Subject Matter of the Lobbying Activity
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Specific Topics of Lobbying Communications
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Intended Outcomes
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Associated Subject Matters
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IMPROVING CONSUMER PROTECTIONS
Due to market conditions, buyers may feel the need to purchase a home without conducting due diligence. REALTORS® share the government’s objective of increasing protections for homebuyers; however, we are concerned about the government’s framework in the Property Law Amendment Act, which will establish a right for purchasers to rescind (also known as a “cooling off period”) on their contract of purchase of sale for all residential real estate transactions.
ENHANCE THE REAL ESTATE TRANSACTION FRAMEWORK
Implementing a “cooling off period” is not the answer to this problem, as it does not provide more time for a buyer to consider a decision prior to making an offer. According to recent polling, only 35 per cent of British Columbians support a "cooling off period." Additionally, a majority of Realtors are concerned that if a “cooling off period” is implemented:
• it would worsen affordability by increasing the number of offers,
• it could worsen supply, as buyers with multiple accepted offers effectively remove properties from the market for the duration of the cooling off period,
• consumers will look for work arounds, which may lead to more unrepresented parties,
• there is a lack of metrics to understand the effectiveness of a “cooling off period,”
• the impacts will be significantly different in a seller’s market compared to a buyer’s market,
• there will be an imbalance between the rights of buyers and sellers,
• there will be an increase in frivolous offers,
• if used indiscriminately by buyers, a “cooling off period” could tie up multiple houses in a neighbourhood.
RECOMMENDATIONS
1. If a "cooling off period" is implemented, create an exemption for situations where both the buyer and seller agree to waive their right to rescission.
There are many instances where a mandatory rescission period would not make sense, such as if a property needs to be sold as quickly as possible as a result of divorce, health problems, or other unexpected instances. In these circumstances, if both the buyer and seller have a clear understanding of the risks they are taking, they should be able to sign a waiver allowing themselves to be exempt. In addition, properties sold by auction negate the need for a mandatory rescission period, similar to what is already in place in Australian states.
2. Engage in further consultation with BCREA and real estate stakeholders to understand appropriate parameters for a “cooling off period.”
To utilize the knowledge and expertise from within the sector, continued government engagement is necessary with BCREA, member boards and other real estate stakeholders prior to implementing a "cooling off period." Making the BC Financial Services Authority’s report public when it is finalized and conducting a review of the measure after six months of implementation will allow BCREA and other real estate stakeholders to have more fulsome knowledge on how to best work with the government in understanding parameters and necessary exemptions.
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- Development of any legislative proposal by the government of British Columbia, a Provincial entity or a member of the Legislative Assembly
- Development or enactment of any regulation, including the enactment of a regulation for the purposes of amending or repealing a regulation
- Development, establishment, amendment or termination of any program, policy, directive or guideline of the government of British Columbia or a Provincial entity
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Consumer Issues, Housing
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IMPROVING HOUSING AFFORDABILITY
REALTORS® are concerned about escalating home prices out of the reach of many British Columbian families. Rising housing prices are caused by a mismatch between supply and demand. New listings activity is not keeping up with sales and, as a result, 2022 began with the lowest level of active listings on record for BC. These trends caused the average residential home price on the Multiple Listing Service (MLS®) to rise 24.9 per cent in March 2022 compared to the previous year.
According to a January 2021 survey of unsuccessful homebuyers in BC, the most common reason for their unsuccessful purchase was competition from other potential buyers (49 per cent), followed by inadequate financing (31 per cent). The largest issue that arose from successful homebuyers was pressure to make an offer uncomfortably above the list price in order to be competitive (22 per cent).
The BC Government has already established a framework to address affordability issues through the Development Approvals Process Review (DAPR) and the Canada-BC Expert Panel on the Future of Housing Supply and Affordability (Expert Panel). The Expert Panel is clear that, “simply put, BC needs to build the many additional homes required to adequately house a growing population and economy.”
We are encouraged that the government recognizes the importance of improving housing supply and that the status quo is not acceptable. Positive first steps have been made, including introducing the Transportation Amendment Act, which will allow the province to acquire land for the purpose of building housing near transit stations, to increase housing supply along future transit corridors.
RECOMMENDATIONS
1. A provincial policy review to consider tying development approvals to housing targets.
This recommendation is forwarded by both the DAPR report and the Expert Panel. By tying development approvals with housing targets, such as an Official Community Plan or Housing Needs Report, building approval processes can be expedited, reducing housing costs and allowing supply to react more quickly to demand shocks. Both the Ontario and Alberta governments have passed legislation that caps the maximum allowable time limits on each stage of the development approval process. In both provinces, these limits are enforced by independent tribunals based on development applicant appeals. Tying development approvals to housing targets can reduce barriers to housing and accelerate the construction of the homes British Columbians need.
2. Establish a permanent housing roundtable.
A provincially-led housing roundtable could bring together local governments and key housing market stakeholders to help address challenges with an inclusive and innovative approach. Working to improve housing affordability requires ongoing conversations and a toolkit of policies. Each region of BC and Canada has unique market conditions and governing regulations must be recognized and integrated as part of this approach. The BC Government should convene a permanent housing roundtable that includes market and non-market stakeholders and civil society organizations with a focus on how best to implement the DAPR report and Expert Panel recommendations.
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- Development of any legislative proposal by the government of British Columbia, a Provincial entity or a member of the Legislative Assembly
- Development or enactment of any regulation, including the enactment of a regulation for the purposes of amending or repealing a regulation
- Development, establishment, amendment or termination of any program, policy, directive or guideline of the government of British Columbia or a Provincial entity
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Consumer Issues, Housing
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