It sounds hard to believe, but Hoyer thinks his home is the wave of the future in Canada. If anything, he says, Canada’s behind the curve. Hoyer’s home is based off the “passive house” standard developed in Germany. The standard puts emphasis on upgrading the building envelope, or exterior structure of the building, to make sure it’s well insulated and airtight. Buildings using this approach have seen a drastic reduction in the amount of energy they use for heating or cooling.

While there are few passive homes in Canada, there are more than 20,000 houses in Germany using this technology. And there will be many more soon. A European Union resolution passed in 2008 calls on each member state to adopt the passive house standard by 2016 for all new construction and major renovation projects.

“We’ve been building houses backwards our whole life,” says Hoyer. Normally, pipes and air ducts start to get added to a home once the framing is done; but in a passive house the mechanical and insulation is kept completely separate. And the only way to do that is to fully insulate the house first, right down to the floor and then fit the duct work and pipes into the house.

Of course, building an airtight home is only the beginning. Triple-paned windows, solar panels and an innovative heat recovery system keep Hoyer’s house comfortable year round. Hoyer has even cut his water bill by installing a rainwater cistern in his backyard to supply his toilets.

The cost to build a home like this isn’t as high as you might think. Hoyer estimates features like the ones in his home would add about 6% to 7% to construction costs. “It’s a no brainer,” he says. “Going forward this is the cheapest house to own.”

The payoff has been dramatic. Despite more than tripling the size of his home, Hoyer’s utility bills are about $1,200 for the year, a third of what he spent on his old bungalow, and less than half the national average.

See how it all comes together in this video.

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Do you want to cut your utility bill in half? In “The home energy makeover” we show you the projects you can do on your own and identify which projects give you the biggest bang for your buck.

Top-line grills can fetch $3,000 or more, but you don’t have to break the bank for good quality. Many manufacturers offer barbecues for $500 or less, and while they may not have all of the features you’ll find on more expensive models, they generally sport porcelain-coated grates (to withstand high temperatures for years) and electronic ignitions.

Barbecue aficionados know that a higher BTU count in the burners will net you higher temperatures in a shorter time, and of course, the larger the primary grilling surface the more burgers you’ll be able to cook at once. But those aren’t the only variables we consider with these five modestly priced models.

Broil Mate 165154 ($200)
With just two burners and a 400-sq-in. primary cooking surface, the Broil Mate is one of the smallest grills we looked at, but it punches above its weight in quality and performance. Users praise this product for top-notch construction, and for providing even heat across its “Dual H” 44,000-BTU burner system. No frills like side burners or stainless steel surfaces here, but the $200 price tag is hard to beat, and the limited five-year warranty bests some of the competitors.

Char-Broil Gourmet TRU-Infrared 3-Burner T-36D ($480)
By offering a lifetime warranty, Char-Broil is certainly confident that this grill will last. Infrared cooking results in juicier steaks, prevents flare-ups and uses less fuel than conventional grilling systems, the company says. Users say it heats up quickly and evenly, and it has a 13,000-BTU side burner to supplement the 500-sq-in. primary cooking area. A wood chip opening makes it easy to add extra flavouring to your masterpieces. But at $480, it’s no bargain in this comparison.

Coleman Even Heat 3-Burner ($500)
The 680-sq-in. grilling area gives this Coleman model an edge in the size department. The manufacturer claims the “Quick Clean” grease management system simplifies cleanup by channeling grease to a tray. It has a side burner, and it’s the only model in our survey with a fuel gauge. But reviews are mixed, with some people saying the 3-Burner heats up quickly and evenly, and others saying it’s relatively slow to reach cooking temperatures. Some complain about build quality as well.

Master Chef S482 ($250)
Big grill, small price—what could possibly go wrong? On paper the Master Chef is a champ, offering a 48,000-BTU, 480-sq-in. primary grilling surface and four burners for enhanced heat control, all for the second-lowest price in this barbecue tête-à-tête. Buyers love the price, but some say the construction isn’t up to snuff, the heat comes on unevenly, and it’s super slow to reach high temperatures. The limited one-year warranty—the shortest in the group—also doesn’t inspire confidence.

Weber Spirit E-210 ($500)
Weber calls this model “basic but far from boring.” It’s small (350-sq-in. primary cooking area, a 26,000-BTU burner system), but that also means that it’s compact, making it ideal for small decks and patios. Users say the Spirit E-210 can be counted on for even heat and excellent build quality—better than some other bigger, less-expensive products. Weber’s customer support comes in for praise as well. With a 25-year warranty on the hood and a 10-year warranty on the burner tubes, the company stands behind its products. But with a price tag of $500, it’s one of the two most expensive barbecues on our list.

