By now you likely have heard all about the proposed BC Government legislation, known as The Cooling off Period, but formally called “Home Buyer Protection Period”, Bill 12-2022. The proposal will allow buyers to make five offers on five different properties and after the cooling off period just rescind four out of five with no real consequences, (how would you like to be one of those four?). The plan so far is to release a report with recommendations, this report will inform the development of regulations and will include details on; The length of the period, Financial penalties for buyers who rescind an offer, and regional variations in the legislation to address the differences between local house markets.
There are mixed views about a cooling off period, it could have unintended consequences. I worry about buyers making offers in bad faith, tying up sellers, causing undue hardship and potentially preventing sellers from purchasing their next home. Would you like to be in stuck in that situation?
The recommendation of a pre-offer period or a cooling up period has been talked about, where an offer can’t be presented to a seller on a new listing until the listing has been posted for five business days. This makes more sense as buyers would be afforded the time to do their due diligence, and then take the offers after this said time. This would help buyers decide if the offer would be in their best interests.
We’re already seeing a turn in the market with a steady stream of supply coming on to help balance the demand. We are seeing mortgage rates going up, that is pulling a lot of demand out of the housing market as it is. Ask yourself this, if you were selling your home, would you like to be in limbo as they are suggesting? Depending on the time period, you would now have to wait, in the meantime you are stressing out wondering about making your next move.
In the Fraser Valley the benchmark detached home hit $1.7 million in February 2022, and in Metro Vancouver, buyers were seeing an average price of $2 million. Will this new legislation really help address the concerns of buyers and sellers in the market? I will keep watching and listening to this debate as it unfolds.
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