Home Buyers Need a Bill of Rights

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Ontario real estate law update with open bidding option enters into force

Option allows sellers to disclose submitted bid prices to buyers

The Canadian Press · Posted: Dec 01, 2023 8:58 AM AST | Last Updated: December 1, 2023
New rules for Ontario real estate are coming into force that are meant to provide more clarity and choice for buyers and sellers, though they don't go as far as some had hoped. The rules, which took effect Friday, include the option for sellers to use an open bidding process, improvements to broker and brokerage disclosures, and ways to avoid conflicts on multiple representation.
The open bidding option gives the seller the choice to disclose submitted bid prices to potential buyers, something they were previously banned from doing.
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Canada to Ban Blind Bidding As Part of Home Buyers' Bill of Rights

Real Estate article published in Storeys.com : 4:44 PM APR 7, 2022
New protections for Canadian home buyers and a ban on blind bidding are in the works as the federal government announced the development of a Home Buyers' Bill of Rights. Included as part of the 2022 Federal Budget put forward on Thursday, the government confirmed that over the next year, Minister of Housing and Diversity and Inclusion Ahmed Hussen will engage with provinces and territories "to develop and implement a Home Buyers' Bill of Rights and bring forward a national plan to end blind bidding."
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Federal Budget 2022- Housing supply gets $10 billion boost; Feds add measures to curb speculation

Article by Ian Bickis The Canadian Press Published, April 7, 2022 4:27PM EDT Last Updated Thursday, April 7, 2022 6:24PM EDT
Homebuyers in general will gain more protections through a bill of rights that is proposed to include a right to a home inspection, an end to blind bidding - a widely-used practice where sellers don't disclose competing bids - as well as potential mortgage deferrals and increased disclosures from real estate agents. Tim Hudak, chief executive of the Ontario Real Estate Association, welcomed the spending commitments, but said proposals to change how homes are sold, which include the end to blind bidding, would undermine consumer choice. "The commitment to ban the traditional offer process is a massive step back. It would unfairly target the financial nest egg of hundreds of thousands of families," he said in a release.
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Want to buy a house? Don't bother checking the foundations.

MacLean's Real Estate article by By Aaron Hutchins March 21, 2022
The pressure to waive inspections is a great enough concern that the federal Liberals promised during last summer's election campaign to introduce a legal right to them, a pledge that has made little impression on property-hungry Canadians. If they wait for Parliament to flesh out the details, prices will only soar further. Meanwhile, prospective buyers who insist on inspection clauses are having their bids rebuffed time and again. To streamline the process, some selling agents had pre-listing inspections done that they could share with prospective buyers, a practice that remains common. These buildings might then be sold without the home inspection clause, but at least someone has assessed them. The practice has downsides, though-most obviously that the inspectors are accountable not to the people who might live in the house but to sellers looking for the highest possible price. If the inspector missed something, the new homeowners have little legal recourse.
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Home inspections getting left out in the cold of a hot housing market

Article by Barbara Geernaert Feb 13, 2022 9:00 AM Guelphtoday.com
As a realtor, Val Brooks (president of the Cambridge Association of Realtors) said reluctantly, " the advice for potential new homeowners is not to have a home inspection." "I want to advise them to have a home inspection but I'm also going to tell them that if they put in an offer with a home inspection, they will not get the house," Brooks said." Bruce Jacobs (a registered home inspector who operates Jacobs Property Inspections in Waterloo Region) said if more homes were inspected by qualified inspectors, home insurance companies would have fewer claims and mortgage lenders would have less risk. "I believe it would be a big boost for the economy by creating more work for trades and services related to home improvements following the recommendations of home inspectors," Jacobs said.
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Blind Bidding: What an end to non-transparent bidding for real estate could look like

Article by Tiffany Foxcroft · CBC News · Posted: Oct 03, 2021 4:00 AM ET | Last Updated: December 30, 2021
"I think there are serious issues with the way we are conducting things right now," said Murtaza Haider, a professor of data science and real estate management at Ryerson University. Haider says an end to this way of bidding for real estate could have some impact on volatility in housing prices, but more importantly, "greater efficiency and transparency would bring more trust to the industry, and that should be a priority for the real estate sector." For Jeanhie Park, the experience of offering $230,000 more on a property than she needed to underlines the need for change.
"It would eliminate a lot of the deceit and misinformation that people receive when putting in an offer," she said. Park and her family went looking for a cottage in central Ontario this spring. Up against steep competition, they lost four bidding wars in a matter of weeks, so they were prepared when their real estate agent told them they were competing on the next property too. "We were advised to bid a couple of hundred thousand over list, and we just went a little bit over just because we wanted to get that property ... under the assumption that there were two other registered offers." Park later learned, through the listing agent, that there were actually no other offers. "We felt duped and manipulated," Park said. "The fact that there were zero registered offers, that we were misled with false information in order for us to put in our top price."
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More homeowners seeking litigation after buying without conditions, lawyer says

Article by Robyn Miller · CBC News · Posted: Nov 25, 2021 4:00 AM ET | Last Updated: November 25, 2021
A litigation lawyer says she's seen a "significant increase" in the number of clients who purchased a home with no conditions and are now seeking legal recourse for problems that popped up after moving in. There are clear risks to that decision, and for some, serious problems are found after they sign along the dotted line. "People get the house, they move in, they're all excited and they discover some big issue, whether it's a foundation issue, another structural issue and because of the way the law works and the 'buyer beware' principle, they're often stuck with it," said Erin Durant of Durant Barristers in Ottawa. The frenzied market puts pressure on buyers to inherit risk, such as holding back on conditions, to be competitive, but Durant says there is little legal recourse if something goes wrong.
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Dream home becomes nightmare for Ontario family who passed on home inspection

Article by Pat Foran CTV News Toronto Consumer Alert Videojournalist Published June 22, 2021 7:01 p.m. ADT
For many people, buying a home is the largest purchase they will ever make, which is why it's usually a good idea to have it checked by a home inspector first. An Ontario family who purchased their dream home said their experience has become a nightmare because of what they learned after waiving a home inspection. They lost a bidding war to buy the house in March of 2020, but days later the seller, who was also the listing real estate agent, contacted them to say they could buy it as long as they increased their offer and waived getting a home inspection. We found there is no well water being pumped into our house because there is no well water," Song said. Song said they had to install water holding tanks and other equipment in their basement at a cost of $10,000. Then, she said there were also major issues with the septic system and due to new environmental regulations, it's very expensive to replace.
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Home inspectors say buyers are 'in trouble' in hot housing market with inspections on the decline

Article by Katerina Georgieva · CBC News · Posted: May 31, 2021 6:00 AM ADT | Last Updated: May 31, 2021
Home inspectors in Ontario are sounding the alarm. Some say that in today's hot real estate market, more and more buyers are being pressured to make offers on homes without full home inspections. "It's like playing Russian Roulette with your finances and your home's finances and your family's finances," said Len Inkster, the executive secretary of the Ontario Association of Certified Home Inspectors, one of a number of groups representing workers in the field.
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