The British Columbia government is attempting to once again cool the province’s red hot real estate market.
The province is set to introduce legislation in 2022 requiring cooling-off periods for resale properties and newly built homes.
This change will be similar to the cooling-off periods already in place for pre-construction sales. Cooling off periods are limited periods of time where a buyer can change their mind and cancel the purchase with no, or diminished, legal consequences.
One of the practices under the microscope with the change is looking at alternatives to the blind bidding system, as well as waiving conditions in order to put in a more competitive offer.
“People looking to buy a home need to know they are protected as they make one of the biggest financial decisions of their lives,” Finance Minister Selina Robinson said on Thursday. .
“Especially in periods of heightened activity in the housing market, it’s crucial that we have effective measures in place so that people have the peace of mind that they’ve made the right choices.”
Housing prices in Metro Vancouver continue to be sky-high, with the benchmark price for all home types in the region sitting at $1,199,400.
The Real Estate Board of Greater Vancouver found the largest value increases in the last month have been in Maple Ridge, Whistler and Pitt Meadows.
The board reported 3,494 home sales in October, about 22 per cent higher than the historical average.
The province is responding not just to the climbing prices but to the practice of potential homeowners giving up basic tools like a home inspection in order to make things easier for the seller.
The BC Financial Services Authority (BCFSA) is also being asked to consult with stakeholders and review other potential consumer protection measures as part of the changes.
“With this step, we’re moving ahead to protect people and their interests in the real estate market by bringing in a cooling-off period for homebuyers and looking at additional measures to ensure effective safeguards are in place,” Robinson said.
The consultation will take place to determine the parameters of a cooling-off period for resale properties and newly built homes.
The advice will be provided to the government in early 2022 and the legislation is expected in spring 2022.
“Ensuring fair markets and promoting public confidence in B.C.’s real estate market is a key priority of BCFSA, and we welcome the direction from the Minister to lead this valuable consultation work,” BCFSA CEO Blair Morrison said.
“BCFSA’s goal is to ensure that British Columbians are protected when buying and selling homes – one of the most important financial transactions of their lives. Both buyers and sellers need to be supported and have time to make good financial decisions.”