Earlier this month, the BC Government announced its intention to introduce a "cooling off" period for residential real estate transactions in BC next spring as well as consultation on several other practices that potentially pose a risk to consumers, including "blind bidding." On this special episode of Open House by BCREA, we welcome three guests to the show to help REALTORS® get a better understanding of the announcement: Dr. Paul Harrison shares his research into the effectiveness cooling off periods; BCREA Chief Economist Brendon Ogmundson shares his initial analysis of the impact of a cooling off period on BC's housing market, and Mike Moffat talks about whether there is evidence that supports the idea that banning blind bidding will slow real estate price growth.

This episode was recorded on November 23, 2021.

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Related Links:

Mentioned on this show:

• REALTORS® Invited to 2021 Standard Forms Post-Launch Q&A Webinar
• Cooling-off periods for consumers don’t work: study
• Banning Blind Bidding: Would it Slow the Growth in Canadian Real Estate Prices?

BCREA Resources on Cooling Off Period and Blind Bidding:

• BCREA Responds to Government Announcement on Cooling Off Period
• What is a Cooling Off Period? An Introduction for REALTORS®
• What is "Blind Bidding?" An Introduction for REALTORS®
• Community of Practice: Mandatory Cooling Off Period and Other Real Estate Transparency Measures (BCREA Access login required)

Background

Since early in the COVID-19 pandemic and peaking in early 2021, Canada and BC’s housing market specifically has experienced unprecedented conditions, with prices quickly escalating thanks to a perfect storm of record-low housing inventory and interest rates, increased household savings, an increased need, desire, and ability to work at home.

This has led to demand outpacing supply with many buyers left frustrated and, on the outside, looking in. With that frustration has come an intensified focus on the housing market from everyone from homeowners, prospective buyers, media and government officials. And along with that have come questions and calls for something to happen.

The Liberals, in the federal election campaign leading up to re-election, have promised a Homebuyers Bill of Rights, which – among other things – includes a promise to ban what is being called “blind bidding,” or changing the way the offer processes works in a transaction.

While here in BC, the provincial government has taken its lead from its federal counterpart and in November announced its intent to introduce consumer protection measures including a cooling off period next spring. It added it will also be looking at banning blind bidding, exploring mandatory home inspections and the use of subject free offers.

These announcements, without many details or full sector consultation as of yet, have left many of you asking questions. What can you expect? How will impact you and your clients? And will what’s being proposed actually change behaviour, slow price growth, or will it bring unintended consequences?

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