The Ontario Real Estate Association says the Liberal Party of Canada’s housing plan “would criminalize the ability for hardworking Canadians to choose how to sell their homes, by regulating real estate practices through the Criminal Code.” OREA’s statement, posted on its website with a photo of a jail cell, takes aim at the Liberal election promise to ban blind bidding during a real estate transaction.
“You cannot fix Canada’s housing crisis by denying millions of hardworking families the choice of how to sell their home and by pitting homeowners against buyers. In fact, this plan would have the opposite effect – negatively impacting Canada’s housing market and making home ownership even more unaffordable,” says David Oikle, president of OREA, in a statement.
“Open auctions are the norm in Australia and New Zealand, where sellers overwhelmingly choose to use an open process. Auction fever creates a three-ring circus on front lawns, as hopeful buyers crowd in front of a home with a live auctioneer, or online, and the bidding begins. Far from making homes more affordable, auctions can drive prices higher, and dangerously push buyers to make rushed decisions involving tens of thousands of dollars in just minutes,” says OREA.
The Liberal Housing Plan includes creating a “Home Buyers Bill of Rights” that would ensure “the process of buying a home is fair, open and transparent. It would include banning blind bidding, which prevents bidders from knowing the bids of other prospective buyers; establishing a legal right to a home inspection; “ensuring total transparency on the history of recent house sale prices on title searches;” and “requiring real estate agents to disclose to all participants in a transaction when they are involved in both sides of a potential sale.”
Kevin Crigger, president of the Toronto Regional Real Estate Board, says in a statement that “consumer choice and consumer privacy should be paramount in shaping government policy. Federal public policy should recognize the right that consumers have to privacy and should allow them to consent to the disclosure of personal information, instead of penalizing home buyers and sellers. Punishing home buyers and sellers for wanting to keep their financial decisions private for the largest transaction of their lives is a substantial overreach of the government.”
But Toronto real estate broker Philip Kocev of iPro Realty says, “In my view, OREA and TRREB’s approach has been an irresponsible and narrow-minded response to a very real consumer concern….Offer transparency can be simple. In Ontario, we can utilize our current regulated offer process – with tweaks to allow Realtors to be able to communicate what the top offer is to the seller – which may include price or other terms (price is not always the leading factor for a seller). All participants would know what the leading offer is (versus the current system where they need to guess) and be given an opportunity to improve their offer or walk away.
“OREA and TRREB keep saying that with transparency buyers lose confidentiality. That is simply not true. The identity of the buyer or any of their personal information would never be disclosed. Only the terms of the leading offer would be,” he says.
“At the end of the day, transparency alone won’t solve Canada’s housing affordability crisis or stop price growth. There will still be disappointed buyers and there will still only be one successful buyer, but buyers won’t feel like it was a rigged game, were not given an opportunity to bid again or weren’t even in the running and their offer was just being used to scare other bidders into paying more,” says Kocev.
The complete Liberal Housing Plan is here.
CREA’s election page with the association’s policy recommendations and links to all the party’s platforms is here.