TORONTO – The Ontario government is giving property sellers the option of disclosing the details of competing offers, but not going as far as to ban blind bidding.
Minister of government and consumer services Ross Romano said in a statement that sellers will get to choose if they want to “opt for an open offer process” and share bids.
“Sellers will no longer be limited to selling their property through a closed or traditional offer system,” he said.
Blind bidding, a practice where buyers bid for a home without knowing the size of competing offers, is pointed to by some as one of the drivers behind inflated home price gains.
The move by the provincial government is part of a bigger reform to the Trust in Real Estate Services Act.
The changes, which also includes a new code of ethics for real estate agents, more clarity for buyers during the home buying process and greater powers for the Real Estate Council of Ontario to go after bad actors, are set to take effect on April 1, 2023
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The Ontario Real Estate Association (OREA) said in a statement that it welcomed the changes and worked closely with the province to bring them forward.
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“(It strikes) 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,” said association chief executive Tim Hudak.
Some experts see more transparency as a step in the right direction, but do not believe the provincial government’s latest move does enough to make the home buying bidding process fair.
“Making (bid disclosure) optional for sellers does not make sense,” said Sung Lee, mortgage expert with Ratesdotca. Blind bidding benefits sellers, not buyers. If the goal is to create transparency, this should be mandatory. ”
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The changes come a week after Ontario premier Doug Ford said he was “not in favor of adding new regulations” in a video posted on OREA’s Twitter feed.
The move also comes just a couple of weeks after the federal government announced in its latest budget that the Minister of Housing, Ahmed Hussen, would work with provinces and territories to develop a plan to end blind bidding and implement a Home Buyers’ Bill of Rights .
Somem realtors and housing experts have been pushing back against a full ban of blind bidding, arguing that it will do little to cool the country’s hot housing market and that sellers should decide on how they want to sell their homes.
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