B.C.’s crackdown on shadow-flipping starts Monday
A “sold” sign hangs outside a home in this July 2012 file photo. (Richard Buchan / THE CANADIAN PRESS)
New rules designed to discourage the controversial practice of real estate shadow-flipping are coming next week, according to the B.C. government.
Premier Christy Clark said regulations requiring home sellers to give consent before their sale contracts are re-assigned will take effect on May 16.
“Government will not tolerate unethical or predatory conduct in the real estate market,” Clark said in a statement. “These rules will increase transparency and make sure that sellers’ best interests are protected.”
Under the new rules, any profit made by re-assigning a contract before the deal closes will also be given to the original seller.
The province said buyers can still get around those terms, but only if the seller is notified and agrees.
“The seller has the power to reject the offer and insist on one or both of the terms. Sellers must be advised to seek independent professional advice,” the Ministry of Finance said in a release.
The new rules won’t be retroactive, the government added. They will only apply to offers made on or after next Monday.
Anyone concerned about real estate licencees’ conduct is told to contact the Real Estate Council of B.C., the body responsible for enforcing the Real Estate Services Act.