Open Bidding: Will New Rules Cool Toronto’s Housing Market?

Ontario home sellers will soon have the option to disclose the amounts of competing offers, which is creating buzz among house-hunters, buyers, and sellers in the Greater Toronto Area (GTA). Open bidding provides more transparency in the home-buying process, but critics argue that it may lead to inflated final sale prices. However, rising interest rates, not open bidding, will cool the hot real estate market in the GTA. Studies from around the world suggest that increased bid transparency is associated with higher real estate prices, particularly in overheated markets, due to factors such as public bids creating a signal that a property is particularly valuable. Ultimately, the major factor driving up real estate prices is the low supply of housing not keeping up with demand. To ensure that housing is available and attainable for all Canadians, the federal government should focus on relieving the bottlenecks preventing an adequate supply of family-friendly, climate-friendly homes from being built.