After much controversy and negative reporting from the media, today the provincial government announced new rules regulating the assignment of real estate contracts for both residential, and commercial contracts, with the exception of development units as defined by section 1 of the Real Estate Development Marketing Act.

The new rules will require real estate contracts to include two terms:

1. The seller’s consent will be required in order to assign the contract.

2. Any profit from an assignment will go to the initial seller.

Clients can instruct REALTORS® to omit or change these clauses.

These regulations will apply to all offers starting May 16, 2016.

The buyer’s Realtor will also be required to inform the seller if one, or both, of these clauses are removed from their offer. The seller’s Realtor must also disclose if the proposed contract is assignable or not – including any conditions that would be applicable to the assignment.

Will this new requirement help quell the rapid home price increases Vancouverites have been witnessing? It may or may not, but at the very least it will hopefully help alleviate unsuspecting home owner’s from falling victim to deals that were shady with ulterior motives from the outset.