Delayed Occupancy by builders
There is not a single homebuilder in the Province of Ontario that likes to delay a closing, regardless of the circumstances. According to the J.D. Power & Associates 2006 New Home Builder Customer Satisfaction Survey, delayed closings are quite prevalent in Mississauga, Downtown Toronto and Greater Toronto Area. Some reasons for occupancy delays can be attributed to record pre-construction condominium sales, lack of work crew and equpiment, unpredictable road blocks at development stage and sometimes public intervention. The customer satisfaction level of buyers who are kept well informed regarding status of construction process are found much higher than those who are kept in the dark.
The builder is permitted to extend the occupancy date of a purchaser’s condominium unit if the purchaser receives proper written notice of the extension. However, if the purchaser is not properly notified of a delay to the confirmed occupancy date, they are entitled to seek compensation under the terms of the Ontario New Home Warranties Plan Act.
Maximum no. of days for occupancy delay for condo
Agreement signed on or before June 30, 08
The builder can delay occupancy of a new condominium unit for up to 5 days without giving notice or compensation. Also, compensation will not be paid for delays caused by events beyond the builder’s control, such as strikes or floods, or for delays which the purchaser causes. Every purchase agreement for a condominium unit will include either a confirmed “occupancy date” or a “tentative occupancy date”. For the latter, the builder is required to inform the purchaser in writing of the confirmed occupancy date no later than 30 days after the roof assembly is completed (or another specific stage of construction as specified in the purchase agreement). If the purchaser is not given notice of the confirmed occupancy date 90 days before the tentative occupancy date, then the tentative date automatically becomes the confirmed date for the purpose of calculating compensation for the delay.
Once the confirmed occupancy date is established, the builder is allowed to extend it once by up to 120 days. In this situation, the builder must give the purchaser at least 65 days written notice. The builder can also extend the date by up to 15 days if they give the purchaser at least 35 days written notice. The builder is permitted to use both of these extensions as long as they give required notices and the total of the two extensions does not exceed 135 days.
Agreement signed on or after July 1, 08
Compensation arising out of delayed occupancy for condos
Once the purchaser gets occupancy of the unit (prior to the closing of the transaction) they may be able to claim compensation for delayed occupancy. It is prudent for buyers to speak with the builder and / their own real estate lawyer handling the closing. Once buyer submits a Delayed Occupancy Form ( can be obtained by calling TARION), they may be able to claim up to $100 per day in living expenses (such as temporary accommodation costs), plus other direct costs caused by the delay (such as extra moving and storage costs – receipts are required for these costs), up to a maximum of $5,000. If the purchaser submits a Delayed Occupancy Form without supporting receipts or other proof of expenses, the amount they may be able to claim up to $100 per day for living expenses. In all cases, the maximum amount that can be claimed for living expenses and other direct costs caused by the delay (such as extra moving and storage costs – and receipts are required for these costs) remains at $5,000. Homeowners must submit the delayed occupancy claim according to the service rules that are described in the Delayed Closing / Occupancy of the Homeowner Information Package.
Early occupancy date:
The builder may offer the buyer occupancy of the unit earlier than the confirmed occupancy date, but the builder cannot require that the purchaser accept it. The builder must obtain the purchaser’s consent in writing to an earlier date.