Verdict

The lowest-priced Broil Mate is the best value on our list of bargain grills, indicating that sometimes you can get more than you paid for.

Would you buy a couple of defunct tractor-trailers, cut some windows and a door, insulate and live inside? People do it.  How about turning what most people would consider a walk in closet into an apartment? The New York Times published a piece called Think Small about a family of five living in 700 square feet. Yup, even here in the “Great White North.” BlueSkyMod bills itself as a low impact, high design living: Retreat without a footprint.

Okay, not everyone is prepared to go really, really small. In fact, some people don’t want to leave their big homes, eh-vah! The Ontario government thinks it’s a good idea to help people stay in their homes by offering money to retrofit. Hey, I figure if you don’t have the money to retrofit, you probably don’t have the wherewithal to maintain your home or pay someone to help you do so.

The upsides of a small home are obvious, aren’t they? Lower property taxes, cheaper to both heat and cool, less expensive to maintain. But there are some other benefits that fit with the simpler lifestyle you may want at retirement. Smaller homes mean less time cleaning! They’re cheaper to furnish and have less room for clutter, so you can’t be tempted to buy every tchotchke that pops up and catches your fancy.

Of course, you better be damn sure you really, really like your mate before you commit to moving into something so small you can never escape the sound of their voice. Having said that, if you’re on your own, what do you want with gobs and gobs of space?

The answer I most expect to hear when I ask this question is this (said in a whiney voice): But Ga-yal, where will I put all my stuff?

Which brings me to my main point. Imagine for a minute that you had to move into 800 square feet of living space. What would you take with you? What would you be willing to give up?

Now answer me this: of the stuff you’d be unwilling to give up, how often are you using that stuff now? So why are you keeping it? And why are you continuing to add more stuff?

People are always complaining that they just don’t have any “extra” money to save, as if saving is optional. If you lived in an 800-square-foot home, how much could you save?

To help ease the burden, his brother Derek, 21, agreed to go halfers (we’ve changed their names to protect their privacy). Derek would own half the house and pay half the mortgage, and Jonas would live in it and rent part of it out to friends. But even then, they didn’t have enough to make the down payment on the $420,000 wood-frame house they were eyeing. So they turned to mom and dad. The brothers made separate pleas to their parents, who are divorced. Their dad, Russell, said yes, agreeing to give them $15,000 each for the down payment. Their mom, Emma, said no.

Which parent did the right thing? It’s a question I just can’t get out of my head—perhaps because my husband and I recently purchased our second home and I’m eight months pregnant. I know how tough it is for young home buyers, and 20 or 30 years from now, when my son buys his first home, I could face the same request. To help me make up my mind, I decided to research the arguments for and against helping your kids buy their first home.

Your kids have it tougher

Quite quickly I came across the most compelling argument in favour of helping your kids: Houses are much less affordable now than they were when you bought your first home. Canadian households earn $35,000 more today than a generation ago. But that’s before you factor in the rising cost of living, known as inflation. Once you do, you find that the typical Canadian household makes about the same as in 1980.

But home prices sure aren’t the same as they were back then. Even after accounting for inflation, the average Canadian home now costs dramatically more than in 1980. If you were looking to buy an average-priced Canadian home back then and you earned an average income, you would have to save every penny you made for 1.9 years to completely pay it off. But if you earned an average income today and wanted to buy the same home, you’d have to save for 4.4 years.

Mixing family and money

At this point I was pretty convinced: only cold-hearted parents would refuse to help out their kids. But then I talked to Karin Mizgala, CEO of MoneyCoaches Canada, a national network of fee-only financial professionals.

She told me there are strong reasons not to help an adult child get into the property market. “If money weren’t an object and life were perfect, I’d say don’t do it,” says Mizgala. “Mixing family and money has the potential for disastrous family dynamics.” She warns that setting up a “parental bank” could create a sense of entitlement and expectation. “This can be very dangerous to a child’s financial and overall maturity.”

Still, she did suggest a compromise: Instead of giving your kids the money, you could loan it to them. “But you have to write a formal agreement and put everything in writing,” says Mizgala. “That way your expectations are clear, your child doesn’t feel beholden to you, and they continue to develop their own sense of independence.”

Tied to the home

There’s one more argument against giving your kids the money, and this one I learned from Emma. You’ll recall that she refused to give her two sons Jonas and Derek any money for their down payment. And she’s still not sure her ex-husband did the right thing by giving them the money. You see, since buying the house, her sons, who run their own construction business, have run into some hard times. To help them make their mortgage payments, Emma and her new husband have hired them on at their standard rate to do home renovations for them.

Emma sees her sons, both not yet 30, stressing out about making their payments and she can’t help wondering if they were too young to buy a home. “Their mortgage is like a ball and chain,” she says. They can’t travel, change professions, or even save for another big purchase.

