Ontario Adding New Protections for Home Buyers
Province expanding deposit insurance while consulting on potential cooling-off period for new home purchase agreements
March 31, 2023
Public and Business Service Delivery
Municipal Affairs and Housing
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TORONTO — The Ontario government is doing more to protect first-time home buyers and their savings by expanding deposit insurance for First Home Savings Accounts at Ontario credit unions.
The province is also consulting on a ‘cooling-off period’ for buyers of new freehold homes and seeking input on whether it should be mandatory to receive legal advice before signing a purchase agreement for a new home. These measures are part of the government’s plan to provide people with the very best in consumer protection to ensure they have the necessary tools when they buy a new home.
“Hard-working Ontarians can rest assured this government has their backs and is doing everything to protect them when making one of the biggest purchases of their lives – a new home,” said Kaleed Rasheed, Minister of Public and Business Service Delivery. “These new measures that we are consulting on will help us protect and inform home buyers and consumers alike, empowering Ontarians to keep making smarter, safer decisions when choosing this province as their forever-home.”
The government will consult with consumer groups, the public and the home building sector through the Ontario Regulatory Registry in the near future on a cooling-off period for new freehold homes. If approved, a purchaser could rescind their purchase agreement within a specific timeframe and builders would be required to disclose the cooling-off period to purchasers. As part of the consultation, the government will also seek input on whether there should be a requirement that purchasers of all new homes receive legal advice on their purchase agreements.
At the same time, Ontario credit union members who are saving for a first home would be protected. First Home Saving Accounts were introduced by the federal government and credit union members can use them to save for the purchase of their first home. As part of their introduction to the marketplace, the Ontario government is looking to expand coverage under the Deposit Insurance Reserve Fund for First Home Savings Accounts at Ontario credit unions.
“Our government is helping first-time home buyers who use credit unions to save as they look to enter the marketplace,” said Peter Bethlenfalvy, Minister of Finance. “By expanding coverage under the Deposit Insurance Fund Reserve Fund for First Home Savings Accounts of Ontario’s credit union members, we are providing more ways for people to save for their first home, while providing institutional safeguards for credit unions and caisses populaires.”
“We continue to put policies in place that will ensure Ontario is ready to build more homes and build them fast as market conditions improve,” said Steve Clark, Minister of Municipal Affairs and Housing. “As we do, we will continue standing up for home buyers and ensure their interests are protected as we work to build the homes Ontarians need.”
“Our government wants to ensure owning a home is in reach for everyone across the province,” said Nina Tangri, Associate Minister of Housing. “We continue to work with all levels of government and the private sector as we introduce measures that will form a solid foundation to building new homes in both rural and urban communities in Ontario.”
- The Condominium Act, 1998 provides a 10-day cancellation period for purchasers of new condominiums from a builder.
- The Home Construction Regulatory Authority can impose administrative penalties on unethical practices of builders and vendors who unfairly cancel pre-construction projects or terminate a purchase agreement.
- More than 1.7 million Ontarians are members of a credit union or caisse populaire.
- Credit unions and caisses populaires are regulated by the Financial Services Regulatory Authority of Ontario.
- The Credit Unions and Caisses Populaires Act, 2020, requires a review of the legislation and regulations every five years and that the recommendations be made public.
- Ontario’s housing starts continue to trend in the right direction. Last year, starts surpassed 96,000 – the second-highest number since 1988. These trends have continued into 2023.
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