Tarion’s Record Payouts: What It Means for Buyers & Sellers
Ontario’s new-home consumer protection agency, Tarion, expects to pay out over $90 million in deposit claims this year—the largest payout in its history. This surge is due to more builders failing to deliver homes, project cancellations, and illegal sales.
Why is This Happening?
Rising construction costs, high interest rates, and builder insolvencies have led to more projects entering receivership. Some developers simply walk away, leaving buyers without a home and scrambling to recover their deposits.
Buyers—How This Affects You:
- Increased Risk: More builders are failing, making it crucial to work with registered, reputable developers.
- Deposit Protection Limits: Buyers of homes over $600K can only claim up to $100K back—which may not fully cover their losses.
- Delays & Uncertainty: Even with deposit protection, receiving funds takes time, delaying your homeownership plans.
Sellers—How This Affects You:
- Lower New Home Inventory: With fewer builders completing projects, demand for resale homes may increase, benefiting sellers.
- Buyer Hesitation: Some buyers may pause purchases, worried about market instability—pricing your home competitively is key.
- More Cautious Lending: Banks and lenders may become stricter with financing due to builder failures, impacting buyers’ purchasing power.
What’s Next?
- Tarion is tightening its builder regulations and improving deposit tracking to reduce future losses. But for buyers, due diligence is more important than ever.
Original article: https://www.ctvnews.ca/toronto/article/new-home-consumer-protection-agency-in-ontario-could-face-90m-in-claims-as-developers-walk-away-from-projects/
