Thursday, July 13, 2023

Go to any media news site and you’re sure to find articles about the obsession Canadians have with real estate and their efforts to buy (or rent) a front door of their own.  

There are many theories, from serious to nonsensical. on why finding housing is a challenge. Today, I’m focusing on just one piece of part of the issue: namely, the level of trust buyers have in our profession and one step the Board has taken to improve that. (As an aside, if you’d like more information about what makes the real estate market tick, check out the informative videos of my colleague, economist Andrew Lis. This guy could make paint drying on a wall sound interesting.)

"If you’re in a profession, doing what you say you’ll do is paramount. People want to trust that you’re forthright and truthful. But it’s no secret the trust in our profession could be better. Even the prime minister has weighed in, giving a campaign promise that he would initiate a buyers’ bill of rights. Oh my. "

Despite efforts to improve our public approval numbers, there’s still work to do. Consider the current BC Financial Services Authority’s relicensing course—Ethics, Building Trust. And buyers and their agents asking questions like: 

  • “The seller’s agent told me they had five offers to present. How do I confirm that?”  
  • “How do I know my offer was presented?”  
  • “No offers for three months, and 10 minutes after I call the seller’s agent to let them know I have an offer, they tell me that now they have a second offer. What’s that about?”  

This feedback clearly tell us we need to do some work to build that trust from buyers when it comes to our offer process and communication. That’s why your Board has created the Disclosure of Multiple Offers Presented (DMOP) form. You must begin to use it as of July 17.   

"This form has been created not for your colleagues; rather, it’s for buyers who make offers on a property and the larger buying public. It’s intended to give buyers concrete information about the number of offers presented to the seller, along with the identity of the buyers’ brokerages whose offers were presented. "

The form is signed by the seller after all the offers have been presented and a decision has been made. Within one calendar day, it must be sent to all buyers’ agents and unrepresented buyers who submitted offers, whether or not the accepted offer is conditional. The form is intended to give buyers comfort about what happened and that their offer was presented. It’s a simple as that.  

Some have said they would like to see more information on this form, such as the details of the other offers and reasons for the seller’s decision. But that’s personal information of the seller and individual buyers, meaning it’s a bridge too far to reveal on a form because of privacy considerations. The DMOP form balances the interests of sellers and buyers by keeping individual information confidential while providing some general comfort to the buyers whose offers were presented.  

Keep the form in your file in case there are questions later about what happened, from the Board the BCFSA, or—heaven forbid—a lawyer.  

Canadians expect, when buying or selling real estate, to be given the straight goods, and they expect the process to be as transparent as possible.  

So give your clients as much information as you can. Manage their expectations by explaining to them how things work. And when possible, give them concrete evidence of what’s going on. The DMOP form will help you do that. 

I wish you the best.  

Top tips

Some members are asking whether they should identify the names of any unrepresented buyers on the DMOP form. The answer is no. As a colleague put it to me, “They’re specifically NOT to write the unrepresented buyer’s name on the DMOP. The column header says “Cooperating Brokerage Name” (or “Buyer Unrepresented”).” They’re to put “Buyer Unrepresented” in that column.”

Another member who had recently been involved in a multiple offer presentation with an unusually large number of offers to be presented, asked whether there might be some leeway for this scenario. The suggestion came in the hope the work necessary to prepare and send multiple DMOP forms to all the buyers’ agents and unrepresented buyers could be reduced if there were a relaxation. This is an understandable request. The Devil is always in the details. What number of offers would trigger (or not trigger) a disclosure form? For example, “14 offers triggers the form but 15 doesn’t.” A bit of a rabbit hole, I’d say.

Here’s a suggestion: prepare a “BCC” email message with the DMOP form attached. Add all the buyer agents’ and unrepresented buyers’ names to the BCC field and press “send,” meaning, one email message to multiple email recipients.

Remember to use the BCC field, and NOT the To or CC fields. This is critical, otherwise you’re disclosing too much information to everyone, including the contact information for each unrepresented buyer, which could put you offside PIPA.