Building a New Home?
New requirements for residential builders come into effect on December 1, 2017. Going forward, new homes in Alberta must be built by somebody with a valid licence or an Owner Builder Authorization. This will be required to register new homes and to obtain building permits for new homes.
Licensing will apply to anyone constructing new residential units, including condominiums and large multi-family homes. Individuals who want to build their own home can do so with a valid Authorization whether they choose to build with or without warranty.
How do I apply for a builder licence?
Through an online application at http.//www.builderlicensing.alberta.ca
What are the fees?
An initial application cost $600. Each renewal application costs $500.
How long is the licence valid?
One year from the date of issue, unless otherwise stated by the Registrar.
What happens on December 1, 2017?
On December 1, 2017, licensing requirements take effect for residential builders in Alberta. Going forward, builders will need to be licenced in order to obtain building permits for new homes and to register new homes.
Provisional licences will be given to builders who have been active in Alberta over the last two years and who have a good track record. This is a temporary licence that will allow builders to continue building - it will be business as usual for them. Full licence applications will also be available online on December 1.
What are the implementation timelines?
Prior to December 1st - No licence is required to issue building permits, only warranty coverage.
December 1, 2017 - Program requirements come into effect. Provisional licences are issued to existing builders in good standing.
March 31, 2018 - All builders, including those with a provisional licence, are encouraged to submit their licence application before this date.
May 1, 2018 - Provisional licences expire. All builders must have a full licence after this date in order to obtain building permits for new homes and to build new homes in Alberta.
Are there different licence types?
Yes, builders can apply for either a developer or general contractor licence.
A provisional licence will cover both classes of licence.
Is this applicable to all permit applications?
Any building permit applied for before December 1, 2017, but not issued, will be grandfathered. All new permits applied for on December 1, 2017 and onwards will require a builder licence.
Is there a public registry for the approved builders that is available for our reference?
An interim registry will list all licensed builders, and will be available at: http://municipalaffairs.alberta.ca/builder-licensing.
A full public registry will be available in the Spring of 2018.
Every new home built in Alberta is protected under warranty, thanks to Alberta’s New Home Buyer Protection Act. All new residential construction including single family homes, multi-family homes, cottages, cabins, and modular and manufactured homes will be required to show proof of warranty before a building permit will be issued. Renovations and substantial reconstructions may also require warranty coverage.
The minimum required terms of warranty coverage under the new Act will be:
- One year labour and materials;
- Two years for defects in labour and material related to delivery and distribution systems;
- Five years on the building envelope, with a requirement for the warranty provider to offer the option to purchase 2 additional years of coverage; and
- Ten years for major structural components.
Owner-builders will be exempt from the new home warranty requirement unless the property is sold within the warranty period. In that case, when the property is sold, the owner-builder must provide the buyer with warranty coverage for the remaining portion of the warranty period.
How will this affect you?
Proof of warranty and/or a warranty exemption is required prior to the issuance of a building permit. Building permits are issued by The Inspections Group and are mandatory to build a new home. If you do not have proof of warranty, then a building permit cannot be issued.
The new home warranty will cost approximately $1700 - $2000 for an average home, or less than one per cent of the average house cost.
When purchasing a home you will be able to access a public registry, which will track warranty for homes that require coverage. Information in the registry will include key warranty dates and contact information for the warranty provider as well as the amount of remaining coverage. The registry can be accessed on-line at www.HomeWarranty.Alberta.ca.
Where can you get further information?
If you have any questions with a building project, contact a New Home Warranty Compliance Officer at 1-866-421-6929. Additional information is also available at http://www.municipalaffairs.gov.ab.ca/alberta_home_warranties.cfm, which includes a link to Frequently Asked Questions about the New Home Warranty Program.
What are the penalties for non-compliance under the Act?
Penalties for failure to provide warranty are a maximum fine of $100,000 for a first offence and a maximum of $500,000 for second and subsequent offences.