Premier Doug Ford's government is seeking input on how to bring into force recently passed protections for purchasers of new homes.
Until Sep. 16, Ontario's Ministry of Public and Business Service Delivery and Procurement will accept feedback from the public on how to implement a "cooling-off" period on purchases of new freehold homes and new transparency requirements for builders. The measures' fine-tuning follows the passage of Bill 200, the Homeowner Protection Act, legislation that Minister Todd McCarthy shepherded through the house this spring.
The 10-day cooling-off period that would apply to purchases of new freehold homes — which most non-condominiums are — would match a two-decade-old review period on condo sales. Once enacted for new freehold homes, buyers of new freehold homes will be able to legally back out of their purchase agreements with builders up to 10 days after the transaction is settled without being penalized.
The 10-day cooling-off period proposed by McCarthy's ministry would begin once a builder provides a buyer with specified paperwork informing them of their ability to back out of the agreement within that time. Builders violating these rules could be fined up to $50,000, matching the penalty under Ontario's Condominium Act.
Another related proposal the government is welcoming feedback on is to require the publication of information about freehold home purchase agreements that are terminated, including the reasons why a deal fell through. Similar information must already be published about cancelled condo purchase agreements as well.
"As we continue to build more homes, our focus remains on empowering Ontarians to make confident and informed decisions when purchasing a new home while also protecting their hard-earned money," Matthew D'Amico, a spokesperson for McCarthy, said about the proposals in an email.
A potential downside to the new 10-day cooling-off period and the accompanying new paperwork they're "expected" to add costs for homebuilders, according to the government's analysis.
A three-day cooling-off period on home sales that British Columbia's government put in place beginning in 2023 has also ruffled some realtors' feathers, according to reporting by Storeys, which covers Canadian real estate, and others.
Nevertheless, the Toronto Regional Real Estate Board and Ontario Real Estate Association both publicly expressed support for the Ford government's move to create a 10-day cooling-off period for purchases of new freehold homes. New Democrat and Liberal MPPs each also expressed support for the policy during the debate of Bill 200.
"The parts of the bill pertaining to the freehold home extension with regard to the cooling-off period is, in fact, an amendment that we introduced to the (Consumer Protection Act), and we thank you for listening to us and for it appearing in the bill," NDP MPP and consumer protection critic Tom Rakocevic said in the legislature on June 5.
"This bill does get some things right," Liberal MPP Adil Shamji added, referring to the cooling-off period.
After the Ford government's public consultation period ends in mid-September, it could be months or more before it implements its new homebuyer protection measures. "The ministry anticipates that the changes, if approved, would come into force in 2025," it said in a consultation paper.
