New homes in BC: licensed builders, the 2-5-10 warranty and owner builder rules

Buying a new house or building one on your own lot in BC involves a licensing and warranty system run through BC Housing. Many problems come from not knowing which path a home was built under, especially when buying a home built by an owner builder.

The 2-5-10 warranty

Home warranty insurance on new homes provides 2 years on labour and materials (with some limits), 5 years on the building envelope including water penetration, and 10 years on the structure. Coverage limits depend on the type of home; for detached homes, BC Housing describes the cap as the lesser of the first owner's purchase price or $200,000. Insurers must be approved by the BC Financial Services Authority.

Licensed residential builders

New homes are generally built by licensed residential builders who arrange the warranty insurance. Before signing with a builder, check the builder's licence status and ask for the warranty provider.

Owner builders

An owner builder does not need a residential builder's licence or third-party warranty, but must obtain an Owner Builder Authorization from BC Housing before construction starts, which involves a fee and an exam. The owner builder must personally build or directly manage the home. Hiring someone else to do that is an offence for both, with monetary penalties.

Buying an owner-built home

An owner builder who sells within 10 years remains liable to later buyers for defects, in periods that mirror the warranty: 2 years for labour and materials, 5 years for the building envelope and 10 years for structural defects. That is a legal duty, not insurance; check BC Housing records and get advice before buying.

Renovations are different

This system covers new homes. Renovations to an existing home are not covered by 2-5-10 home warranty insurance; your protection there is your contract and the contractor.

Prevention Checklist

• Check the builder's licence with BC Housing before signing.
• Ask for the home warranty insurance provider and policy.
• Owner builders: get the Owner Builder Authorization before starting.
• Buyers of an owner-built home: confirm its status and understand there is no insurance.
• For renovations, put warranty terms in the contract.

References

1. BC Housing. Home Warranty Insurance: What Homeowners Need to Know, Web page, 2-5-10 coverage and limits. Accessed 2026-11-01.
2. BC Housing. Regulatory Bulletin 3: 2-5-10 Home Warranty Insurance, Web page, Coverage periods. Accessed 2026-11-01.
3. BC Housing. Information for Owner Builders, Web page, Owner builder authorization and duties. Accessed 2026-11-01.

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