Ask homeowners what worries them most about a major renovation and very few say design. They say some version of: how do I know I can trust these people with my house and my money?
It is a reasonable fear. Renovation is one of the largest purchases most households ever make, and unlike a car or a mortgage it is bought largely on promises. The good news is that a great deal about a contractor is genuinely verifiable before you sign anything — if you know what to check and what to ask. Here is how to do that properly in Ontario.
Start with the paperwork you can actually verify
Anyone can describe themselves as licensed and insured on a website. These are the three things you can independently confirm.
1. Licensing, and the nuance most homeowners miss
In Ontario, anyone who builds or sells new homes — including custom homes built on your own land — must be licensed by the Home Construction Regulatory Authority (HCRA). Licensed builders must also enrol each new home with Tarion, which provides the statutory new home warranty. Most new homes in Ontario carry seven years of warranty protection beginning at first occupancy.
You can look a builder up yourself in the HCRA’s public Ontario Builder Directory, which shows licence status and any charges or convictions on record. If you are commissioning a custom home, do this before you sign. It takes two minutes.
The nuance: renovation-only contractors are not required to hold an HCRA licence. A company doing kitchens, bathrooms and basements is not breaking any rule by not having one, so its absence is not a red flag on a renovation. It is only a red flag if someone is building or selling you a new home without it. Firms that hold the licence anyway are signalling they are equipped for new builds and additions as well as renovations.
2. A current WSIB clearance certificate
Ask for a WSIB clearance certificate and check that it is current. This matters more than most homeowners realise: if an uninsured worker is injured on your property, you can find yourself exposed to liability you never contemplated. A legitimate contractor will produce this without hesitation, and you can validate a clearance directly through WSIB.
3. Liability insurance — verified with the insurer
Request a certificate of commercial general liability insurance and confirm the coverage amount and that the policy is active. The step most people skip is calling the broker or insurer named on the certificate to confirm it is real and in force. Two million dollars in coverage is a common benchmark for residential renovation work.
What a real renovation contract contains
A one-page quote with a lump sum and a start date is not a contract; it is an invitation to a dispute. A proper agreement covers the following.
Scope, exclusions and allowances
The scope should describe what is being done in enough detail that a stranger could read it and know whether it was delivered. Just as important is what is excluded. And watch the allowances: if the contract carries a $4,000 allowance for tile and you have chosen tile costing $9,000, your price is going to move. Allowances set deliberately low are the most common way a quote is made to look competitive.
A payment schedule tied to milestones
Payments should be tied to completed stages of work, not to dates on a calendar. A deposit followed by progress payments at defined milestones — rough-in complete, drywall complete, substantial completion — keeps the money roughly aligned with the work. Be cautious about large deposits. A deposit funds mobilisation and materials; it should not fund most of the project before anyone has lifted a tool.
A written change order process
Changes happen on nearly every renovation, either because you change your mind or because something unexpected appears behind a wall. What separates a well-run project from a miserable one is that each change is priced and approved in writing before the work is done. Verbal changes settled at the end are the single most common source of renovation disputes.
Warranty terms in writing
Ask what is covered, for how long, and how to make a claim. Distinguish between the contractor’s workmanship warranty and manufacturers’ warranties on products. A company that intends to be around in three years will happily put its warranty in writing.
Two Ontario protections worth knowing
The 10-day cooling-off period
Under Ontario’s Consumer Protection Act, a contract negotiated and signed somewhere other than the supplier’s place of business — typically, in your own home — is a direct agreement. Consumers can generally cancel a direct agreement for any reason within 10 days of receiving a written copy of the signed contract.
This exists precisely because kitchen-table sales pressure is a known problem. If a contractor is pushing you to commit tonight for a discount that disappears tomorrow, you have a legal cooling-off window — and you have also learned something about how they sell.
The 10% holdback
Ontario’s Construction Act requires the party paying for work to hold back 10 percent of its value as it is completed. The purpose is to protect you if a subcontractor or supplier is not paid and registers a lien against your property. In broad terms, a lien must be preserved within 60 days and enforced within a further 90.
Holdback is often overlooked on residential renovations, and homeowners who release every dollar immediately can end up paying twice if a sub goes unpaid. Ask how your contractor handles holdback. This is general information rather than legal advice, and for a substantial project it is worth a short conversation with a lawyer.
Ten questions that reveal how a contractor actually works
- Who is on site every day, and who is my single point of contact? You want one accountable name, not a rotating cast.
- Are the trades employees or subcontractors, and are they the same crews each time? Neither answer is wrong; consistency is what matters.
- Who pulls the permits? The contractor should. If they ask you to pull a permit for their work, treat that as a serious warning — it shifts responsibility onto you.
- What is the payment schedule, and what triggers each payment? Milestones, not dates.