Mizgala agrees this can be a problem. By jump-starting your kids into home ownership, you may not be doing them a favour. “Check your own motives for helping,” Mizgala says. “We live in a culture where not owning draws criticism and judgment. That kind of guilt can play on a parent.” Asking your kids to spend a few years saving up a bigger down payment before they buy helps to ensure they’ll be ready for the responsibility of home ownership when they do.

After considering both Mizgala’s arguments and the genuine struggle that young people have to go through to buy, my husband and I have decided that when the time comes, we will help our boy—but we’ll loan him the money at prime, not give it to him. We believe that by structuring our financial contribution as a low-interest family mortgage, and not as a gift, we’ll help him stay fiscally responsible. And that’s a lesson that will keep on giving, even after his starter home has come and gone.

The Noguchi coffee table consists of three pieces: A curved triangular ¾-inch glass top and two identical wooden legs that lock together to form a tripod base. Designed in 1947, it was produced a year later by American furniture manufacturer Herman Miller. An original Noguchi, which goes for $1,385 at online Canadian retailer Gabriel Ross, has the designer’s signature etched in the edge of the glass, along with a medallion on its solid wood base, which comes in cherry, white ash, walnut and black. The pieces are manufactured in Grand Rapids, Mich., and distributed worldwide.

You can find imitation Noguchis at Modern Furniture Knock Off in Toronto. They vary in size, and the material used to build them isn’t quite as high grade. However, the shape and design closely mirror the original. The largest model, which sells for $449, stands at 16 inches, slightly taller than a real Noguchi. The small version, which goes for $349, has a hard plastic base instead of wood. It’s the same height as the original, though slightly more compact in length and width. Both versions are made in China and come in black, walnut, natural and espresso.

So on Father’s Day that year, Maureen bought Peter a chainsaw. (We’ve changed their names to protect their privacy.) The following weekend, believing that one line of hedges was on his property, Peter cut them down.

The Fabinis’ neighbours, the Richardsons, were livid. They had planted the cedars 20 years ago for the privacy—which was now gone. The Fabinis then proceeded to put up a chain link fence on what they believed to be their side of the property line—right up against the remaining hedge. Fuming, the Richardsons filed a lawsuit. They wanted the unsightly fence to come down, and they wanted to be compensated for the destruction of their hedge.

What happened next? After a year of legal battles, the Fabinis were forced to take down the fence. Turns out that neither the hedge nor the fence were on their property: they were on the Richardsons’ side. Peter had made a huge mistake by neglecting to check where the boundary line was between the two properties. The total cost to the Fabinis for their hasty action? About $4,000 in damages to the Richardsons, plus a whopping $11,000 to cover the legal costs for both sides—a costly price for a Father’s Day gift.

The Fabinis’ story is as common as it is sad. Lawyers can tell you endless stories about the feuds they’ve seen between neighbours—most arising from a simple lack of communication. “For most people, their home is their castle,” says Lyon Gilbert, a dispute resolution expert and private judge in Ottawa. “Their first thought when a dispute arises is often, ‘Why should I put up with it?’” Neighbours rarely do enough research before acting. Like the Fabinis, they make false assumptions about property boundaries, often leading to years of bad blood.

Whatever the reason—noisy neighbours, parking issues from a mutual driveway, piles of unsightly junk propped against a shared fence—it’s short-sighted to endanger good neighbourly relations for the sake of being right. “We tend to take adversarial positions from the beginning,” says Colm Brannigan, a mediator in Brampton, Ont., who helps homeowners resolve disputes. “Most people talk to their neighbour, but they don’t really listen or communicate effectively and that escalates the dispute. That’s sad because chances are, unless you’re willing to move, you’ll have bad relations with your neighbour for years to come. Nobody wants that.”

If you’ve got a festering dispute with your neighbour, or if you’re a happy homeowner who wants to avoid one in the future, we can help. By following the tips below, you can ensure that you never become embroiled in a lengthy—and costly—court battle with the people nearest you.

Size up the situation

Before you approach a neighbour who’s upsetting you, identify the specific problem. Don’t just say, “My neighbour is an idiot because he insists on having trees near the property line.” Stick to the facts. In the Fabinis’ case, Peter might have put it this way: “The hedge between our properties is an obstacle to my using the driveway, and I have to constantly touch up the scratches on my car. It also interferes with my kids playing with their friends.”

Then consider what you’d like to happen: “I’d like for us both to trim the hedges in a way that maintains your privacy, but also limits the damage to my car and ensures my sons can use the driveway.”

Talk it through

Once you understand the issue clearly, approach your neighbour politely. “You don’t get people to give you something by calling them jerks,” says Fred Berenbaum, a Toronto-based mediator. State your concerns without blame, and make sure you really understand what he’s saying in response. Try to come to a mutual solution before you take any other action.

