‘Great refresh’: raising consumer protection via modernized real estate forms

For the first time in roughly three decades, Manitoba’s real estate industry has updated key documentation in the homebuying process.

Proponents are touting new offer to purchase forms as more easily understandable and better for consumer protection.

“You don’t have to go through that ‘Choose-your-own-adventure contract’ that we had before, where you had to read it really carefully and fill in the blanks,” said Erika Miller, Manitoba Financial Services Agency’s communications manager.

A committee — including the MFSA, Manitoba Real Estate Association and Manitoba Bar Association — spent two years crafting the updated offer to purchase forms.

Such papers are used during every sale of a used home. The new versions will launch on Saturday with a number of changes.

The most obvious might be listing conditions — in plain language — in the first half of the form, rather than placing conditions in legal terms throughout the document.

“It was tough for people to read,” Miller said. “You had to read through everything really carefully to make sure you were writing things in the right spot.”

Greater details in legal speak comes in the back half of the form.

Also new: sellers must disclose if proper building permits were used during renovations and they must clearly specify components’ conditions, such as the state of an included dishwasher.

Real estate agents will highlight on the first page whether they’re selling to themselves or a family member and who they’re representing — buyers, sellers or both — during the deal.

Meantime, sellers must share if they’ll be considered a non-resident of Canada under the Income Tax Act on the possession date.

It’s become “an increasing trend and problem,” said Akash Bedi, a director with the Manitoba Real Estate Association and a long-time real estate agent.

Non-residents require extra paperwork from the Canada Revenue Agency for tax purposes, Bedi explained.

He and fellow agents took mandated training through the MREA in advance of the new forms’ unveiling. November is a good month to launch, Bedi said: “Typically, the real estate market does taper off towards the end of the year.”

There’s time for professionals to better understand the paperwork, Bedi added.

“I think the forms are a great refresh,” he said. “(It) makes it easier for the public to fully understand what they’re signing, and understanding that transaction process.”

E-signing will be an option, Miller said. The industry has waived the requirement of having a witness signee.

Voluntary property disclosure statements were introduced in 2011. The documents remain voluntary; now, however, they’ll focus on sellers’ knowledge of the property and require full explanations when sellers don’t have answers to questions.

Buyers needn’t get into mortgage details, like max interest rates, in the contracts. Instead, they state the approximate amount of their mortgage if they’re getting one.

gabrielle.piche@winnipegfreepress.com