Understanding 2-5-10 New Home Warranty BC
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by Richard Morrison
- January 10, 2020
- Buying
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Buying a new home is an exciting milestone in life. But amidst choosing finishes and decorating, it’s easy to overlook important details like warranty coverage. When buying a new home in British Columbia, it’s crucial to understand the 2-5-10 warranty standard. This coverage can provide peace of mind against unforeseen defects. Let’s examine what the 2-5-10 warranty includes, when it starts, exclusions, inspection tips, and how to make warranty claims if issues arise.
Breaking Down 2-5-10
The “2-5-10” terminology refers to coverage timeframes for different elements:
- 2 years for defects in materials and labor
- 5 years for the building envelope
- 10 years for structural defects
Within the initial 2 years, coverage includes:
- Electrical systems
- Plumbing
- HVAC (heating, ventilation, air conditioning)
- Exterior cladding
- Windows
- Doors
- Any code violations
- Defects making the home uninhabitable
Detached homes have 12 months coverage for non-common areas, while strata corporation common areas get 15 months.
The 5-year envelope term covers unintended water penetration and resulting damage. This includes foundations, walls, windows, doors, and roof.
Finally, the 10-year structural coverage is for major failures like sinking footings or load-bearing collapses that affect occupancy.
Having a high-level overview is useful, but it’s also important to dig into your specific policy. Some providers exceed the minimums mandated under the 2-5-10 legislation.
When Does Your Coverage Start?
The warranty time clock starts ticking at occupancy permit, title transfer, or move-in – whichever comes first.
For detached homes, it’s occupancy or title transfer to the initial purchaser. With strata units, coverage starts at occupancy or title transfer for the individual unit. For common areas, it’s the earliest move-in or title transfer in the entire building.
Having the exact dates documented is essential to know when your coverage periods expire.
What’s Excluded from The 2-5-10 Warranty?
While the 2-5-10 warranty provides robust coverage, some exclusions do apply:
- Landscaping
- Municipal services
- Wear and tear
- Owner negligence or improper maintenance
- Pre-existing defects from before warranty commencement
- Detached structures
- Commercial spaces
- Septic systems
Exclusions for “acts of God” like floods and earthquakes also exist. Again, check your specific policy wording to see exclusions and limitations.
Inspect Before Your Warranty Expires!
I always advise clients to hire a qualified home inspector to examine their residence before 2-5-10 warranty periods lapse. We once had first-time homebuyers discover substantial water damage just a few weeks after their 5-year building envelope term ended. It was incredibly frustrating for them to have missed the warranty deadline by such a slim margin.
Tips for Reporting Covered Home Defects
If you do find a warrantable issue, here are some tips for reporting it properly:
- Document the defect thoroughly in writing, accompanied by date-stamped photos. The more detail, the better.
- Formally notify your builder and warranty provider in writing. Keep copies!
- For proof and timeliness, use registered mail or a process server.
- Don’t wait until the last minute – claims can take weeks or months to investigate and resolve. You want to allow adequate time.
Is Extended Coverage Worth It?
Some builders offer extended warranty products that go above the minimum 2-5-10 required by law. This additional coverage can provide added peace of mind, especially on expensive homes where repairs may be costly.
I’ve seen extended warranties become lifesavers for clients who purchased homes with known issues like leaky condos. Even if you pay a bit more upfront, avoiding massive repair bills down the road can be well worth it.
Did you know over 80% of homeowners say they’d purchase extended coverage if offered according to a survey by Richard Morrison? In my experience as a realtor, homeowners rarely regret having too much coverage. But they often wish they had more once problems arise!
Use Your 2-5-10 as a Safety Net
While no one likes to think about defects cropping up in a new home, it pays to educate yourself on the 2-5-10 warranty as a safety net. Learn what your policy does and doesn’t cover, document any issues thoroughly, and inspect before key expiry dates. A few proactive steps can help you feel fully confident in the quality of your new home for years to come.
In summary, BC’s 2-5-10 new home warranty provides defined coverage timeframes for different construction elements. Know what’s covered and when, document potential defects properly, and inspect at key intervals. Stay on top of your warranty protections and avoid frustrations down the road. Your 2-5-10 coverage is there to give you peace of mind in your new home.
FAQs
Q: What is 2-5-10 Home Warranty and what does it cover?
A: The 2-5-10 Home Warranty is a mandatory warranty program for newly built homes in British Columbia. It provides coverage for major structural defects, defects in materials and labour, and violations of the Building Code that may lead to detachment or material damage to the new home for a period of two years from the date of first occupancy or ten years from the date of transfer of legal title to the first owner.
Q: Who provides this home warranty insurance?
A: This home warranty insurance is provided through BC Housing’s Homeowner Protection Office (HPO), with private insurance companies offering policies on behalf of HPO.
Q: What type of homes are covered under this 2-5-10 new home warranty?
A: The 2-5-10 new home warranty covers single family detached homes, duplexes and townhouses. It also covers stratified condominiums, manufactured homes, custom homes and homes intended for non-residential purposes.
Q: How do I purchase a new home with 2-5-10 New Warranty?
A: All residential builders who build single family detached homes, duplexes, townhouses or stratified condominiums must provide buyers with a 2-5-10 New Warranty Insurance policy before they can occupy their newly built home. The builder will provide you with a copy of your warranty certificate which will include your warranty certificate number.
Q: How do I know if my new home has 2–5–10 New Home Warranty coverage?
A: You can use HPO’s online Registry Search tool to quickly verify if your new home has been registered with HPO’s Residential Construction Performance Guide (RCPG). Entering your property address into the RCPG search field will display any related documents such as your original warranty certificate.
Q: What happens if there are defects in materials and labour or violations of the Building Code in my new home?
A: If you find defects in materials and labour or violations of the Building Code that relate to items covered under your 2–5–10 Home Warranty policy then you should contact your builder immediately. Your builder must correct any building code violations or defective work within one year from date of first occupancy.
Q: Does this coverage replace my existing homeowners insurance policy?
A: No. Your homeowners insurance policies still apply; however, some policies may be affected by items covered under this warranty program. You should speak to your insurer about how these policies interact.
Q: Does normal wear and tear affect my coverage under this 2–5–10 New Warranty Insurance program?
A: No. Normal wear and tear is not covered under this program since it does not involve any defect. However, certain items supplied by the homeowner may be excluded from coverage.
Q: What other types of insurance coverage should I consider when purchasing a new homeowner?
A: In addition to obtaining a mandatory warranty , it is important for prospective homeowners to obtain other forms of insurance such as liability insurance , contents insurance , mortgage life insurance etc., depending on their individual circumstances and needs.
Conclusion
The 2-5-10 Warranty offered by BC Housing is a great asset for common property owners and strata homes. This warranty policy covers the home for non-residential purposes, supplied by the owner, and helps to prevent or minimize damage. It is important to ask the builder what the specific warranty terms are as they can vary based on date the home was built, legal title to first owner, frequently asked questions, first occupancy or date of transfer registry search through an agent, home insurance policies and more.
For those who have purchased a newly built home, it is highly recommended to get a policy of home warranty insurance in order to protect yourself financially just in case something unexpected happens.
Ready to turn your real estate dreams into reality? Contact Richard Morrison, Vancouver’s top realtor with 20+ years of experience. As a Medallion Club member and RE/MAX Hall of Fame award winning agent, he’s the expert you need on your side. Whether buying, selling, or investing, Richard’s personalized approach and deep market insights ensure a successful transaction. Reach out to Richard today at (778) 900-2235 and make your real estate journey seamless and rewarding.
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