MORE TRANSPARENCY PROPOSED in the OFFER PROCESS

MORE TRANSPARENCY PROPOSED in the OFFER PROCESS
Currently in the multiple offer process in Ontario, offers are submitted to the seller, and only the seller and listing Realtor know the content of all the offers, as Realtors are prohibited by law from sharing details of any offer with other buyers bidding.
Buyers are frustrated at having to “guess” what price to offer to win the bidding war and sellers are often also frustrated that they can’t ask a buyer if they are willing to beat the current best offer. There have been increased calls to implement a transparency model, where all buyers bidding on a home would know what the best offer is and are given the opportunity to beat it.
It has been argued that the current process has added to the excessive price growth we continue to see in some areas of Ontario.
Recently iPro Realty asked consumers and Realtors in the GTA for their thoughts on offer transparency. More than 1,000 Realtors and 150 consumers responded, with the following results:
• 88 per cent of consumers think transparency should be allowed
• 72 per cent saying it should be mandatory
• 89 per cent of Realtors think there should be transparency
• Only 41 per cent of Realtors and 34 per cent of consumers think implementing transparency may have a cooling effect on the market.
Allowing the option for offer transparency doesn’t have to be complicated. Sellers, through their listing agent, could be allowed to disclose the best offer on the table to all competing offers, with all participants given an opportunity to resubmit their offer or walk away. This isn’t an auction process, it is keeping the process the same as it is today, but allowing Realtors to disclose the top terms of an offer to competing buyers, while personal information about buyer is kept confidential.
The auction process could also be an option as the more choices offered the better.
– Ted
Source REM Update