of communication are between the purchaser and builder, the quicker issues can be resolved --or avoided altogether.

"Have a good dialogue with your builder so you can make the best decision for your family," says Allan Klassen, president and operating partner for Albi Homes. "I would recommend that before starting the process of building a home, buyers have a really good understanding of what is realistic."

In many cases, there is a level of frustration for both buyer and builder when it comes to delays in construction progress caused, in part, by weather or a shortage of skilled labour --and the impact those issues will have on possession dates.

Building a quality home requires plenty of time, says Klassen.

Kozole says the warranty program exists to support homeowners and builders by providing information to help them discuss their expectations early on.

"We provide services to clarify any misunderstandings, work with builders to repair any issues, if necessary, and fill the gap in the case of a builder failure," he adds.

While the industry is working its way through this recession and the inherent downturn in the pace of construction, builders are reviewing their customer service policies and making adjustments to ensure the level of quality remains high.

They are talking with potential purchasers to understand concerns, whether it's the cost of the new home or upgrades, financing issues, or whether they will be able to sell their existing home.

Builders are willing to meet part way in trying to resolve these issues and concerns.

Ryan Ockey, president of the Cardel Group of Companies, in an earlier interview, said: "My advice? Sit down and have an honest, heart-to-heart, non-confrontational talk with your builder. If there are issues, we need to know what they are."

For buyers who continue to be frustrated with progress, or who are not getting the satisfaction they require from their builder, they can approach ANHWP.

The program has a knowledgeable staff manning its call centre to answer questions from homeowners and builders.

Call 403-253-3636 or 1-800-352-8240. Help is also available online at the website, www.AlbertaNewHomeWarranty.com.

Each year, a very small percentage of homes enrolled in the program has issues requiring the help of the program.

And as the market changes and costs associated with residential construction climb, the level of protection provided by ANHWP has had to keep pace.

"The changes were made to give buyers of single-family homes more protection, because not only has the cost of homes risen substantially, the cost of doing warranty work on them has as well, says Schuyler Wensel, who recently left his post and president and CEO of the program to return to Edmonton where he is senior civil litigator for Witten LLP. He will, though, continue to be legal counsel for ANHWP, a role he held prior to joining the program full-time a few years ago.

The enhanced warranty protection has been automatically provided to all new single-family homes for which ANHWP gets a certificate of possession dated Jan. 1 or later.

The increased level of protection covers four areas: - Deposit protection has increased to a maxi-mum of $100,000, up from $60,000. It provides buyers with the return of their deposit on a new home in the event of default by a builder member of the program. - Builder performance protection has climbed to $50,000, up from $30,000.

Homebuyers are covered for up to $50,000 (including $3,000 in legal fees) towards the completion costs, or the discharge of builders' liens in the event a builder member should fail to complete the agreement to build a home.

The program provides the administration, co-ordination and supervision of all issues for the completion of the home. - First-year workmanship and materials protection has been increased to $100,000, up from $60,000.

If a builder member does not meet its warranty obligations, the program provides up to $100,000 towards the cost of repairing defects in workmanship and materials during the first year after a homeowner takes possession. - Five-year structural integrity protection has also increased to $100,000 from $60,000.

The unused portion of the first-year materials and workmanship warranty coverage amount, up to $100,000, can also be applied to the costs of repairing major structural defects affecting the load-bearing components of the home in the first five years--or 10 years if the extended warranty has been chosen.

"I'm proud that 35 years after its founding, the program still exists to support our original intent--to encourage improved performances by the industry," says Kozole.

ANHWP has more than 750 builder members, including some of the largest single-detached and multi-family builders in the province, as well as smaller, custom home-builders.