Tarion Delayed Closing & Occupancy Compensation: What a Builder Owes You When the Date Slips

Step 1: Know which warranty applies — delayed closing vs. delayed occupancy

Many of my pre-construction clients panic the moment a builder’s delay letter arrives. The first thing to do isn’t to argue — it’s to identify which warranty applies to your home. Tarion splits delays into two parallel sets of rules:

• Delayed Closing — for freehold homes (detached, townhomes, semis — anything with its own title) and contract homes. The key milestone is the Closing Date.
• Delayed Occupancy — for condominium units. With a condo you usually take “occupancy” first and register title later, so the key milestone is the Occupancy Date.

The dollar figures are identical for both ($150/day, capped at $7,500), but the date definitions and notice rules differ. Get this straight first, and you’ll read the right clauses in your contract.

Step 2: Read the Tarion Addendum and the Statement of Critical Dates

Your right to compensation isn’t buried in the body of the sales contract — it lives in the Tarion Addendum attached to it, and specifically in the Statement of Critical Dates inside it. This is the single most important page in the whole deal, and you should review every line before signing.

• Dates must be real calendar dates. According to Tarion, the closing/occupancy date must be a specific calendar date — not a “floating” date tied to some future event — or you may be entitled to terminate the agreement.
• Firm vs. Tentative dates is the core distinction. The builder picks one: a Firm Date signals confidence, and missing it (absent mutual agreement or an Unavoidable Delay) triggers compensation; a Tentative Date lets the builder extend under set rules.
• The outside date. Tentative dates can’t slip forever — the Addendum sets a final firm date, after which compensation and termination rights kick in.

Step 3: Understand the builder's notice rules — this is where claims are won or lost

A builder can’t simply delay and walk away free of liability. The core protection is advance written notice. According to Tarion (2026):

• To move a tentative date later without paying compensation, the builder must give you written notice of the new date at least 90 days before the applicable tentative date, following the Addendum’s extension rules.
• If the builder fails to give compliant 90-day notice, the tentative date generally becomes firm automatically — meaning any delay past it is compensable.
• A point many buyers miss: according to Tarion, if the builder fails to give you at least 10 days’ notice of a delay, you’re owed an additional $1,500 ($150 × 10 days).

So save every delay letter with its date. Whether notice came early or late directly decides whether — and how much — you can collect.

Step 4: How compensation is calculated — $150/day, capped at $7,500

This is what clients care about most. The figures below are from Tarion (2026); confirm the current amounts on Tarion’s site when you claim:

• $150 per day in living expenses. From the original (firm) closing/occupancy date until actual closing or termination, you’re owed $150 per day for meals and accommodation. This portion is a fixed amount — no receipts required.
• Other documented costs. Direct costs caused by the delay — moving, storage — are also claimable, but these require receipts.
• $7,500 overall cap. Living expenses plus other costs are capped at a total of $7,500.
• Or terminate. If the delay is severe enough that you walk away, you can — where eligible — recover your full deposit plus interest.

Example: a 60-day delay is $9,000 on the $150/day line alone, but the $7,500 cap limits the total payable (how living expenses and other costs stack toward the cap follows Tarion’s current rules).

Not every delay is compensable. According to Tarion, the following situations reduce or eliminate your right to compensation:

• Unavoidable Delay. Events outside the builder’s control — strike, fire, explosion, an “act of God,” civil insurrection, act of war or terrorism, or a pandemic. When the builder properly declares one and meets the conditions, it can extend the date without paying.
• Buyer-caused delay. If you didn’t pay on time, didn’t pick your finishes when required, or couldn’t close because your financing wasn’t ready, the delay is on you — and the builder doesn’t owe compensation.
• Signing an amendment. If you and the builder change the date by “mutual agreement,” you may be waiving compensation you’d otherwise be owed. Builders often present an amendment to sign in exchange for a new date — before you sign, be clear about whether you’re giving up your right to claim, and check with a lawyer if needed.

Compensation doesn’t arrive automatically — you have to claim it, and there are strict deadlines. According to Tarion (2026):

• Claim against the builder first. Make a written delayed-compensation claim to your builder within 180 days of your closing/occupancy date (or the date you terminate the agreement).
• If the builder won’t pay, go to Tarion. You can submit a claim to Tarion — generally during the first year of possession (or within 365 days of terminating the agreement).
• Keep all your proof. Save every notice letter, the original and actual dates, and receipts for moving and storage. The $150/day living-expense amount needs no receipts, but other costs are not payable without them.

My practical advice to pre-construction buyers: start a folder the day you sign. File the Addendum, the Statement of Critical Dates, and every delay notice by date — don’t go digging for paperwork after a problem hits.

How much does a builder owe per day for a delay, and what's the maximum?

According to Tarion (2026), delayed closing/occupancy compensation is $150 per day in living expenses — from the original date until actual closing or termination — plus other documented costs such as moving and storage (receipts required), up to a total maximum of $7,500. The $150/day living-expense amount needs no receipts. Confirm current figures on Tarion's site when you claim.

The builder says it's an 'Unavoidable Delay' so they won't pay — is that valid?

It depends. According to Tarion, events outside the builder's control — strike, fire, explosion, an 'act of God,' war or terrorism, a pandemic — qualify as Unavoidable Delay, and the builder can extend without paying if it properly declares one and meets the conditions. But the builder must genuinely fit the definition and meet its notice obligations; it can't apply the label loosely. When in doubt, confirm with Tarion.

If the builder keeps pushing a tentative date, do they avoid paying forever?

No. According to Tarion, to move a tentative date later without compensation the builder must give written notice of the new date at least 90 days beforehand and follow the extension rules. Without compliant 90-day notice, the tentative date generally becomes firm automatically and any delay past it is compensable. The Addendum also sets an outside date, so it can't slip indefinitely.

The builder wants me to sign an amendment to extend — should I?

Think carefully before signing. If you and the builder change the date by 'mutual agreement,' you may be waiving the delay compensation you'd otherwise be owed. Builders often offer an amendment in exchange for a new date. It isn't always against your interest, but you should know exactly what you're giving up — and consider asking a lawyer before signing.

How and when do I actually file a claim?

Claim against the builder first: submit a written claim within 180 days of your closing/occupancy date (or the date you terminate). If the builder won't pay, submit a claim to Tarion — generally within the first year of possession (or within 365 days of terminating). Throughout, keep the builder's notice letters, your date records, and cost receipts. Miss the deadline and you may lose the claim.