Owner-builder regulations

If you are thinking of acting as your own General contractor (owner-builder) to build a single family home then please take notice.

As of November 19th, 2007 the Home Protection Agency (HPO) will implement the Homeowner Protection Amendment Act. This amendment will allow for easier access and information online but has created more stringent criteria and fees. The Act strengthens HPO’s ability to pursue and file legal action against persons abusing the owner-builder regulation.

The HPO was created in 1998 under the Homeowner Protection Act to enhance the standard of residential construction and to protect the homeowner. This was the result of the Leaky Condo Disaster of the mid 1990’s where hundreds of millions of dollars in repairs and law suits brought the construction industry to its knees. See www.hpo.bc.ca/Overview/index.htm for more historical information. By the way BC was not the only area to experience this level of construction failures. Many areas of the coastal US, Australia and New Zealand had faced similar issues and in the case of New Zealand they have totally changed their codes and enforcement regulations.

In short the original Act created mandatory new home warranty insurance and builder licensing for single and multi family projects. All homes are required to be built by a licensed builder or through an owner-builder exemption. No building permits can be released until proof of HPO certification has been provided. But unfortunately HPO agents found that it was very difficult to pursue and charge violators under the original wording of the Act. This led to non-registered builders and owners to violate the intent of the Act and as a result buyers of owner-built homes did not have the same level of protection as buyers of homes built by licensed builders.

The major changes for owner-builder authorization are:

• Applicants are required to go through a pre-screening process
• Owner builder Authorization fees are $425
• Owner builders are expected to occupy the new home themselves for at least 12 months after obtaining an occupancy permit and are not permitted to sell or rent the new home during that one-year period.
• Owner builders will be obligated to provide a disclosure notice if they sell the home within a 10-year period. The disclosure notice will state that the home was built by an owner builder and whether or not there is a policy of home warranty insurance in place for the home.
• Owner builders who sell their home within the first 10 years are obligated to subsequent purchasers for defects in the home during that 10-year period. Owner builder obligations are now similar to the obligations of a Licensed Residential Builder under a policy of home warranty insurance. That is 2 years for material and labour, 5 for defects in the building envelope and 10 years for structural defects.
• Homes built after November 19th will be identified on a registry will notify potential purchasers if the home is owner-built or built by a Licensed Residential Builder.

Note any individual who has obtained authorization prior to November 19th can use the old forms until February 19th, 2008.

For further information on the Home Protection Amendment Act contact HPO help desk or contact us at info@flywheelbuildingcoach.com