Offer Dates and Pre-Emptive Offers When Selling in Ontario

When you list a home, you may hear that offers will be reviewed on a set date, or that a buyer wants to make an early offer before that date. These are common marketing tactics, and they can feel stressful when you are the one deciding.

This article explains the terms in plain words and then focuses on what you can check before accepting any offer: who your agent is acting for, what you tell buyers, deposits and conditions.

What the terms mean

An offer presentation date, sometimes called an offer date, is a day you announce when you will review all offers together. A holdback means offers are held until that day. A pre-emptive or bully offer is an offer made before that day, usually on the basis that the buyer wants a quick answer.

These are practical approaches rather than rights. What you can do with an early offer depends on your listing agreement, any instructions you have given, and the terms of the offer itself. Talk through these points with your agent and your lawyer before you list.

Who is acting for whom

What you say to a buyer's side matters. If the buyer has a real estate agent and you do not, you are a self-represented party. The buyer's agent must act in the buyer's best interests and must pass on anything you tell them, including your price limits and motivations.

Before giving a self-represented seller any help, the other party's agent must give you RECO's Information and Disclosure to Self-represented Party form and walk you through it. That agent cannot give you services, opinions or advice. A self-represented party can become a client of a brokerage at any point in the transaction.

• Be careful about sharing your bottom line or your reasons for selling with a buyer's agent.
• Decide early whether you want your own representation.
• Ask your own agent how early offers will be handled before the listing goes live.

Information you give buyers

A seller property information statement is optional. If you prepare one for buyers, your agent must tell every interested buyer that it exists and must give a copy to any buyer who asks.

Buyers are advised to get their own inspection even if the seller has one. Ontario guidance describes a home inspection as not a pass or fail test, and after one a buyer may ask the seller for repairs, accept the defect, ask for a lower price, or decide not to buy. Expect those requests when a condition on inspection is part of an offer.

Deposits and conditions in an offer

Deposits are normally held by the brokerage. RECO's consumer deposit insurance covers up to $200,000 per claim and up to $4 million for all claims arising from a single event. Coverage depends on the policy terms and the facts of each case.

If buyer and seller disagree over a deposit, the brokerage can pay it out only under a mutual consent or release signed by both sides, or under a court order. If a brokerage has held a disputed deposit for two years with no determination, the deposit is transferred to RECO, which holds it in trust.

A condition giving the buyer sole and absolute discretion is still read together with any duty in the agreement to act in good faith and with due diligence. In one Court of Appeal for Ontario case, the buyer had to apply to the existing mortgagees in good faith before deciding in its sole discretion whether their terms were acceptable. So a condition is not a simple way out for a buyer, and the exact wording matters.

What to do next

• Read your listing agreement and ask how offer dates and early offers will be handled.
• Decide who will represent you and what you will and will not tell buyers.
• Have a lawyer review any offer, especially conditions and deposit terms, before you sign.
• Keep your instructions to your agent in writing so there is no confusion later.

Frequently asked questions