Tarion is the independent non-profit organization that administers Ontario's mandatory new home warranty program. Every newly built home in Ontario, whether freehold or condominium, must be enrolled with Tarion before it can be sold, and the warranty provides protection against construction defects for up to seven years after the buyer takes possession.
The warranty is structured in three coverage periods that begin on the date the buyer takes possession. The one-year warranty covers defects in workmanship and materials, unauthorized substitutions of finishes specified in the purchase agreement, and violations of the Ontario Building Code that affect health and safety. The two-year warranty narrows its focus to water penetration through the basement, foundation, or building envelope, along with defects in the electrical, plumbing, and heating delivery and distribution systems. The seven-year warranty applies exclusively to major structural defects, meaning problems that materially compromise the load-bearing capacity or structural integrity of the home.
It is important to understand that Tarion does not perform repairs. The builder is responsible for resolving warranty issues directly with the homeowner. If the builder fails to address a valid claim or disputes coverage, the homeowner can escalate the matter to Tarion for conciliation. When a builder still does not comply after conciliation, Tarion may step in to arrange repairs or compensate the homeowner.
Before possession, the warranty also includes deposit protection. For new freehold homes priced over $600,000, deposit coverage can reach up to $100,000. For new condominium units, deposits must be held in trust under the Condominium Act, and Tarion provides a secondary layer of protection up to $20,000 if those trust provisions fail. As of April 1, 2026, buyers of new freehold homes are expected to register their purchase with Tarion within 45 days of signing the agreement of purchase and sale to qualify for maximum deposit coverage.
Builder licensing is handled separately by the Home Construction Regulatory Authority, known as the HCRA, which maintains the Ontario Builder Directory. Before signing any agreement for a new-build home, buyers should confirm their builder is licensed and in good standing through that directory. The Tarion warranty coverage stays with the home for its full duration, so even resale buyers of homes under seven years old inherit any remaining protection. If you are purchasing a pre-construction condominium, it is also helpful to understand what interim occupancy fees are and how they work in Ontario.
