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Home regulator sounds alarm over illegal building in Ottawa

The province's real estate regulator is raising the alarm over unregistered builders who it says may be putting Ottawa homebuyers at risk.

Following an investigation into illegal building in Ottawa, Tarion, a non-profit organization that administers warranty coverage on new homes, announced Monday it's joining the City of Ottawa and the Ontario Home Builders' Association to clamp down on the problem.

The regulator said since 2013, its compliance and investigations department has opened 72 investigations into 136 homes in the Ottawa area. In that same period it has laid 66 charges and secured 47 convictions in provincial offences court relating to illegal building.

"We only know what is reported to us, and we want to make sure homeowners understand that they can come to us," said Siloni Waraich, Tarion's vice-president of stakeholder engagement, in an interview with CBC News at a model home in Findlay Creek.

Builder pleaded guilty

In February, local builder Livingstone Developments pleaded guilty to three counts of submitting false information and two counts illegal vending under the Ontario New Home Warranties Plan Act, according to Tarion.

The company was also under under investigation by Tarion in 2012 after a couple complained work on their home had come to a grinding halt.

Waraich said all builders in Ontario must be registered with Tarion if they sell a new home or new condo, and pay an enrolment fee of up to $1,800. Those who do not register aren't eligible for the regulator's seven-year warranty.

Unregistered builders can put homebuyers at risk often by building homes with defects, or vanishing before the home is completed, Waraich said.

She said realtors can also be on the hook by selling illegally built homes.

Expanding pilot project

The Ontario Building Partnership, a consumer protection group, started a pilot project in 2015 in 15 municipalities in Ontario to have municipal building departments refer permits from prospective homebuyers to Tarion to educate them on warranty requirements.

Tarion hopes to push the provincial government to expand the program Ontario-wide.

"We're disappointed that we're still waiting for that legislative change," said Joe Vaccaro, CEO of the Ontario Home Builders' Association.

"The reality is that when a consumer looks to build their own home and bring in a contractor they generally don't realize the kind of obligations they're taking on. Things like health and safety, work compensation issues, and just general building issues."

Tarion urges all homebuyers to consult their website for more information and to search a directory of registered home builders.