Would-be homebuyers in the Lower Mainland will soon have a little more transparency around sales with multiple offers.
Starting later this month, the three real estate boards in the region will formally require listing realtors to disclose the number of offers on a sale.
Currently, that disclosure is done on good faith.
Under the new requirements, the selling realtor will be required to provide a form to all parties who summited offers within 24 hours of the seller accepting a bid.
“Over the course of the pandemic when there was a lot of multiple offer situations emotions run high, and we heard those anecdotal stories about people not having great experiences about it,” said Craig Munn, vice-president of communications for the Real Estate Board of Greater Vancouver.
“We want to make it a better experience for homebuyers in this market.”
Munn said the new rules will ensure homebuyers get consistent communication, and will create evidence on paper of what transpired in the offer stage.
The form will list all brokerages that made an offer and the date it was made, though it won’t list details such as bid prices.
Munn said that’s important because just because an offer has been accepted doesn’t mean it will necessarily close.
“We want to respect the negotiating rights and positions of both the home seller and the homebuyer,” he said.
“It wouldn’t make sense that buyers have to disclose how high they were willing to go, nor should sellers have to disclose how low they would be willing to go to sell their home.”
Vancouver realtor Steve Sartestsky said the new regulations were needed, and that more transparency in the market is always welcome.
“Essentially it’s an honour system we’ve been relying on, and I think we’ve seen over the years that there are unfortunately a few bad apples so to speak that kind of ruin it for everyone else,” he said.
But Saretsky said he’d have preferred to see the regulations go further, and require a real-time disclosure of the number of bids, rather than after the fact.
“In Toronto they have a process where when you submit the offer you have to register … so everyone can kind of see that hey, seven bids have been registered on this property and it creates a bit more clarity up front. I think that’s something that’s unfortunately missing from this,” he said.
“Obviously you’re going to make a different offer most likely whether there’s two offers on the table and 10 offers, your price is probably going to be different.”
Metro Vancouver planner and developer Michael Geller agreed that learning about how many bids there were after the fact is less helpful than being aware beforehand.
But he said the regulations could provide a different advantage to the buyers who made the successful offer, thanks to new “cooling-off period” legislation that took effect in B.C. in January.
Under that legislation, successful bidders have a three-day “rescission period” to decide whether they want to withdraw their offer, though if they do they must pay a 0.25-per cent fee on the offer price.
Geller said the offer disclosure rules could help those buyers decide if they’ve overpaid for the home.
“Someone may make an offer thinking, ‘Oh there’s going to be so many offers, I hope I am high enough,’ and then when they find out they were the only one … they then have that rescission period to decide whether or not they want to proceed or not,” he said.
The new regulations will take effect July 17, and will cover the areas regulated by the Greater Vancouver, Fraser Valley and Chilliwack real estate boards.
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