A controversial sales tactic that involves wholesalers making unsolicited cash offers to homeowners is making some people a lot of money and making others very angry.
Ads have popped up promising homeowners that they can sell their home in 24 hours with no fees. Some are offering illegal services with wholesalers acting like Realtors — unlicensed and unregulated.
“These flyers from these real estate wholesalers are filling the inbox of my constituents, of people across the Lower Mainland. My question is, who is policing this? Who is looking into these practices? These are totally unregulated,” NDP housing critic David Eby said.
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Here’s how it works: an unlicensed wholesaler approaches a homeowner and offers a private cash sale with no fees. The wholesaler then assigns the contract to an investor and the unlicensed agent collects a lucrative fee of about 10 per cent.
B.C.’s superintendent of real estate, Carolyn Rogers, says her office is doing something about the problem and has shut down some individuals, but said it’s difficult for them to know if they have started doing business again under a different name.
Eby said the onus should not be on the homeowner to complain.
“It’s all reactionary,” Eby said. “It doesn’t seem to me that there’s anybody out there auditing records, looking into these things, making sure these rules are followed. The problem is a lot of these seniors who get ripped off — who get taken advantage of — don’t know that that happened.”
Rogers said she doesn’t have a police force at her disposal. Her investigations are complaint-driven.
With no signs of the market slowing down, it’s a case of seller beware.
“You should be cautious if you’re getting approached by people who specifically tell you, ‘I’m not licensed and that’s a good thing for you because you’re going to save money.’ You should be wary of that type of approach,” Rogers said.