The ABC’s of the New Home Business
Every industry has its lingo – acronyms and phrases exclusive to those ‘in the know’. The new home industry is certainly no exception. There are plenty of acronyms associated with new homes that you’ll likely never hear but may very well affect your home. These acronyms might be used to simplify community land details and stages of the planning and development process. Some examples include ZBA (zoning by-law amendment), C of A (Committee of Adjustment), NOAC (Notice of Approval Conditions), EP (Environmentally Protected Lands) SPA (Site Plan Agreement/Applicattion), SOG (Slab on Grade) HVAC (Heating, Ventilation and Air Condition) – and the list goes on and on.
On the other hand, there are acronyms and terms that every new homeowner should know and understand, as they’ll come up throughout the buying process. For instance, in the case of a condominium, you need to be familiar with interim occupancy, which splits your closing into a 2-step process. During occupancy, you move-in or ‘occupy’ the suite and the purchaser must pay the developer a monthly amount equivalent to the maintenance fee, interest on the deferred purchase price and the estimated property taxes. This is then followed by the final closing, when you actually own the suite.Conversely, the closing on a lowrise home conveys immediate ownership.
The first walk-through of your new home is during your PDI (Pre-Delivery Inspection). While this acronym isn’t exclusive to us – the car industry also uses the term – it’s important to understand what to look for during this inspection. While you want to use your PDI to ensure the installation of all selected finishes and any upgrades, you also want to ensure that the little details have been looked at.
Your PDI is governed by TARION – a private corporation that was established in 1976 to protect the rights of new homeowners and regulate new home builders. Interestingly enough, TARION isn’t an acronym as one might assume at first glance. It’s actually an anagram of the word Ontario (how clever is that!). The laws that protect consumers and regulate builders are outlined in ONHWP (Ontario’s New Home Warranties Plan Act). TARION and its associated laws under ONHWP make it one of the most comprehensive new home warranty programs in North America.
As a new homeowner in Canada, you might also find yourself dealing with CMHC (Canada Mortgage and Housing Corporation). CMHC is Canada’s national housing agency. Established in 1946, it addressed Canada’s post-war housing shortage and has since grown nationally. It’s the premier provider of mortgage loan insurance, mortgage-backed securities, housing policy and programs and housing research. While established almost 70 years ago, CMHC is constantly evolving to address the housing needs of Canadians and contributes to the overall stability of the market.
If you encounter any terms throughout the home buying process that are foreign to you, be sure to ask for clarification. Buying a home will be one of the biggest purchases you make in your life – likely THE biggest. It always pays to be an educated purchaser.