Proposed Ontario regulations that could make the home bidding process more open may not address what real estate experts say is the core issue with the market — supply.
The Ontario government is that, if passed, would give home sellers the option to share bids on their property and disclose the details of competing offers.
The move would in some instances end blind bidding, where competing bids on a home are not disclosed, with the heads of the Toronto and Ontario real estate associations saying this change would give sellers more options and provide greater transparency.
But will it effectively cool the market as some may hope?
"No," said David Fleming, a real estate expert and author of the Toronto Realty Blog, during a conversation with CTV's Your Morning on Wednesday.
"We have a supply issue, everyone is tired of hearing that, but we have a massive deficit between supply and demand. Those are economic fundamentals and you cannot work your way around that. I'm sorry for being the bearer of bad news."
The Ontario government's effort comes as the federal government attempts to introduce measures in its budget, which it hopes will make homebuying more affordable in Canada. Part of that also includes introducing a Home Buyers' Bill of Rights to end blind bidding and make sales more transparent.
Although he doesn't believe an end to blind bidding will cool the housing market, Fleming says it will make people feel more comfortable with the process.
"Real estate is expensive, we all know that, no one likes it," he said. "We've looked for somebody to blame or something to blame for a long time."
HOME SALES DECLINE IN MARCH
The news comes as the Canadian Real Estate Association reported that home sales in Canada fell in March by 16.3 per cent compared to the same month last year when they hit an all-time high.
Prices, meanwhile, were up 11.2 per cent last month from a year ago.
The actual national average home price was $796,068 in March, up from $715,696 the same month last year. Excluding Greater Vancouver and the Greater Toronto Area cuts $163,000 from the national average price for March this year, the real estate association says.
Month-over-month, seasonally-adjusted home sales in March were down 5.4 per cent.
The number of newly listed homes also fell 5.5 per cent month-over-month. The real estate association says this decline in new listings was led by Greater Vancouver, the Fraser Valley region in B.C., Calgary and the Greater Toronto Area.
Royal LePage's home price survey also shows that the national aggregate home price was up 25.1 per cent year-over-year in the first quarter of 2022 at $856,900, the highest gain on record.
The aggregate price of a home in Canada is now expected to increase 15 per cent in the fourth quarter of 2022, compared to the same quarter in 2021, Royal LePage forecasts.
Last week, the Bank of Canada also hiked its key interest rate by half a percentage point to one per cent.
SHORT SUPPLY THE 'ROOT PROBLEM'
Karen Yolevski, CEO of Royal LePage Real Estate Services, told CTV News Channel on Tuesday that despite a slight moderation in the market, this past first quarter was strong.
There still, however, is "unprecedented" demand, with high levels of immigration and more people looking to get in or move up in the market contributing to it.
While she understands consumers may want more information when buying a home, she says limiting blind bidding may not have an impact on demand or prices.
"The root problem we have is a shortage in supply and opening up the bidding process won't have an impact in creating more supply for consumers," Yolevski said.
Canada Mortgage and Housing Corp. says the seasonally-adjusted rate of housing starts came in at 246,243 units in March, compared with 250,246 in February.
The six-month moving average of monthly seasonally-adjusted annual rates of housing starts was 252,497 in March, down from 253,296 in February.
With files from CTV News Toronto and The Canadian Press
