“Blind bidding” has been a hot topic in the real estate world for years. This process allows homebuyers to submit their offers or bids on a home without knowing the bids of other prospective buyers, and is fairly common in particularly competitive markets.
While blind bidding is said to promote a sense of fairness (each buyer has an opportunity to submit their best offer without being influenced by the bids of others), many have criticized the practice and find it largely contributes to the inflation of home prices and overpaying for property – especially where inexperienced or first-time buyers are involved who tend to be less informed. In an effort to increase transparency, last spring the Ontario government announced it would give property sellers the option to “opt out” of the blind bidding process, allowing them to disclose the details of competing offers if they so choose. However, they did not ban the practice entirely, and introduced regulations only to give sellers the option to use an open-offer process to sell their property. Those regulations came into effect on April 1, 2023.
Some realtors and housing experts believe that this move was largely futile. If blind bidding benefits the seller, it does not follow that they would want to opt-out, and as such, if the government truly wants to achieve transparency it needs to ban the practice altogether. Others have pushed back against a full ban of blind bidding, claiming it would have a limited impact on reducing the high demand in the housing market and that sellers should retain the freedom to choose the method by which they sell their homes.