The Ontario
government is bringing forward new regulations, set to take effect next year,
that would allow home buyers to see all competing offer prices — but only if
the seller agrees.
The new open
bidding option would begin next April, the province confirmed. Under current
regulations, real estate agents are required to share the number of bids, but
are prohibited from sharing details of those competing offers. But starting
next spring, with the seller’s permission, agents can offer specifics on
whichever parts of the bid the seller so chooses, meaning they can elect to
share just the price, the closing date, or the financing conditions, or any
preferred combination of the particulars.
“Sellers
will no longer be limited to selling their property through a closed or
traditional offer system,” Minister of Government and Consumer Services Ross
Romano said in a statement. “With these changes, hard-working Ontarians can
rest assured knowing that our government has their backs as they embark on
their journey of home ownership.”
The
provincial announcement comes less than two weeks after the federal government
included a plan to ban blind bidding nation-wide in its 2022 federal budget.
Government at all levels have been pushing for increased transparency in real
estate transactions amid rapidly rising home prices and fierce bidding wars.
Both the federal plan and the Ontario one have received mixed reviews.
It’s not yet
clear how many sellers would opt to share this information, but Tim Hudak, CEO
of the Ontario Real Estate Association, expressed his support of the province’s
decision, saying that it will bring more transparency to the home buying and
selling process.
“The changes
will make real estate transactions more open by allowing home buyers to see
information about other offers being made on a home, provided the seller and
other parties consent,” Hudak said. “These changes were part of a package of
reforms the Ontario Real Estate Association worked closely with the Province to
bring forward, which strike the right balance between adding more transparency
to the offer process and protecting a homeowner’s right to sell their home how
they want, instead of blanket bans on the traditional offer process.”
The package
of reforms also includes measures that would give regulators at the Real Estate
Council of Ontario (RECO) new powers to go after “bad actors” by widening their
jurisdiction to encompass the entirety of the provincial government’s Trust in
Real Estate Services Act.
“By giving
RECO these powers, we’re streamlining and speeding up the process needed to
resolve issues and ensuring real consequences for those acting in bad faith,”
Romano said.
There would
also be a new Code of Ethics for real estate agents, as well as standardized
real estate forms and stricter requirements for agents to disclose when a buyer
and seller are using the same brokerage.
“Ontario
realtors want to see North American-leading professionalism in the industry,”
Hudak said. “It’s too easy to get into the business and too hard to get kicked
out. These changes will give RECO extra powers to throw the book at agents who
are violating consumer trust. Tougher disciplinary measures will go a long way
in ensuring that the realtors by your side during one of the most critical
decisions of your life has the highest professional standards.”
But not
everyone is pleased with the proposed changes. In response, leader of the Green
Party of Ontario Mike Schreiner said that simply offering the option of open
bidding is not enough, as sellers will likely continue to withhold that
information when given the choice.
“Home-sellers
shouldn’t be able to pick and choose when the bidding process is transparent
and when it is blind,” Schreiner said. “That defeats the purpose of ending blind
bidding, since it’s in sellers’ best interest to keep buyers in the dark.”
Written By: Laura
Hanrahan
Source:
STOREYS