From, Realtor Terry Black
If you follow real estate, you likely have heard the term Blind Bidding. It’s when home buyers submit a bid (provide the seller a written offer to buy their property) expecting or having been told that their offer is in competition with one or more other buyers.
With today’s housing shortage in Canada including in Nova Scotia you may have heard of homes selling for tens of thousands or several hundreds of thousands of dollars above asking price. It is hard for first time buyers or for that matter any buyer at all to know what to expect when considering buying a home.
Is the list price the market value? Or is the home listed intentionally really low with a strategy to entice blind binding and create a buying frenzy to drive the sales price up? The news has been filled with stories of people not able to buy a home or even afford a place to rent.
The question has been asked probably of most Realtors and certainly of myself: “Can blind bidding be stopped?” As an alternative open bidding has been offered as a solution to our housing crisis. Open bidding is basically an auction. The challenge being not only has it not been proved to work in any other large market but it restricts the seller from deciding how to sell their property. It means big government in an aspect of society where thus far it has not been considered welcome.
So, with opinions on both sides, why not provide a measure of regulation without banning blind bids. Could we not have an independent review of all property transactions? A third-party review with a goal of determining one factor: Was there actually more than 1 written offer?
Certainly, the housing crisis is one of under-supply and high price combined. There are other factors, yes. After all the rhetoric I’m assuming whoever is in power September 20th they will seek to provide funding to build a great deal of new housing. But banning blind bidding will not stop some buyers from paying more money than others are willing to pay. Let’s have an independent review of every sales transaction for housing so that we at least know if there were more than one offer. That at least will bring a measure of trust into the process; a process that has become a very difficult one for a great number of Canadians.