In a notoriously hot and challenging real estate market, the province is trying to make some changes to help homebuyers. On Monday, March 28, the province announced that changes introduced to the Property Law Act are paving the way to create a new Homebuyer Protection Period that could strengthen protections.
The province said that the Homebuyer Protection Period is a response to concerns raised about the local real estate market, where competition is extremely high and buyers could be pressured into submitting offers on homes without having basic conditions met to protect them.
Now, the province is set to create a “cooling off” period, which will give people who are buying a home more time to think about their offer. It will also give them the time they need to secure financing and get a home inspection, instead of waiving these conditions under pressure.
According to the province, real estate industry reps estimate that more than 70% of offers in the last year were made without conditions, which can land the homebuyer with extensive repair and renovation costs.
“People need to have protection as they make one of the biggest financial decisions of their lives,” said Selina Robinson, Minister of Finance, in a release.
“In our overheated housing market, we have seen buyers feeling pressure to waive conditions just to be considered, and new homeowners discovering costly problems only after a deal has closed.”
“We want to make sure people buying a home have time to get the information they need to make a sound decision within limits that still give sellers the certainty they need to close sales.”
Paul Taylor, president and CEO of Mortgage Professionals Canada, said in the release that introducing “a short, unrestricted cooling-off period or a separate, longer period to ensure appropriate financing can be arranged would remove uncertainty from home purchases and sales, and potentially save both buyers and sellers considerable costs over time.”
Right now, the BC Financial Services Authority (BCFSA) is analyzing the consultation with the province and real estate industry stakeholders. Next, it will help develop regulations, and its goal is to have protection measures in place for homebuyers by this summer.
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