How offers work in Ontario: conditions, deposits, bidding

In Ontario, buying a home starts with a written offer: the price, the deposit, the closing date, what is included, and any conditions you need, such as financing or a home inspection. If the seller signs it as written, you have a binding agreement. If several buyers are competing, the seller's agent must tell each buyer who made a written offer how many competing written offers there are, but the content of offers is shared only when the seller gives written direction. There is no cooling-off period on a resale home; only buyers of new condominium units from a developer get 10 days to change their mind.

These rules come from the Trust in Real Estate Services Act, 2002 (TRESA), whose newer provisions took effect on December 1, 2023, and are enforced by the Real Estate Council of Ontario (RECO). Here is how each part works.

What goes into an offer?

An offer, once signed by both sides, becomes the agreement of purchase and sale. The key terms:

• Price and how it will be paid.
• Deposit: the amount, and when and to whom it will be delivered.
• Closing date: the day ownership transfers and you get the keys.
• Inclusions and exclusions: chattels and fixtures that stay or go, such as appliances, window coverings, a dock or a boat lift.
• Conditions: anything that must be satisfied for the deal to go firm, each with a deadline.
• Irrevocable date: how long the seller has to respond before your offer expires.

The seller can accept, reject, or sign back with changes. A sign-back is a counter-offer, and you can accept, reject or counter again.

Which conditions should I include?

Conditions are your safety valves. Each one gives you a set number of days to check something, and if it does not work out, you can walk away and get your deposit back, according to the wording.

Condition	What it protects	Notes
Financing	Your lender approving this property	RECO says pre-qualifying does not safely remove the need for one
Home inspection	The condition of the house	RECO calls skipping it a significant risk
Sale of your property	Selling your current home first	Sellers often add an escape clause
Septic inspection	The system's condition and capacity	Standard on rural homes
Well water quality and quantity	Safe, adequate water	Standard on homes with private wells
Status certificate review	A condo's finances and rules	Your lawyer reviews it
Insurance	Getting home insurance at a workable cost	Useful with woodstoves, oil tanks or distance from a fire hall
Lawyer's review	Legal review of the agreement	Common when terms are unusual

Rural and waterfront conditions

Lake-country homes often need more. A septic inspection and water testing are routine. On waterfront, add a review of the survey and whether the shore road allowance has been closed. On acreage, you may want to confirm zoning or severance potential. See the rural property checklist, shore road allowances and zoning and severances.

Firm offers

A firm offer has no conditions. It can be more attractive to a seller, but it shifts all the risk to you. If you are considering one, get your financing fully approved on that specific property where possible, and do a pre-offer inspection if the seller allows it.

How do deposits work?

The deposit shows the seller you are serious. There is no legal minimum; it is negotiated. It is usually delivered within a short period after acceptance, often to the listing brokerage, which holds it in trust until closing. On closing, it is credited toward your down payment.

If your offer is conditional and a condition is not met, the agreement usually says the deposit is returned in full. If you back out of a firm deal without a legal reason, you can lose the deposit and may be liable for more. Your lawyer should explain the deposit terms before you sign.

What happens in a bidding war?

The number of offers

When there is more than one offer, the seller's agent must tell every buyer who has submitted a written offer how many competing written offers there are. A verbal offer is not a competing offer under the legislation. If you made an offer, or your agent did on your behalf, you can ask RECO afterwards to confirm the number of offers; RECO will ask the seller's brokerage to confirm the number received and conveyed to the seller.

The content of offers: the open-offer option

Since December 1, 2023, a seller can choose to share the content of offers with competing buyers. RECO's guidance:

• The seller must give written direction before any offer content is shared.
• What is shared may be limited to selected parts and may or may not include the price. You should not assume you will be told the other prices.
• Personal or identifying information in offers can never be shared.
• The seller can change their direction at any time, so you may not know in advance what will be shared.
• The legislation does not set rules for how an "open offer process" must be run.

If you do not want your offer's content shared, tell your agent. RECO says your agent can explain the steps to take to avoid it.