- How are change orders priced and approved? Look for “in writing, before we proceed.”
- What happens if you find something unexpected behind the walls? Good answers involve stopping, documenting, pricing and getting approval.
- How do you protect the rest of my home during construction? Dust barriers, floor protection, daily cleanup and a defined site tidiness standard.
- What is your realistic timeline, and what typically delays a project like mine? Anyone who says nothing ever delays their projects is either inexperienced or not being straight with you.
- Can I see a project of similar scope, ideally in progress? Finished photos are marketing; an active site shows you how they work.
- Can I speak to two clients from the last year, and one from three years ago? The older reference is the valuable one, because it tells you how warranty issues were handled.
How to check references properly
Most people ask for references and then ask the wrong questions. “Were you happy?” produces a polite yes almost every time. Ask instead:
- Did anything go wrong, and how did they handle it? Something always goes wrong. You are assessing the response, not the absence of problems.
- Did the final price match the contract? If not, why? This surfaces allowance and change-order behaviour.
- Did they finish on the timeline they gave you?
- Did you have to chase them at the end? The last five percent of a renovation is where weak contractors disappear.
- Would you use them again for something bigger? A more revealing question than whether they were happy.
Online reviews are useful in aggregate rather than individually. Look for volume, recency and consistency over time, and read how the company responds to criticism. A handful of five-star reviews all posted in the same week says less than dozens accumulated steadily over years.
Red flags worth walking away from
- A cash discount for avoiding HST. This removes your paper trail, your warranty position and any recourse if things go wrong. It is not a saving; it is a transfer of risk to you.
- A large deposit demanded up front. Particularly when paired with urgency.
- No written contract, or a refusal to itemise.
- Pressure to sign immediately. Legitimate contractors have backlogs; they do not need you to decide tonight.
- Reluctance to provide insurance or WSIB documentation. This is routine paperwork for a real company.
- Asking you to pull the permit. Occasionally a sign of someone who cannot.
- A quote dramatically below everyone else. Sometimes it is efficiency. More often it is a different scope, thinner allowances, or work that will be re-priced later.
What the cheapest quote usually costs
Low quotes are rarely low because a company found a way to do identical work for less. They are low because something is different: less demolition, a cheaper waterproofing approach, thinner allowances, no permit, no project management, or a plan to recover margin through change orders once the walls are open and you have nowhere else to go.
The way to protect yourself is not to ignore the cheapest quote — it is to make every quote itemised and directly comparable. When you can see the line items side by side, a genuinely efficient contractor still looks good, and a quote that was engineered to look cheap stops being able to hide.
If you would like to see how we work, take a look at our completed projects, read our client testimonials, or book a free consultation for an itemized estimate you can actually compare.
This article is general information, not legal advice. For a substantial project, consider having a lawyer review your contract.
Vetting a renovation contractor: FAQs
Do renovation contractors need a licence in Ontario?
Not for renovation work itself. HCRA licensing is required for anyone who builds or sells new homes, including custom homes. A renovation-only contractor is not required to hold one, so its absence is not a red flag on a kitchen or basement project — but it is essential if someone is building you a new home.
How do I check whether a builder is licensed?
Search the HCRA’s public Ontario Builder Directory. It shows licence status and any charges or convictions on record. For a new home build, also confirm the home is enrolled with Tarion before you sign.
How much deposit is reasonable for a renovation?
A deposit should cover mobilisation and initial materials, not most of the project. Be cautious about large up-front payments, especially combined with pressure to sign quickly. Progress payments should be tied to completed milestones rather than calendar dates.
Can I cancel a renovation contract after signing?
Often, yes. Under Ontario’s Consumer Protection Act, a contract signed somewhere other than the supplier’s place of business — such as your own home — is a direct agreement, and consumers can generally cancel within 10 days of receiving a written copy of the signed contract.
What is a construction holdback and does it apply to me?
Ontario’s Construction Act requires the payer to hold back 10 percent of the value of work as it is completed, protecting you if a subcontractor or supplier goes unpaid and registers a lien. It applies to residential renovation work and is frequently overlooked. Ask your contractor how they handle it.
Should the contractor or the homeowner pull the permit?
The contractor. If a contractor asks you to pull a permit for their work, treat it as a warning sign — it moves responsibility for code compliance onto you and can indicate they are unable to pull it themselves.
Are online reviews reliable when choosing a contractor?
In aggregate, yes. Look for volume, recency and consistency over several years rather than a small cluster of perfect reviews posted close together, and pay attention to how the company responds to criticism.
What is the most useful reference question to ask?
“Did anything go wrong, and how did they handle it?” Something goes wrong on nearly every renovation, so the response tells you far more than whether the client was happy. Asking for a reference from three years ago is also valuable, because it reveals how warranty issues were handled.