How many times have you heard this: homeowners are too picky or better yet homeowners expect too much? Being a part of the residential industry I hear it all of the time, but really who is at fault for the higher expectations? It just can’t be homeowners suddenly demanding the best product for the cheapest price, as I have been quoted in the Edmonton Journal as saying this is the single most expensive purchase a person will ever make in their life. I’m sure that must have something to do with it, but that can’t be the only reason. How about the Builders themselves I’m sure they aren’t doing anything to drive this “I want a perfect home” atmosphere, because the Builders can never be at fault, they always are doing what’s right. Isn’t that the image you get from the industry? I certainly do.
I think part of the problem might be the amount of “fly by nighters”: Builders or people who say they are Builders to be more correct, that have cropped up over recent years. As a former building inspector I’ve seen too many disasters being built, its scary walking into many of these homes. I couldn’t imagine being a first time homebuyer not knowing what is good and what isn’t and having to trust the builder who by day is a taxi cab driver and by night is a Builder. It for sure hurts the industry.
Builders who have no business building definitely do play a part in this but not as much as you would think. What about the advertising that the Builders use, or their slogans, might this be the driving force behind the perfect home? I recently did a Google search just to see what Builders are saying about themselves, what their slogans are and how it influences the market place. I picked 10, in fact my favourite 10. In no particular order:
- The Key to Your Dreams
- We Set The Standard, Then Exceed It
- Quality is Paramount
- From Your First Home to Your Dream Home .... Expect to be Impressed
- Dedicated to Building Homes of Excellence
- There is a Difference
- Like No Other
- Where Building Homes Becomes an Art
- We Don’t Meet The Standard, We Set It
- Still Setting The Standard
I worked for one of these 10 Builders, whose quality must be so good because their catch phrase says so. Don’t believe the hype. This Builder cared so much about the potential homebuyers that when I brought it to their attention that there were code violations that needed to be addressed the Owner and the General Manager told me to leave it until we got called on it by the Municipal Inspector. Hmmm, intentionally breaking the Alberta Building Code, does anyone else see something wrong with that? I did not stay with that Builder very long, my standards are much higher than that, plus it’s called integrity, some of these Builders should look into the meaning of that word.
In advertising you can get yourself into trouble for misleading the public, under the Alberta Fair Trading Act under Chapter 2 Section 6 Subsection 4 – Without limiting subsections (2) and (3), the following are unfair practices if they are directed at one or more potential consumers: Paragraph (a) a supplier’s doing or saying anything that might reasonably deceive or mislead a consumer. Paragraph (e) is even better, it states: a supplier’s representation that a goods or service are of a particular standard, quality, grade, style or model if they are not. It’s written into law that they can’t deceive you, so is a homeowner being too picky when the Builder advertises that they are “Dedicated to building homes of excellence”, how can they be when that’s the message the Builder has sent.
The expectations of a homeowner fall directly on the shoulder of the Builder and when the homeowner is told they will be delivered a superior product only to find out that their home is an industry standard built home they have every right to be upset.
Saturday, August 6, 2011
Tuesday, July 12, 2011
Mandatory Warranty - Will it Better Protect Albertans?
Long-awaited protection for buyers of new homes is finally coming to Alberta, says the Minister of Municipal Affairs Hector Goudreau, he is looking at making new-home warranties mandatory in Alberta.
Great news....or is it? Will it make the residential industry better, or add protection to the homeowner as Mr. Goudreau claims? Not a chance. So then why would the government introduce legislation that will make home warranty mandatory in Alberta, there has to be a bigger picture here somewhere. How does mandatory warranty better protect the consumer when 95% of the Builders provide warranty already? Most homeowners cannot buy a home through their lending institutions unless the home is protected by warranty so the Builders voluntarily enrol with a warranty provider. So who benefits from mandatory warranty, it doesn’t help the Builders, it doesn’t help the homeowners so who will it protect? The only logical answer is the government itself. In 2008 a report was created called the Building Envelope Survey, a report that the government shelved. This report outlined major issues in the building industry, more specifically how our poor building practices in Alberta help contribute to the building envelope issues.
According to the Province of Alberta’s Fair Trading Act the Builder of a residential home is protected under the act if they are enrolled with a warranty provider, you legally cannot file a complaint against that Builder. Suing a Builder is almost out of the question and Builders know this, the President of a home builder I formerly worked for could often be heard saying “let them try and sue me, we’ll see who has deeper pockets”. That’s their attitude - let them try. It’s inconceivable that someone would take on the government over issues with their home but to ensure no one will the government will introduce legislation making warranty mandatory and according to the Fair Trading Act who will be held responsible.....the warranty provider.
Making warranty mandatory keeps the best interest of the Government of Alberta in mind and no one else. The government knew about issues with the building envelope of a new home back in 2002, nine years later there has still been no changes to the Alberta Building Code to address these issues. Making warranty mandatory will magically take care of these issues, please, there has been warranty in this province since 1974 and there are still major issues in this industry. So all of us Albertans who have been patiently waiting for protection our long-awaited answer is finally here, thanks Hector.