For instance, if you’d like to put up a fence and would like your neighbour to pay part of the cost, make sure he agrees to do so before you start building it, says Berenbaum. “If he agrees to pay only $1,000 and the fence ends up costing $3,000, he may decide not to split the difference. In that case, let it go. It’s a lesson learned. Next time, get an agreement that’s iron-clad before you do anything.”

The good news is that settling the dispute amongst yourselves often means there is no cost in time or money. Best of all, you maintain a good relationship with your neighbour. “Neighbours are all about enduring relationships,” says Gilbert, the dispute resolution expert. “Resolving your issue with your neighbour will have long-lasting benefits.”

Get a free community mediator

If you and your neighbour can’t solve the dispute on your own, you may want to try mediation. Mediators are neutral third parties who aim to have the parties reach a solution that’s beneficial for both sides. There’s no best-case or worst-case scenario: instead, the mediated settlement is usually “good enough” for both parties to feel they got something out of the proceedings.

The session usually takes less than a day, and the results are amazingly effective. “With mediation, it’s a win-win for both parties,” says Gilbert. “Both parties usually walk away feeling good about things.”

In fact, more than 80% of all disputes that go to mediation are settled before going to court, and another 5% resolve shortly afterwards, once the feuding neighbours have had time to think things over. If the parties come to terms, they sign a mediation agreement: it isn’t a legally binding contract, but both sides are highly likely to abide by it. If the parties can’t agree, the mediator summarizes the progress they’ve made, and they can agree to meet again. If the case ends up going to trial, these discussions won’t be used as evidence in court.

Some communities offer free mediation services that are handled by volunteers. “We hand-pick our volunteers, and they’re broadly representative of the neighbourhood,” says Peter Bruer, manager of conflict resolution training at St. Stephen’s Community House in Toronto. “We walk them through a structured approach to resolving issues. The aim is to mend relationships and help neighbours figure out how to accommodate each other.” The volunteers typically meet with each neighbour separately first, and then schedule a session where everyone sits down to work out an agreement.

Condo boards also provide free mediation services. “There’s a joke in the condo community that all disputes are about one of three things: people, pets or parking,” says Jennifer Bell, a mediator with Placet Dispute Resolution in Toronto, a firm experienced in mediating disputes between condo neighbours. In some provinces, condo disputes must be mediated before any party seeks legal action. The condo board’s lawyers pick a mediator through the ADR Institute of Canada, an industry group that promotes dispute resolution services. Such mediators charge between $200 and $800 an hour, and the cost is fully paid by the condo board. “The mediation session is usually attended by condo board directors, the property manager and the owners of the units,” says Bell. “We take the problem and try to make sense of it for everyone. It’s a team approach, and it works really well.”

One condo mediation case in Oakville, Ont., this year involved 55-year-old Marie Cross and her husband Max. The couple moved into their unit in July and brought along their golden retriever, Blackie, even though the building has a no-pet policy. After several complaints from the neighbours, the condo board asked the Crosses to either get rid of the dog or sell their unit and move.

Marie refused, claiming that her real estate agent had failed to disclose the building’s no-pet policy. More important, she said the dog was a therapeutic tool for a severe anxiety disorder she suffers from.

Marie’s claim that she is disabled made a cut-and-dried case much more complicated. According to the Ontario Human Rights Code, which prevents discrimination on any basis, if Marie is disabled and relies on the dog for therapy, then she would get to keep Blackie, regardless of condo policy.

A meeting between the Crosses, the condo board of directors and the property manager took place in early November. Five minutes before the meeting was to start, Marie sent notice that she couldn’t attend because she was having a panic attack. (Max attended on her behalf.) Now the case is being mediated, and medical experts are being consulted on two key issues: whether Marie has a genuine disability, and whether the dog is a necessary therapy. Both must be true for Marie to be able to keep the dog—if not, either she or Blackie will have to go.

Hire a mediator

If you live in a city or town that doesn’t offer free mediation services, you and your neighbour may decide to hire one to resolve your dispute. Check the ADR Institute of Canada website for mediators in your area. Figure on paying somewhere between $1,500 and $3,000 for a half-day to full-day session. Most disputes are resolved in that short amount of time. The cost is usually split equally between the two of you and paid to the mediator immediately after the meeting.

Even if you file a lawsuit against your neighbour, your lawyers may recommend that you mediate your dispute before going to court. In fact, this is mandatory in some jurisdictions. The lawyers will pick the mediator, and both you and your neighbour will show up for the session along with your counsel. Having the lawyers there is crucial, because by this point neighbours may no longer be talking to each other. The lawyers act as coaches, and the mediator keeps both sides negotiating until they reach an agreement that pleases both sides.