Pre-emptive offers

Many listings set an offer date. You can still send an offer before it, called a pre-emptive offer or "bully" offer. RECO's Bulletin 4.3 says the seller's agent must convey offers to the seller as soon as possible after receiving them, unless the seller has given clear written direction otherwise. So the seller will normally see your offer, but they are under no obligation to consider it before their offer date.

Keeping your head

RECO cautions that in competing offers, buyers can be tempted to offer more than they planned or drop protective conditions, and that a competing-offer situation does not necessarily mean a property will sell above the asking price. Decide your maximum before offer night, and decide which conditions you will not give up.

Is there a cooling-off period in Ontario?

Resale homes: no

For resale homes, freehold or condo, there is no legislated cooling-off period. The Government of Ontario confirms this for resale condos. Once your offer is accepted, you can only get out of the deal under a condition written into the agreement.

New condos from a developer: 10 days

If you buy a new or pre-construction condo unit from a developer, you can cancel within 10 days of receiving the signed agreement of purchase and sale, the disclosure statement and the condo buyers' guide, for any reason. The developer generally must refund your deposit plus any interest payable. You can also cancel within 10 days of being told of a material change to the disclosure statement. Ontario describes this as 10 days, and Tarion describes it as 10 business days, so confirm the exact window in your agreement with your lawyer.

New-home deposits have their own protections through Tarion. Ask your lawyer to review any builder agreement before the cooling-off period ends.

What can agents tell you, and what can't they?

The agent working for the seller

The seller's agent works for the seller. They must tell you the number of competing written offers if you submitted one. They cannot share the content of other offers without the seller's written direction, and they can never share other buyers' identities.

Your own agent

Your agent works for you and owes you their best advice. Under TRESA, buyer agents must tell their clients that a seller may choose to share offer content, so you can decide how to handle it.

Buyer representation agreements and the RECO Information Guide

The written agreement

RECO says a representation agreement must be put in writing and presented to you as soon as possible, and that you should not expect an agent to provide services without a signed agreement. The agreement must:

• describe the services you will receive, your rights and responsibilities, and what you will pay,
• clearly identify how the amount you pay will be determined, and
• show its expiry date prominently on the first page.

Read the termination terms and any holdover clause, which could mean you owe a fee after the agreement expires. Also be aware that RECO warns a representation relationship can be implied just by how an agent acts with you, so be clear from the start about who is working for you.

The RECO Information Guide

Since December 1, 2023, brokerages must provide and explain the RECO Information Guide before providing services, and make best efforts to get your acknowledgement that you received it. You can read it on RECO's website before you meet with any agent, which is a good way to know what to expect.

When one brokerage represents both sides

If the brokerage representing you also represents the seller, that is multiple representation. It is only allowed with mandatory written disclosure, and each client must decide whether they agree and consent. RECO notes that in this situation, none of the clients are fully represented. For buyers, that disclosure should come before you enter the agreement, not at the offer stage.

Buying without an agent: self-represented parties

You can buy without an agent. If you deal directly with the seller's agent, you are a self-represented party. The agent must give you RECO's Information and Disclosure to Self-represented Party form, explain it, and make best efforts to get your acknowledgement. Read it carefully: the agent's client is the seller, and the form sets out what that means for you.

If you go this route, have a real estate lawyer review the offer before you sign it, not just before closing.

If you expect competition, do the work before offer night, not on it:

• Have your pre-approval current and your deposit ready to deliver by the deadline in the agreement.
• Ask the listing agent early how offers are being handled, whether there is an offer date, and whether the seller will consider pre-emptive offers.
• If you are thinking of going without an inspection condition, book a pre-offer inspection instead of skipping it.
• Decide your top price and the conditions you will not give up before you sit down, so the evening does not make the decision for you.

How Jordan can help

Jordan can walk you through each condition and which ones fit the specific property, especially on rural homes with septic, wells and shoreline questions. He will explain how the seller has chosen to handle offers, and give you a written buyer representation agreement that sets out his services and what you pay, with the RECO Information Guide, before you start. Call 705-345-0797.