Can You List Your House for Whatever Price You Want?
By Brian Madigan LL.B.
Misleading and False Advertising is dealt with under both the Competition Act (federal) and the Consumer Protection Act (provincial).
The federal Act deals with businesses not individuals.
The provincial Act deals with goods and services not real property.
The Real Estate and Business Brokers Act, 2002 also deals with false and misleading advertising but it only deals with registrants or the regulated real estate professionals. It does not regulate homeowners.
Here’s the problem. Bob bought his house 2 years ago for $479,000. It has appreciated inToronto’s hot market. He spent $15,000 to fix it up.
Now, he has instructed his real estate agent to list the property at $399,000. He has no intention of selling at that price, he just wants to create lots of interest and hopefully generate a “bidding war”.
Is this false advertising?
Sure, absolutely. But, he is not a business so the Competition Act does not apply. It’s real property, not “goods or services”, so the Consumer Protection Act doesn’t apply. And, the advertising guidelines under REBBA, 2002 do not apply to him, just his agent. Under agency law, it is the principal who has made the claim, not the agent.
Under contract law, at best this is simply an “invitation to treat”, or “submit an offer”. There is no corresponding obligation to sell.
So, false advertising or not, like it or not, that’s just the way it is!
Bob is free to list for any price he chooses, and is not obligated to accept any offers.
Brian Madigan LL.B., Broker is an author and commentator on real estate matters, if you are interested in residential or commercial properties in Mississauga, Toronto or the GTA, you may contact him through RE/MAX West Realty Inc., Brokerage 416-745-2300.
www.OntarioRealEstateSource.com
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