Take the case of Jim McNeil and Joseph Caragana, two neighbours in downtown Toronto who share a mutual driveway with access to garages at the back of their properties. The arrangement went smoothly until three years ago, when Caragana started a catering business from home. As the business grew, catering trucks would constantly block the driveway—to the point where McNeil’s access to his garage was often blocked.

One weekend, McNeil had enough. He put up a fence right down the driveway on the boundary line—which happened to leave nine feet of space on his side, and only two feet on his neighbour’s side. Caragana was completely cut off from his garage. A furious Caragana took the fence down. Police were called but they categorically told the two neighbours to settle it amongst themselves.

That’s when McNeil sued, seeking an injunction that would prevent Caragana from driving his vehicles on McNeil’s side of the driveway. For his part, Caragana claimed “adverse possession,” meaning that under the law he had acquired the right to use the full driveway because he’d been using it continuously and with no objection from his neighbour for more than 10 years.

The lawyers for McNeil and Caragana scheduled a mediation session. By this time, the two men were barely speaking to each other and both wanted to win at any cost. So the two lawyers consulted with each other and specifically chose a direct, take-control mediator they knew could settle the case. He was tough on both parties, telling them outright, “This is stupid. You’re going to burn through more money than the two feet of property is worth.”

With a lot of convincing from the two lawyers, McNeil and Caragana came up with an agreement. “It was really pretty simple,” says Edwin Upenieks, a lawyer and mediator with Lawrence, Lawrence, Stevenson in Brampton, Ont. “No fences. The two agreed to get along. Neither side would park on the driveway, and both parties will give each other unrestricted access to their garages at all times. Pretty basic stuff really, but enough to get them to agree.”

While such mediations are hugely successful, they are costly. You will be responsible for your lawyer’s fee (about $5,000 to $8,000), the mediator’s fee (split with your neighbour), and any damages you agree to in the mediation session.

Take it to court

If after talking to your neighbour and going through mediation you still can’t come to a mutual agreement, then you have only two choices left. One is to agree to disagree, and simply not talk to each other anymore. The other is to take your neighbour to court.

Court battles can be nasty—make no mistake. “You’ll get cases where a neighbour may be fighting on principle, where someone just won’t settle—no matter what,” says Berenbaum. “They may even prefer to give their money to the lawyer rather than to the other party. Realize that if you go to court, there will be one winner and one loser—no compromises allowed. The judge simply makes a ruling based on the law. It’s black and white.”

Taking your case to court will also cost you thousands of dollars. The size of your claim will dictate which court you end up in. If it’s under a specified limit—$5,000 to $25,000, depending on your province—it will be heard in small claims court, where you plead your own case without a lawyer. If the judge makes an order in your favour, the onus is on you to collect. “You can take the judgment and try to collect, or register a lien against your neighbour’s house or car if they refuse to pay,” says Berenbaum. The main cost will be a small fee for filing the claim, plus the cost of any experts you bring to court to support your case. And while you may get a ruling in your favour and technically “win,” the truth is that you and your neighbour will likely never speak to each other again.

If your claim is more than your province’s limit for small claims, then your case goes to Superior Court where a lawyer will likely represent you. “By the time you get to Superior Court, there is some pretty serious money involved,” says Berenbaum. You may have to spend $10,000 to $15,000 in legal fees, and if you lose, you may even have to pay part or all of your neighbour’s legal fees in addition to any damages. “I know of a lot of fences that cost people $60,000 in litigation fees because of a couple of inches along the property line,” says Berenbaum.

The lesson? Make every effort to settle a dispute sooner rather than later. Your neighbour—and your wallet—will thank you.

When Karen Somerville and her husband Alan Greenberg showed up for the pre-delivery inspection of their brand new luxury home in Ottawa they were horrified. Electricians, drywallers, plumbers and a variety of other tradespeople were still busy constructing their home and, despite assurances from the builder, the couple seriously doubted their $443,000 new build would be ready for possession in 14 days. Electrical wires hung from ceilings and stuck out from unfinished walls, appliances and cabinets were stacked in the kitchen, and only a portion of the hardwood floors had been installed. They immediately hired an independent contractor to examine the home. The result was a deficiency report citing 130 problems, including an undersized furnace and ductwork, poor ventilation and improper roof installation.

At first, Karen, then a university professor, and her husband Alan, an account manager with Sun Microsystems, tried to negotiate with the builder to resolve the problems. When this proved futile, the couple turned to Tarion—the private corporation that regulates Ontario builders and provides warranties on new houses and condos. Tarion sent its own inspector who confirmed that there were 85 defects in the home—but only 39 were considered to be under warranty.

