New home warranty – Rental use designation

Overview

Under the New Home Buyer Protection Act, multi-family rental properties are eligible for a rental-use designation for their property.

This designation allows a rental developer to build a new multi-family rental property without needing to purchase a home warranty policy, if there is no intention to sell the property within 10 years.

The builder of the project must have a residential builder licence. The rental-use designation allows exemption from new home warranty, but it does not exempt the builder from licence requirements.

Should a rental property owner choose to sell units to home buyers within the 10-year period after construction, or if the rental property is converted to condominiums, those units will be required to have home warranty protection for the duration of the remaining 10-year protection period.

Single-family rental properties are not eligible for an exemption.

How to apply

Follow the steps below to apply for a rental-use designation when building a multi-family rental property.

Step 1. Log in to the builder’s portal

To apply for a rental-use designation, you need access to the New Home Buyer Protection System (NHBPS) builder's portal. Log in to MA Connect if you already have an account.

If you do not have an account, go to the New Home Buyer Protection System (NHBPS) website and complete the Account Request Form. If the landowner is not the builder for the project, the licensed builder can apply for the rental-use designation.

Step 2. Apply for a builder licence

If you do not have a builder licence, you will need to first apply for and be issued a builder licence before applying for a rental use designation. See Builder licensing for information on how to apply.

Step 3. Apply for a rental-use designation

Once you have been issued a builder licence, log into the New Home Buyer Protection Program and click on the Create Rental Exemption button to apply for a rental use designation.

You will need to provide information about the project, including property ownership, the type of building being constructed, location and builder information.

Pay the $95 application fee online or by cheque payable to the Government of Alberta.

Please be sure to submit your application online, then print out a paper copy and mail to the Residential Protection Program.

Step 4. Application review

Applications are not complete until both the signed form and the fee are received.

Complete applications are reviewed within 14 business days. During peak construction times, it may take longer.

Caveat

When a rental-use designation application is approved, the Registrar will file a caveat against the certificate of title for the land identified in the rental-use designation.

This caveat will prevent the land from being sold, included in a condominium plan, or subdivided during the 10-year protection period without the written permission of the Registrar.

The caveat will be filed within 10 days of the approval of the rental-use designation.

Change of use or ownership model

If the ownership of a building originally constructed under a rental-use designation changes during construction so that the individual units will be owned by their residents, the rental-use designation must be cancelled and the project must be re-registered, with warranty, under a new registration. If the ownership model changes after the building is completed, the individual residential units must be registered before they can be converted to condominiums.

Contact

Connect with the Residential Protection Program:

Hours: 8:15 am to 4:30 pm (open Monday to Friday, closed statutory holidays)
Phone: 780-644-1010 (within Canada and United States)
Toll free: 1-866-421-6929 (within Canada)
Email: [email protected]