On July 21, 2022, the BC Government announced a Homebuyer Protection Period (HPP), also known as a “cooling off period,” to take effect on January 1, 2023.
The mandatory three-day period is intended to allow for buyers to secure financing and conduct home inspections after an offer is accepted. One of the key aspects of this HPP, is that buyers would face a penalty of 0.25 per cent of the purchase price (e.g., $2,500 on a $1,000,000 purchase) for rescinding upon an accepted offer.
Given how significantly the market has changed in recent months, the risk to buyers has been drastically reduced, which brings into question the potential long-term impact of the new policy. Protecting buyers (and sellers) is the primary concern of all industry stakeholders, including REALTORS and regulators alike, and any measure proposed to uphold this mandate should be determined through a robust and wholesome consultation process. We do not feel that the British Columbia Financial Services Authority (BCFSA)’s industry consultation was thorough, particularly as the Government’s announcement did not acknowledge nor contain any aspects of the REALTOR’s perspective on the matter.
We echo BCREA concerns that policies addressing market conditions should take into consideration the interests of all parties in a transaction, any changing market trends, as well as regional impacts, while considering any potential unintended consequences. They should also include a defined process to monitor and measure efficacy of the newly proposed policies.
FVREB will continue its dialogue and discussion with BCREA and will continue working through its Government Relations Committee to proactively urge the Government to review and refine their decision and to evolve yesterday’s announcement to achieve a level playing field and ensure the aims toward consumer protection are achieved.
We want to hear from you on this important issue. Please feel free to share your thoughts and perspectives by emailing us at: communications@fvreb.bc.ca.
Useful links:
- BC Government news release
- BCFSA’s Cooling Off Periods and Consumer Protection FAQ
- BCFSA’s consultation webpage
- BCREA’s update
Source: FVREB Communications