Karen and Alan would be on the hook to fix the other defects themselves, which would cost the 40-something couple $4,000 or more. “This is the largest purchase we, as consumers, make,” says Karen, “and Tarion is supposed to be there to help.” Instead, she found herself having to document and defend an appeal against the provincial warranty program’s decision—despite paying a $650 fee for her new home warranty.

Buying a new home directly from the builder, whether a condo, townhouse or detached, is a popular choice. Almost one third of all homes sold in Canada each year are brand new. In Ontario alone, more than 52,500 buyers opted for a new build last year, and a forecast by the Canada Mortgage and Housing Corporation (CMHC) predicts that number will only climb. Despite the problems Karen and Alan encountered, it’s easy to see the appeal: Buying direct from the builder means you can customize your dream home to your exact tastes. It means higher energy efficiency ratings than older homes, and often higher quality building materials. New homes also have lower maintenance costs and are less likely to surprise you with a serious issues such as a cracking or tilting foundation, severe plumbing problems, asbestos or knob-and-tube wiring that needs replacing.

But as Karen and Alan discovered, there are some pitfalls specific to a new home purchase too—pitfalls that we don’t want you to run into. To help out, we’ve compiled the top 10 mistakes that new home buyers make, so you can be sure to avoid them. Read on to find out why you should be wary of the show home, what to do if your new place isn’t ready on time, how to save big money on upgrades, and most importantly, how to make sure that the dream home you’re expecting is the one you actually end up getting.

Mistake #1: They fall in love with the show home

When Jason Saxon and his wife Emily set out to find a builder in the quaint Edmonton suburb of Spruce Grove, they were surprised to find only two builders operating in the area. “Only one of them offered the separate dining room that we wanted,” says Jason, which made their choice easy. The deal was clinched when they toured the builder’s magnificent show home. “It had everything we needed,” gushed the systems analyst. The couple (whose names have been changed to protect their privacy) was so impressed by the show home they booked an appointment with a salesperson on the spot. Within days they had a signed purchase agreement and were busily designing their dream home.

That, of course, is the result every builder is aiming for, explains Stan Garrison, an industry insider with more than 20 years experience (we’ve changed his name to protect his privacy). “Most people fall in love with the show home, but you have to realize that everything you see in that model home is an upgrade,” he says. “And upgrades are a major portion of a builder’s 10% to 20% profit margin.”

Upgrades are so profitable for the builder because the industry standard is to charge double the sub-trade’s fee—a cost that is passed directly to the buyer, Garrison says. “That means the $8,000 granite countertops you ordered really cost your builder $4,000. Now multiply that by 25 buyers and you can see how builders make a profit.”

That doesn’t mean you should never order an upgrade, but you do need to be clear on what is an upgrade and what isn’t—and do a little bargaining so you don’t get taken for a ride. “With new builds there is no room for negotiation on the base sale price,” explains Max Wynter, a realtor with Re/Max Realtron Brokerage in Markham, Ont. “But there is room to negotiate the price of your upgrades.”

The rule of thumb is the more upgrades you spring for, the bigger the discount you should angle for. “If you purchase $5,000 in upgrades the builder may only give you a 10% discount,” says Garrison. “But purchase $50,000 in upgrades and you can start asking for $10,000 to $15,000 off the final price.”

Mistake #2: They trust the floor plan

Ken Grunber, who works at a video production house in Toronto, found out too late that the new condo unit he bought in 2007 wasn’t nearly as large as advertised. When he and his partner moved in and measured the area, they discovered it wasn’t 700 square feet after all. The condo was actually 560 square feet—if you don’t count the balcony and bathroom.

“That’s not unusual,” says Martin Rumack, a real estate lawyer with over three decades experience in new build construction. “Condo sales staff will often include balcony or terrace measurements as part of the total square footage. New home sales staff will provide square footage based on measurements of external walls. You can’t rely on their verbal assurances, on the floor models, or on the sale pitch or brochure.”

Unfortunately, many new home decisions are based solely on brochures or artist renditions. For instance, a sales brochure sold the Saxons on upgrading to French doors for the entrance to their walkout patio. “We’d originally seen the sliding doors in the show home, but a brochure highlighted the double French doors and we loved the look,” says Jason. They quickly paid the upgrade fee, but when they moved in they were surprised to find the doors didn’t have the little window panes with wooden slats between them that they had seen in the photo. Instead there was just one huge pane of glass in each door. “The price quoted by the builder’s sales rep didn’t include window slats, just clear glass. It would cost us more to get slats,” Jason says. “Now I know: get every detail in writing.”

In fact, the builder has the discretion to change an image, or floor plan, or layout and “you have no say,” says Rumack. He suggests asking for a breakdown of room sizes and plan details, and to “get it in writing.” Then, if there’s a substantial difference between what you’re sold and what you get you can either negotiate a price reduction or try and get out of the deal.

