Newmarket realtors are welcoming the option for open bidding in real estate, though some indicate the pricing impact could be minimal.
The Ontario Real Estate Association announced April 19 that the province had made regulatory changes to allow home sellers the option of making bid information open rather than keeping their exact bid details secret, as was previously required.
Newmarket realtor Jay Miller said he supports the idea of an open bid, as it can make the process fairer. But he added that ultimately he does not expect to see many sellers choosing this new option.
“In my experience, prices skyrocket through blind bids, and in my opinion, transparency will only mitigate the price escalation,” he said. “There might be some sellers who will allow the transparency to happen and go with open bids because they want to have increased fairness.”
The real estate association said it is part of a package of reforms it worked with the province to advance. The changes also include new enforcement powers for the Real Estate Council of Ontario to improve discipline on rule-breaking realtors.
Association president Tim Hudak said the bidding changes “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.”
Wasim Jarrah, a Newmarket realtor and an OREA director representing central Ontario realtors, said he fully supports the changes. But while it will improve transparency, it will not likely impact prices, he added.
“It would be a small percentage of people that will want to go through that process initially,” he said, but added "it’s great to give sellers that option.”
Miller said home buying can be emotional, with blind bids adding to that. Although buyers can look at data and comparable purchases, they can become invested in what they aim to buy.
“As much as we want to do business and be practical and be measured, you go into a home, and it’s going to be a place you can live,” he said. “In the process of trying to get that home, you’re connected to it.”
But when asked about mandating open bids, Miller said that could be going too far.
“Do I think that would temper things more? Yes, if it was mandatory, sure, of course. But forcing anybody to do anything, you can be crossing the line.”
Both welcomed changes to improve the enforcement of real estate law. Jarrah said with more than 96,000 realtors in the province, there will be some bad actors.
“The more powers that are given to RECO to address the professionalism, and to basically root out a lot of those bad actors, I think (is) absolutely great for the industry.”
Miller said housing supply is needed to address affordability. He added the Bank of Canada’s recent interest rate increase could help the situation, too.
“I’m hoping that we’re going to see some more supply with interest rates, and that will see a bit of tempering,” he said.
