Some new measures have been proposed by the provincial government. The aim of these is to protect the rights of consumers during the buying process.
During the COVID-19 pandemic, we all watched the housing and mortgage markets heat up to unprecedented levels. One of the most common occurrences is condition-free offers.
Competition is high, and there were bidding wars everywhere. Many potential buyers are submitting offers without financing. This trend doesn’t seem to be slowing down, and we expect to see it remaining fierce throughout the end of this year.
The provincial government in British Columbia took steps to address the situation. The legislation allows buyers to back out of a sale. This is only allowed in a “cooling-off” period.
The legislation is nice, since people know they are protected while making such a big decision as purchasing real estate, which is also investing in their future. This is especially necessary during a time like this, when the housing market is heightened. People want peace of mind, and an assurance that they are making the right choices.
When We Can Expect The Legislation?
The legislation is expected to arrive in Spring of 2022 at the earliest. In the meantime, the steps for changing the current system remain unclear.
The intention of the move is to provide protection for consumers during purchasing processes. Some think this measure may stoke the BC housing market further than it already is. Realtors believe it will complicate the buying stage of the process, making it more difficult. If anybody can walk away at any time, it will make it hard for the realtor to make sense of the quality of what they are offering/listing or receiving.
At the buyer end of the spectrum, if buyers don’t have to show financial conditions, we can find other bidders increasing the purchase price or the size of a down payment. This will be bad for the already high house prices on the market.
Lenders have been slow to react and make adjustments. But they are aware of how commonplace, condition-free offers are, and that they are increasing in the marketplace.
If you want to own a home your alternative to buying is building your own. Here at Silver Beam Homes, we can help you with this dream. Call us today.