Mistake #3: They don’t get their contract lawyered

Whether you’re buying a new detached home or a condo, the purchase agreement is the legally binding document that spells out what you’re getting and the conditions of the sale. It’s full of fine print and legal-speak, and if you sign without legal representation, you risk being bound to terms you don’t understand or don’t want. More importantly, says Rumack, it destroys any chance of re-negotiating the terms of the sale.

“Skip legal advice and you could end up with an electrical utility box on your front lawn that you can’t do anything about, or no side door on your garage, regardless of what the plans looked like,” he says. “You could find yourself stuck with any manner of substitutions, exclusions or inclusions that could detract from your home’s future value.”

When you’re buying a condo, depending on the province you live in, you may have a cooling off period of up to 10 days. This gives you a chance to pay $800 to $1,600 and hire a lawyer to go through your contract after it’s signed. If you don’t like what they find, you can back out of the deal.

Unfortunately, there’s no such period for freehold homes, and many home builders demand that you sign a contract on the spot to secure your sale price or lot selection. Try to avoid this situation if possible, but if you must, at the very least insist on adding a clause that makes the deal conditional upon approval by your solicitor. “These days more and more builders are offering buyers a two-day period where they can seek legal advice before the contract becomes binding,” explains real estate lawyer Sheldon Silverman.

Mistake #4: They don’t bother with an inspection

During the home buying process there are two specific times when it’s important to have your house inspected. The first is the pre-delivery inspection, a mandatory walk-through for all new homes under warranty. This inspection takes place with your builder shortly before you officially take possession of your home. The second inspection should be scheduled for about one month before your home warranty expires. In Ontario the first and broadest portion of your warranty expires 12 months after your possession date, in B.C. it’s 24 months after possession.

During the pre-delivery inspection, you probably don’t need to pay for a professional inspector, but you might want to “take along a friend who’s wise about construction,” says Silverman, “because if you don’t write down the deficiency then the builder isn’t obligated to fix the problem.”

However, hiring a professional home inspector to do a second walkthrough before your warranty expires is a must. This will allow your home to go through all four seasons, which is enough time for major defects to start showing up, and you’ll still be able to get them fixed under the first stage of the standard provincial warranty, which covers against material and labour defects.

Mistake #5: They accept delays without a fight

Believe it or not, until quite recently, if your new house wasn’t ready on time, it was your problem. “Builders were not required to provide reasons or to limit their delays,” says Rumack. But that all changed when Toronto condo buyer Keith Markey challenged a Tarion decision five years ago.

In 2001, Markey bought a unit in a soon-to-be constructed condominium tower in downtown Toronto. His initial possession date was Nov. 30, 2002. But as the date approached, the builders kept sending letters announcing delays. Markey’s possession date was moved back six different times—he wasn’t able to move in until eight full months after the initial possession date.

He requested $5,000 from the builder to compensate him for the delays. The builder refused, the case went before a tribunal, and Markey won. Tarion appealed the case, but in 2006, Markey was vindicated: Not only did he receive almost $5,000 in compensation but close to $9,000 in damages. The case changed how Tarion and other provincial warranty programs handle builder delays.

“The law is now clear and critical dates are now included as part of the purchase agreement and contract,” says Silverman. “If a builder misses these critical dates and requires an extension, a buyer can either agree, and seek compensation, or simply get out of the deal.” Either way, Silverman suggests seeking legal advice whenever you’re presented with a request to delay a critical date.

Mistake #6: They forget they are moving into a construction zone

Anyone considering a new condo or home purchase should take into consideration the impact of ongoing developments. As one reader, who bought into the first phase of a three-phase condo development, recalls: “It’s noisy, everything is dusty and the air quality is just plain horrible—not even the best furnace filter could catch this dust. Combine that with the fact that the whole area is ugly for quite a long time and that access points can open and close, depending on the phase, and you have a recipe for long-term aggravation.”

Still, others, such as Jason Saxon, were mentally prepared for living in a construction site, and actually found it kind of fun—at times anyway. “You take the dust and dirt and noise with a grain of salt,” he says. “And it’s actually nice watching the homes go up.” In fact, there were only two days out of that first construction year when the Saxons and their neighbours felt truly inconvenienced. “When the builders put the final grading on our road no one could drive or park on our street,” Jason recalls. “For many of our neighbours that meant a hike through muddy and overgrown fields just to get home.”

Mistake #7: They think they have a warranty—but they don’t

Most buyers assume that all new-build lofts, condos and homes are covered by a provincial warranty, but this isn’t the case. Only three provinces—B.C., Quebec and Ontario—make warranty coverage mandatory. In fact, those are the only provinces that require new home builders to register with their respective provincial regulator at all.

