The Saskatchewan Realtors Association (SRA) is concerned with the Liberal Party’s proposed housing plan, which the organization says could criminalize the way Canadians sell their homes by banning blind bidding.
If re-elected, the Liberals would create a Home Buyers’ Bill of Rights “so that the process of buying a home is fair, open, and transparent,” its platform says. Of the seven objectives, banning blind bidding would prevent bidders from knowing the bids of other prospective buyers, which drives up home prices.
“As part of establishing a Home Buyers’ Bill of Rights, a re-elected Liberal government will convene federal and provincial regulators to develop a national action plan to increase consumer protection and transparency in real estate transactions,” the platform said.
The Liberal housing plan also includes reducing the monthly costs of mortgages and doubling the Home Buyers Tax Credit, while also building, preserving, or repairing 1.4 million homes in four years to increase the supply of affordable homes.
Blind bidding is where the real estate agent and client take offers and the possible purchasers don’t know what others submit for bids. The agent and client then open the bids and choose from one.
Another way to sell a home is through an auction — open bidding — method, where buyers know what other people are submitting for bids and can bid higher should they choose.
Regulating real estate professionals and practices through the Criminal Code of Canada will be difficult to accept for hard-working Canadians who choose how to sell their homes, said SRA CEO Chris Guérette. This is the “heavy-handed option” and pits homeowners against buyers when supply and the removal of barriers should be prioritized to help housing reach the market at the local level.
Federal parties do not have the authority to regulate how people sell their homes while removing blind bidding or anything similar will not affect housing affordability in communities, she continued.
“Housing is just a really local issue. I know they mentioned they would have to work with provinces, and I suspect that’s because they don’t want to have to put that in the criminal code. But I’m not sure this is a solution for Saskatchewan,” Guérette added.
She pointed out that Saskatchewan has a healthy housing continuum, which includes social housing at one end, luxury homes at the other end, and every other type of housing in the middle. A healthy housing continuum means there are different price points at which buyers can enter the market and move up or down that scale at different life stages.
“Frankly, compared to the rest of the country, I think others might be jealous. I mean, we always have to keep a watchful eye on that to make sure we maintain that health in the market, but no, we are not seeing the challenges in larger centres that many Canadian municipalities have … ,” she said.
For example, last year, it took six to 12 months to receive a building permit in Vancouver, whereas it took only a few days to do the same in Regina and Saskatoon, Guérette continued. That is why the Liberals should not ban blind bidding since it creates more red tape and does not affect affordability.
Affordability is about supply and demand; supply is an issue that municipalities can handle better than the federal government.
What the SRA wants to see are policies that help millennials jump into the housing market. Guérette pointed out this province has the highest percentage of millennials in Canada, which means affordability and choice are important for the population and future growth.
Three in four millennials do not own a home and need the help of their parents to purchase one.
“The proposed banning of blind bidding removes the ability for homeowners to sell their home the way they want,” Guérette added. “Saskatchewan homeowners, families and communities deserve better.”