Great news....or is it? Will it make the residential industry better, or add protection to the homeowner as Mr. Goudreau claims? Not a chance. So then why would the government introduce legislation that will make home warranty mandatory in Alberta, there has to be a bigger picture here somewhere. How does mandatory warranty better protect the consumer when 95% of the Builders provide warranty already? Most homeowners cannot buy a home through their lending institutions unless the home is protected by warranty so the Builders voluntarily enrol with a warranty provider. So who benefits from mandatory warranty, it doesn’t help the Builders, it doesn’t help the homeowners so who will it protect? The only logical answer is the government itself. In 2008 a report was created called the Building Envelope Survey, a report that the government shelved. This report outlined major issues in the building industry, more specifically how our poor building practices in Alberta help contribute to the building envelope issues.
According to the Province of Alberta’s Fair Trading Act the Builder of a residential home is protected under the act if they are enrolled with a warranty provider, you legally cannot file a complaint against that Builder. Suing a Builder is almost out of the question and Builders know this, the President of a home builder I formerly worked for could often be heard saying “let them try and sue me, we’ll see who has deeper pockets”. That’s their attitude - let them try. It’s inconceivable that someone would take on the government over issues with their home but to ensure no one will the government will introduce legislation making warranty mandatory and according to the Fair Trading Act who will be held responsible.....the warranty provider.
Making warranty mandatory keeps the best interest of the Government of Alberta in mind and no one else. The government knew about issues with the building envelope of a new home back in 2002, nine years later there has still been no changes to the Alberta Building Code to address these issues. Making warranty mandatory will magically take care of these issues, please, there has been warranty in this province since 1974 and there are still major issues in this industry. So all of us Albertans who have been patiently waiting for protection our long-awaited answer is finally here, thanks Hector.
Don't Use a Builders Lawyer.
Most Builders will offer their lawyers services and cover the legal fees for you, so why would I possibly not want a homeowner to take advantage of that and save the money? Warranty Smarts is about keeping the best interests of the homeowner a priority so even though you will save that money - the lawyer works for the Builder and the Builders interests will always be at the forefront. I’m going to reveal an industry secret because I know many are wondering why the Builder would offer that service, it’s very simple, it’s to ensure they get payment for the home at the time of the possession walk-through.
Something that every potential homebuyer needs to understand is that they need to protect themselves, it doesn’t matter who the Builder is in this industry. The best or the worst Builder will take every precaution to ensure their interests are always protected. A Builder has carried most of the cost of your new home through-out the build so when the possession walk-through occurs and if things go bad how is one way to guarantee that they will receive their money? By having the homeowners use the Builders lawyer that’s how. The morning of the possession walk-through the Builder sends a letter called a “Substantial Completion” document to their lawyer, this document is telling the lawyer that the home is completed to an acceptable level and it is okay to release the funds. Their lawyer is not going to question this and they release the funds to the Builder. By the time you start the possession walk-through your funds have already been transferred. This is one way of many that a Builder uses to protect themselves from a homeowner.
If you find yourself in a similar position where on the possession walk-through your new home is a disaster and you used their lawyer meaning the funds have already been transferred leaving you no leverage, and yes this happens in the industry, there is only one thing you can do at this point and that’s to sign the Certificate of Possession to start your warranty. Many people do not understand that the warranty on your home does not start until the Certificate of Possession is signed after the possession walk-through. Once the Certificate of Possession is signed by you and the Builders representative your warranty becomes legal, you can now file for Conciliation with the warranty provider.
Using a lawyer that you have hired that is independent of the Builder ensures that you will have that leverage available to you on possession day if things do go sideways. To me this is the best tip I can give a potential new homebuyer, because it’s not just about the possession day. There are many times when the relationship falls apart after possession and you will require the advice of your lawyer, but if you used the Builders lawyer when you call for advice they will tell you they are under retainer to the Builder. So any time that you have put into building the client – lawyer relationship was a waste of your time.
Remember these words, Protect Yourself.
Something that every potential homebuyer needs to understand is that they need to protect themselves, it doesn’t matter who the Builder is in this industry. The best or the worst Builder will take every precaution to ensure their interests are always protected. A Builder has carried most of the cost of your new home through-out the build so when the possession walk-through occurs and if things go bad how is one way to guarantee that they will receive their money? By having the homeowners use the Builders lawyer that’s how. The morning of the possession walk-through the Builder sends a letter called a “Substantial Completion” document to their lawyer, this document is telling the lawyer that the home is completed to an acceptable level and it is okay to release the funds. Their lawyer is not going to question this and they release the funds to the Builder. By the time you start the possession walk-through your funds have already been transferred. This is one way of many that a Builder uses to protect themselves from a homeowner.
If you find yourself in a similar position where on the possession walk-through your new home is a disaster and you used their lawyer meaning the funds have already been transferred leaving you no leverage, and yes this happens in the industry, there is only one thing you can do at this point and that’s to sign the Certificate of Possession to start your warranty. Many people do not understand that the warranty on your home does not start until the Certificate of Possession is signed after the possession walk-through. Once the Certificate of Possession is signed by you and the Builders representative your warranty becomes legal, you can now file for Conciliation with the warranty provider.
Using a lawyer that you have hired that is independent of the Builder ensures that you will have that leverage available to you on possession day if things do go sideways. To me this is the best tip I can give a potential new homebuyer, because it’s not just about the possession day. There are many times when the relationship falls apart after possession and you will require the advice of your lawyer, but if you used the Builders lawyer when you call for advice they will tell you they are under retainer to the Builder. So any time that you have put into building the client – lawyer relationship was a waste of your time.
Remember these words, Protect Yourself.
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