New home warranty – Rental use designation

Rental use designations are available for rental developers or property owners who meet the following criteria:

• There is an intent to build and retain a multi-family rental property for at least 10 years with no intention to sell, subdivide or include the land in a condominium plan.
• The multi-family property will be built on and remain under a single land title.
• The developer holds a valid Alberta residential builder licence.
  • Refer to the Residential builder licensing page to find out the required license class for your project.
• An approved development permit has been issued by the municipality or the authority having jurisdiction before applying for the rental use designation.

Purchasing new home warranty is optional for purpose-built multi-family rentals. However, purchasing warranty offers maximum flexibility and consumer protection for developers and owners.

The advantage of obtaining new home warranty is that rental properties can be sold, subdivided or converted into condominiums at any point within the 10-year protection period.

Note: Once a rental unit has been occupied, obtaining warranty coverage becomes more expensive and, in some cases, may not be possible. This could limit the developer's or owner's ability to deal the property during the protection period.

Once a rental use designation application has been approved, the Registrar will file a caveat against the certificate of title for the designated land.

This caveat restricts the sale, inclusion in a condominium plan or subdivision of the land during the 10-year protection period unless the Registrar provides written permission. If the 10-year period has expired, a discharge of caveat can be requested.

To request written permission from the Registrar, contact the Residential Protection Program at [email protected].

Developers or owners are required to inform the Residential Protection Program of the date when either:

• the first unit is occupied
• an occupancy permit or final inspection is issued by the municipality or the authority having jurisdiction

The earlier of the dates provided will be considered as the beginning of the 10-year protection period, during which the property cannot be sold without warranty coverage.

If the owner or developer changes during construction, the rental use designation can be cancelled. The project must then be re-registered as either a:

• new rental use designation by the new owner or developer
• property with new home warranty coverage

To subdivide or convert the rental units into a condominium plan within the 10-year protection period, the Registrar's permission is required. Additionally, all units will need to be covered by a new home warranty policy for the duration of the protection period.

To request written permission from the Registrar, contact the Residential Protection Program at [email protected].