Today’s modular homes are not the kit homes of the past

In 1908, Sears and Roebuck started selling homes in mail-order kits. You could choose from over 400 different designs – everything from a cottage-style bungalow to a colonial mansion – and Sears would package and ship the pre-cut and fitted components for you to put it together.

When you hear the term ‘pre-fabricated’ or ‘modular’ home, you might think it’s the kind of house that comes in a do-it-yourself kit. In fact, these terms actually refer to the way the home is built.

Most new homes are built from the ground up on the construction site. Modular homes, on the other hand, are produced in factories in sections or modules that are then transported to the job site and installed on a foundation.

Modular homes can look like, and be of equivalent quality, to homes built in the traditional way. The main advantages are that they can be cheaper and may come together faster because various stages of the build can be happening simultaneously off site.

When it comes to warranty coverage, as a general rule, modular homes do qualify – but they have to meet certain criteria.

As a general proposition, Ontario’s statutory warranty coverage applies to homes where the vendor or builder supplies the work and materials for the dwelling. This means either the home is built and sold by a person who owns both the land and the home, or the home is built by someone who contracted with the owner of the land to supply and build the home. If you as owner are purchasing and supplying all the materials or all the modules to build the dwelling, then statutory warranty coverage will not apply. Instead you will need to rely upon the builder’s contractual warranties, if any, and manufacturers’ warranties for the materials.

Other key requirements for coverage are that the home is not for seasonal or temporary use, the dwelling has not been previously occupied, and that the same person who builds and sells the home must also have supplied the permanent foundation.

Housing where the components are constructed off-site and assembled on-site is popular in other parts of the world and is gaining ground in Canada. Whether you decide this type of modular home is for you or you want to invest in a more traditionally built new home, it’s important to understand warranty coverage and to work with a registered builder. Before signing a contract with a builder, be sure to look them up in the Ontario Builder Directory on tarion.com. And if you are looking to invest in a modular home and have questions about warranty coverage, contact Tarion at 1.877.9TARION or email customerservice@tarion.com

Related reading

What you need to know about your home warranty

Your new home warranty is comprehensive and affordable