Calgary Homeowners no Longer Have to Disclose Whether a Home Has Been Conditionally Sold

Calgary residents should start asking one key question when trying to decide whether to buy a home: Has the residence already been conditionally sold?

The Calgary Real Estate Board recently implemented a new rule that allows property owners to omit the "conditionally sold" sticker on "For Sale" signs, even after a conditional offer is in place. The property owner also has the option to hold off on reporting conditional sales through the Multiple Listing Service (MLS) system. The rules change allows homeowners to continue to market his or her property should the conditional sale fall through.

There were close to 13,200 single-family MLS sales reported in 2011 and close to 5,400 condominium sales, according to the Calgary Real Estate Board. That’s more than a 9 per cent increase in home sales and close to a 4 per cent increase in condo sales compared to the previous year.

The Edmonton Real Estate Board has had a similar policy in place. Deals that fall through for conditionally sold homes are relatively rare. But when it happens, it can have a negative impact on the property’s marketability. Potential buyers, for example, may question why the deal fell through and may turn their attention elsewhere.

Therefore, by leaving the property on the market while the sale is finalized, home owners are potentially opening up the pool of other buyers, should the current deal fall through.

The problem, though, is that the policy leaves open the possibility that a buyer will show interest in a property, only to discover later in the process that the respective property has already been conditionally sold.

The president of the Calgary Real Estate Board said the board wanted to update its rules.The new rule allows homeowners to hedge their bets. If an offer comes in, but both the home owner and the Realtor think the deal could fall through or that another, stronger offer could come in, they can now choose to continue showing the property and marketing it.

Conditional sales that fall through, though, are rare, real estate officials say. And most homeowners likely will stop marketing their home when a solid offer comes in, as is usually the case.

Nationally, Canadian homes cost about 20 per cent more than what is generally considered to be fair value, according to a new report by BCA Research.

Single-family home sales are expected to increase more than 12 per cent in 2012. Sales prices are expected to increase by about 2 per cent, according to CREB. Condo sales and average prices are also expected to increase in 2012, CREB predicted.