The meeting of the minds follows a move by the Quebec Federation of Real Estate Boards, a governing body that oversees 12 real estate boards in the province, to challenge the Canadian Mortgage and Housing Corporation over what it deems to be an ‘ethical breach’ in the organization’s policies regarding foreclosure disclosure, according to an article in the Financial Post.
The newspaper obtained documents revealing that CMHC had been asking Realtors to keep quiet about whether the home being sold is a foreclosure, disclosure normally considered mandatory.
A statement from the group said, “Because the repossession field is currently a mandatory field in the brokerage system you have no choice by to indicate ‘no’, which goes against ethical rules stipulating that real estate brokers are obliged to publish information that is truthful and verified.”
The CMHC stance has industry experts divided, with some wondering whether the corporation is hoping to dodge low-ball offers by avoiding disclosure, or preparing for a housing market collapse.
Ultimately the Crown corporation reached a compromise with the Quebec Realtors that removed any listing requirement around foreclosure status. That then leaves it up to the real estate professional to decide whether to put that fact on the MLS system for buyers, including investors, to see.
For investors, not knowing a deal is a foreclosure can make the difference between offering full asking price or going in with the kind of low offer many first try with distressed properties.
CMHC appears to be cognizant of the consequences of publishing its property holdings as foreclosures as opposed to having them lumped in with other for-sale properties.
Are you looking to invest in property? If you like, we can get one of our mortgage experts to tell you exactly how much you can afford to borrow, which is the best mortgage for you or how much they could save you right now if you have an existing mortgage. Click here to get help choosing the best mortgage rate