The Real Estate and Business Brokers Act, 2002 (“REBBA”) was recently amended\u00a0to address the issue of \u201cphantom offers\u201d \u00a0in the real estate market.<\/p>\n
Prior to July 1, 2015, when a potential buyer made an offer on a home, there was nothing preventing the seller’s agent from advising that there was a competing offer, when there wasn’t.<\/p>\n
This tactic would often cause potential buyers to raise the purchase price offered.<\/p>\n
The amendments to REBBA prohibit agents from advising that an offer has been received unless it is in writing and signed.<\/p>\n
It also requires real estate brokerages to retain copies\u00a0of the bidding history for a property.<\/p>\n
The intent of these amendments is to make real estate bidding wars more transparent.<\/p>\n
The new legislation is meant to prevent offers that are talked about, but never materialize, from artificially raising the price.<\/p>\n
If you require assistance with respect to suspected phantom offers, or for any other real estate law matter, please contact one of the real estate lawyers at Daniel & Partners LLP<\/a>.<\/p>\n