Appendix D – Trends

New homes under warranty

Trend number 1: Total number of new homes registered under warranty remains high

Chart A depicts a line graph that illustrates the total number of homes under warranty versus the number of new homes enrolled in the warranty program in a given year from 2011 to 2015. The graph shows that in 2011 there were 399,374 homes under warranty and 58,610 new homes enrolled; in 2012 there were 382,755 homes under warranty and 60,932 new homes enrolled; in 2013 there were 371,939 homes under warranty and 51,506 new homes enrolled; in 2014 there were 366,431 homes under warranty and 49,890 new homes enrolled; and in 2015 there were 366,506 homes under warranty and 57,788 new homes enrolled.

Warranty cost

Trend number 2: Warranty costs have decreased in Ontario since 2011

Chart B depicts a line graph that illustrates the average enrolment fee by dwelling type from 2011 to 2015. The dwelling types are freehold homes, low rise condominiums and high rise condominiums. It shows that from 2011-2015, average enrolment fee is highest for freehold homes and lowest for low rise condominiums and that warranty costs have decreased for all three dwelling types since 2011.

Dispute resolution process

Trend number 3: Average number of claims, conciliation inspections and LAT decisions have been stable since 2011

Table 1: Five Year Trend Analysis of Claims, Conciliation Requests and Inspections and LAT Decisions

Year 2011 2012 2013 2014 2015
Number of homes under warranty 397,901 381,181 370,537 364,925 365,864
Number of claim forms submitted 59,423 55,464 54,206 56,312 55,974
Claim forms submitted as percentage of number of homes under warranty 14.9% 14.6% 14.6% 15.4% 15.3%
Number of conciliation requests 4,629 4,921 4,448 3,890 5,490
Number of conciliation requests as a percent of claims forms submitted 7.8% 8.9% 8.2% 6.9% 9.8%
Number of conciliation inspections conducted 980 994 1,063 1,077 1,361
Conciliation inspections conducted as percentage of claim forms submitted 1.6% 1.8% 2.0% 1.9% 2.4%
Number of LAT decisions issued 13 22 26 19 16
LAT decisions issued as percentage of conciliation inspections conducted 1.3% 2.2% 2.4% 1.8% 1.2%

Most common claims

Trend number 4: Material and workmanship (1st year) is the most common claim

"Chart C illustrates a breakdown of the dollar value of claims paid out by type from 2012 to 2015. Material and workmanship (1st year) is the most common claim in every year."

Claims paid in 2015

Trend number 5: Freehold units have the largest number and dollar amount of claims paid out in 2015

"Chart D illustrates the number of claim items paid out by dwelling type in 2015. Freehold units have the largest number of claim items paid out at 1,958 claim items. Condominium units had 223 claim items paid out and Condominium common elements had 145 claim items paid out."

Chart E illustrates the dollar amount of claims paid out by dwelling type in 2015. Freehold units have the largest dollar amount of claims paid out at $7,534,691. Condominium common elements had $2,606,868 in claims paid out and Condominium units had $674,444 in claims paid out.

Chargeable conciliations

Trend number 6: The number of homes with a claim paid out in any given year is less than the number of vendor builders issued a chargeable conciliation

Chart F depicts a line graph that illustrates the number of registered vendor builders that were issued a chargeable conciliation – a consequence given by Tarion if it is decided that a conciliation could have been avoided had the builder honoured their obligations - versus the number of homes with a claim paid out from 2011 to 2015. A conciliation is the process whereby Tarion determines whether a disputed item is covered by the warranty and whether repairs or compensation are required. For all years, the number of homes with a claim paid out is greater than the number of vendor builders issued a chargeable conciliation. In 2011, 581 homes had a claim paid out and 218 vendor builders were issued a chargeable conciliation; in 2012, 494 homes had a claim paid out and 182 vendor builders were issued a chargeable conciliation; in 2013, 413 homes had a claim paid out and 226 vendor builders were issued a chargeable conciliation; in 2014, 419 homes had a claim paid out and 238 vendor builders were issued a chargeable conciliation; and in 2015, 522 homes had a claim paid out and 299 vendor builders were issued a chargeable conciliation.