On August 1, 2021, BCFSA became the single regulator for the financial services sector in B.C., including real estate services. Ensuring public protection and promoting confidence in B.C.’s real estate market is a key priority. In an attempt to cool the province’s relentlessly hot real estate market, British Columbia (BC) just announced the introduction of a cooling off period come spring 2022 for home purchases
What is a cooling off period?
A cooling off period is an automatic cancellation period for contracts; a specific period of time in which you may reconsider your decision and cancel the contract—for any reason with no or diminished legal consequences. As a buyer this option will give you more time to do your due diligence with a property before having to commit.
Which transactions does the cooling off period apply to?
Currently, the cooling off period only applies to pre-construction condos. When the new legislation is introduced, it will apply to all residential sales in the real estate market (new builds and resales).
When will the cooling off period legislation come into effect?
The BC Financial Services Authority (BCFSA) will be consulting with key stakeholders and experts regarding the cooling off period and other potential protection measures for buyers. They are planning to have legislation in effect in the Spring of 2022.
What does this mean if you are a Seller?
If you are planning to sell a property once the cooling off period is in effect, things could look very different than selling in today’s current market. When selling under the new conditions, it will mean your property can be tied up for a period of time, while the Buyer decides to purchase (or not). If they decide not to move forward the deal will be collapsed, no questions asked. The seller will have to find a new buyer and repeat the process. Since unconditional offers will no longer be allowed, the selling process will take longer. If you are thinking of selling and plan to wait until Spring, it might be in your best interest to sell sooner before the new rules take effect.
