CALGARY — There could be fewer conditionally sold stickers on for sale signs in Calgary’s real estate market this year.
Not because of declining sales, though.
A new rule change implemented by the Calgary Real Estate Board gives the seller of a property the option of keeping the conditionally sold sticker off the sign when there is a conditional offer. As well, the seller has the option to not report the conditional sale through the MLS system.
“Before it was the real estate board’s rule that once a property was conditionally sold you had to report it to the board and on the MLS system,” said realtor Doug Battershill with RE/MAX House of Real Estate in Calgary. “What the board has done now is give sellers the option because the real estate board wants to let sellers make the best decisions for them.
“There are positives and negatives to changing it or not changing it and that’s where the discussion with your realtor and your circumstances comes into play. Sellers do now have the opportunity to decide if they want to report it as conditionally sold or not.”
For sellers, not reporting a conditional sale it allows them to continue to market their property and have a ‘backup’ offer in case the conditional sale falls through. But for potential buyers, without knowing that a property is conditionally sold, it could cause them grief and time lost looking at a property that really isn’t available.
According to the Calgary Real Estate Board, in 2011 there were 13,186 single-family MLS sales in Calgary, up 9.06 per cent from the previous year, and 5,382 condo sales, an increase of 3.98 per cent from 2010.
Battershill said the Edmonton Real Estate Board has had the same policy for some time. He said not many conditionally sold deals fall apart but when they do it potentially hurts the property’s marketability because other potential buyers wonder why the deal did not go through. Was it a matter of financing or a bad home inspection?
“If you have a really hot property, you have a hot new listing, or you’re getting a lot of action on the property by not taking it off the market as conditionally sold, you may get more calls from buyers that might see it online and you may get more calls from realtors who want to show it,” said Battershill. “So what you’re doing is leaving the door open to get more activity or to get potentially back up offers if the property is in high demand or it’s a very unique property with a lot of interest.”
The negative is that some potential buyers will see properties on MLS and show interest in them only to discover they are conditionally sold, he said.
Sano Stante, CREB’s president, said the board has simply brought its rules up to date.
“The custom still is that when you have a good sound offer on your house you likely will not continue to show it and market it,” he said. “But if you consulted with your realtor and you decided that perhaps the offer maybe wasn’t the strongest or there was a possibility of the condition not being fulfilled you might decide to continue to market it while there was a condition on it.”
In the majority of cases that probably won’t occur, he said.