Illegal Building in Ontario

About Home Construction Regulatory Authority:

• The Home Construction Regulatory Authority (HCRA) regulates people and companies who build and sell new homes in the province.
• As the regulator, the HCRA oversees licensing, enforces the Code of Ethics and addresses professional conduct and competency complaints of its licensees.
• The HCRA also hosts the Ontario Builder Directory, and works to curtail illegal building and selling, which is a top priority for our organization.

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About Tarion:

• Under the Ontario New Home Warranties Plan Act, new home builders and vendors must be registered with Tarion and enroll their homes in the new home warranty program.
• As part of the ONHWP Act, the Plan ensures that all consumers automatically receive statutory home warranty protection as soon as they purchase a home.
• Homeowners can be further reassured knowing that the Plan is administered by Tarion, a not-for-profit organization that operates independently from builders.

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Illegal Building is a Major Consumer Protection Issue

Illegal building is a major problem in Ontario, happening every day all over the province. It’s about building without being qualified and licensed when they should be licensed. Curtailing illegal building is the HCRA’s top policy priority.

In Ontario, there are more than 6,500 licensed builders for a population of 15 million people. Compare that to British Columbia, which has already enacted reforms to combat illegal building. That province has 25% more licensed builders for a population that is 1/3 the size of Ontario’s. Something is not in balance.

Illegal building first and foremost puts homebuyers at risk. Consumers do not get the protections that come from their builder being properly licensed and held to professional standards. This is a province-wide problem, especially for single-family homes and low-rise units, including infill developments in the cities.

Illegal building also puts licensed builders at a disadvantage. Licensed builders have invested time and effort to demonstrate that they can build safe, quality homes and are committed to treating purchasers fairly. Illegal builders have not made these investments. This is a province-wide problem, especially for single-family homes and low-rise units, including infill developments in the cities.

Illegal builders are exploiting a loophole to sidestep the laws and rules that protect consumers. These builders pretend to build for their own use, only to flip the homes shortly after. Or they dupe consumers into hiring them as a cheaper option by saying they’re not builders but just managing the project – with the homeowners on the hook for all sorts of construction risks.

An unlicensed builder hasn’t met the technical competency requirements. It isn’t accountable for its conduct under a code of ethics. And it doesn’t provide the warranty coverage that is there to protect Ontarians making the largest purchase of their lives.

In addition to illegal builders being bad for consumers and unfair to licensed builders, dealing with unqualified contractors is an outsized burden on municipal inspectors and a drain on government revenues as illegal builds are a significant part of the underground economy.

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About Peterborough & the Kawarthas Home Builders Association

Peterborough & the Kawarthas Home Builders Association (PKHBA)is committed to providing education and resources to our members ensuring our buildings are always providing the best services to their clients. PKHBA also checks on the licensing and liability status of member companies annually, giving home buyers and home owners peace of mind.