The Ontario government is bringing forward new regulations, set to take effect next year, that would allow home buyers to see all competing offer prices -- but only if the seller agrees.
The new open bidding option would begin next April, the province confirmed. Under current regulations, real estate agents are required to share the number of bids, but are prohibited from sharing details of those competing offers. But starting next spring, with the seller's permission, agents can offer specifics on whichever parts of the bid the seller so chooses, meaning they can elect to share just the price, the closing date, or the financing conditions, or any preferred combination of the particulars.
"Sellers will no longer be limited to selling their property through a closed or traditional offer system," Minister of Government and Consumer Services Ross Romano said in a statement. "With these changes, hard-working Ontarians can rest assured knowing that our government has their backs as they embark on their journey of home ownership.”
The provincial announcement comes less than two weeks after the federal government included a plan to ban blind bidding nation-wide in its 2022 federal budget. Government at all levels have been pushing for increased transparency in real estate transactions amid rapidly rising home prices and fierce bidding wars. Both the federal plan and the Ontario one have received mixed reviews.
READ: Will Canada's Blind Bidding Ban Actually Happen? The Industry Isn't Sure
It's not yet clear how many sellers would opt to share this information, but Tim Hudak, CEO of the Ontario Real Estate Association, expressed his support of the province's decision, saying that it will bring more transparency to the home buying and selling process.
"The changes will make real estate transactions more open by allowing home buyers to see information about other offers being made on a home, provided the seller and other parties consent," Hudak said. "These changes were part of a package of reforms the Ontario Real Estate Association worked closely with the Province to bring forward, which strike 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."
The package of reforms also includes measures that would give regulators at the Real Estate Council of Ontario (RECO) new powers to go after "bad actors" by widening their jurisdiction to encompass the entirety of the provincial government's Trust in Real Estate Services Act.
"By giving RECO these powers, we’re streamlining and speeding up the process needed to resolve issues and ensuring real consequences for those acting in bad faith," Romano said.
There would also be a new Code of Ethics for real estate agents, as well as standardized real estate forms and stricter requirements for agents to disclose when a buyer and seller are using the same brokerage.
"Ontario realtors want to see North American-leading professionalism in the industry," Hudak said. "It’s too easy to get into the business and too hard to get kicked out. These changes will give RECO extra powers to throw the book at agents who are violating consumer trust. Tougher disciplinary measures will go a long way in ensuring that the realtors by your side during one of the most critical decisions of your life has the highest professional standards."
But not everyone is pleased with the proposed changes. In response, leader of the Green Party of Ontario Mike Schreiner said that simply offering the option of open bidding is not enough, as sellers will likely continue to withhold that information when given the choice.
“Home-sellers shouldn’t be able to pick and choose when the bidding process is transparent and when it is blind," Schreiner said. "That defeats the purpose of ending blind bidding, since it’s in sellers’ best interest to keep buyers in the dark."