“In Ontario, it’s illegal to build without being registered,” says Janice Mandel, vice president of corporate affairs at Tarion. But in other provinces, where the warranty program isn’t mandatory, builders can simply opt-out of coverage. Often they’ll try to convince home owners that they’re saving them the registration costs.

Buyers should be proactive and get their new home warranty in writing, says Mandel. They should also go online to determine if their builder is registered with a provincial regulator as a new home builder. This is particularly important for loft or condo conversions—residential units constructed inside an existing building shell. In such situations, new-build warranties often don’t apply.

Mistake #8: They’re not speedy with their warranty claims

When the Saxons first moved into their dream home near Edmonton, they were delighted. But they soon found themselves caught in a bureaucratic nightmare. During that first winter in their new home, they noticed a large crack in the cement-block floor of their garage. So they called the builder, who told them that when the ground thawed in the spring the problem would be fixed. A few months later, when the ground started to thaw, they noticed even more cracks stretching from their garage down their driveway. “We phoned, spoke to the site super, and even flagged down a builder’s representative, who promised us a new driveway.”

But weeks went by and nothing happened. “What was frustrating was coming home to see that our neighbour had a newly poured driveway and ours was still pock-marked and cracked.” That’s when Jason started sending emails. “You have to hound the builder, who seems willing to fix anything, but just needs a lot of motivation.” After weeks of sending emails and making calls the Saxons finally got a new driveway and garage floor.

The Saxons were able to get the problem fixed because they were proactive and understood that there are strict time limits on making claims. To ensure you understand how long you have, carefully read the package you get during the pre-inspection, as there are different deadlines for different types of warranty claims. “My advice: get a calendar and mark down those deadlines, and then make sure you get the claim in at least five days before the deadline,” says Peter Balasubramanian, vice president of claims for Tarion.

While you’re reading your new home package, you should also familiarize yourself with the maintenance you have to do to ensure your warranty remains valid. For instance, if you forget to change your furnace filters or fail to clean out your gutters you could find a claim regarding deficient heating or water penetration into your basement is deemed to be invalid.

Mistake #9: They’re ambushed by hidden closing costs

When you sign the purchase agreement for your new place, many of the closing costs are estimates. These costs often escalate as you approach your possession date, and both Rumack and Silverman have seen their fair share of “absurd” adjustments tacked on to a buyer’s purchase contract. For instance, you may find large charges that suddenly materialize for hooking up gas and electricity meters, plus mortgage discharge fees, development fees, deposit verification fees—Rumack has even seen a fee for “public art contributions” to cover the cost of a sculpture by a building’s entrance. “That’s why I pay close attention to the adjustments and try and get a cap on certain items and remove others,” Silverman says.

Mistake #10: They buy at the wrong time

If you’re buying a new condo or townhouse as an investment, the key is to get in as early as possible. In order to get the financing to start a new project, builders will often raise initial funding through pre-sales. These pre-sales often kick off with invitation-only VIP events, says Wynter. Usually, only high-volume realtors who specialize in the type of building on offer are invited. “If you see a line-up at a sales office, it’s often because a VIP event has been scheduled.” Once the VIP event is over, the builder will open sales up to all interested realtors, then finally they’ll open the project up to the public. “By the time a builder throws a grand opening for the general public, often 50% of the units have already been sold and the price has gone up three or four times,” explains Wynter.

It’s easy to get in on these VIP pre-sales, but you’ll need to work with a realtor who specializes in new developments and be ready to move quickly. For instance, the Paintbox development—the second phase of condos in the newly revitalized Regent Park area of Toronto—gave VIP realtors a week to register their clients for the pre-sale. Four days after registration closed clients were required to sign the paperwork.

Despite the potential savings on purchase price, this can be a risky way of buying real estate. When the Vancouver condo market turned in 2008 many pre-sale buyers found themselves with a contract price that was much higher than the current value of the unit. The builders refused to renegotiate the purchase contracts, and their banks refused to grant pre-arranged mortgages for the original purchase price. Many buyers were forced to either default—and lose their money—or find additional funding elsewhere, at significantly higher interest rates.

If you’re purchasing a freehold home, keep in mind that purchasing at the right time of year can also save you tens of thousands. For instance, in the Greater Toronto Area, the summer is the best time to shop for a new development, says Garrison. “People are on vacation in July and August and don’t have time to look for houses. When things slow down for a builder you have more bargaining power as a buyer.” Another good time to look is in December and January, but by mid-February activity starts to pick-up, says Garrison, and deals are taken off the table.

In Vancouver’s Lower Mainland the opposite is true: real estate and new home purchases are typically hot in the summer and slow down significantly over the rainy months of November and December. Each local market has its own cycle, so it’s best to talk to an experienced realtor.