The BC Presale Buyer Guide

BCFSA, the provincial regulator, describes it this way: when you agree to buy a presale unit, you are purchasing the right to receive a completed unit at some point in the future. You typically pay an initial deposit when you sign and may owe further deposits on a schedule set out in the contract. The balance is due when the developer confirms the unit is ready to occupy.

BC gives presale buyers seven days to cancel a purchase contract without penalty. The seven days start on the later of the day you sign the contract and the day you give the developer your acknowledgement that you had the chance to read the disclosure statement.

To cancel, you serve written notice on the developer within that window. After the seven days, BCFSA says a purchaser can no longer cancel under this right, so the date you acknowledge the disclosure statement matters as much as the date you sign.

The seven-day right does not pass to someone who takes over your contract through an assignment.

A developer must meet preliminary approval requirements, assure title, utilities and services, and file a disclosure statement with BCFSA before it can market a unit. It may begin marketing as soon as the statement is filed, even before BCFSA has reviewed it. The developer must give you a copy, and any filed amendment, before you enter into a purchase agreement.

BCFSA points buyers to specific sections: estimated construction dates (section 5.1), estimated strata fees (3.8), strata bylaws (3.5), parking rights and availability (3.6), and your contractual rights and obligations and right to cancel (7.2). Read the statement and any amendments before you sign.

A developer must place a presale deposit with a real estate brokerage, lawyer or notary public, who holds it in a trust account in British Columbia. Because of that, deposits generally cannot be used to build or market the project. The exception is when authorized deposit insurance has been obtained, in which case the trustee may release the deposit to the developer.

New homes carry 5% federal GST, which resale homes generally do not. First-time buyers of a new home may recover the full 5% GST, up to $50,000, on a home priced at $1,000,000 or less, with a reduced rebate up to $1,500,000. The purchase agreement has to be signed on or after March 20, 2025 and before 2031, and you must not have lived in a home you or your spouse owned in that calendar year or the four before it. The regular GST new housing rebate is not available once the price reaches $450,000.

BC property transfer tax is 1% of the first $200,000 of value, 2% from $200,000 to $2,000,000 and 3% above that, plus a further 2% on residential value over $3,000,000.

The newly built home exemption removes the tax on a new home worth up to $1,100,000, with a partial exemption up to $1,150,000. You need to be a Canadian citizen or permanent resident, the home must be your principal residence, and you must move in within 92 days of registration and live there for the rest of the first year. It is not limited to first-time buyers. The first time home buyers' program removes the tax on the first $500,000 of value, an exemption worth up to $8,000, for a home worth up to $835,000, with a smaller exemption up to $860,000. It requires at least a year of BC residence before registration, or two BC tax returns in the last six years. You can claim one exemption, not both, so ask your lawyer or notary which applies before you rely on either.

On a presale strata home bought at arm's length, the tax is generally based on the total amount you paid, including upgrades and any assignment premium, rather than the value on the day the title registers.

An assignment transfers your presale contract to another person before it completes. BCFSA advises checking your contract for whether assignments are permitted, whether the developer must consent and whether a fee applies. A developer can refuse consent even when you have found a willing buyer, and if you then cannot complete you may be in default and at risk of losing your deposit.

BC's home flipping tax applies to profit from selling a home, or assigning a presale contract, held less than 730 days. The rate is 20% within the first 365 days and falls to zero by day 730. For a presale, the days count from the date you entered the contract. Developers report every presale assignment to the province's Condo and Strata Assignment Integrity Register.

BCFSA lists the main risks plainly. Completion can be delayed, or the project may never be completed, in which case the developer must return your deposit but owes no further compensation. A developer may change a unit's layout, including reducing its size, and may substitute materials of a similar nature and quality. If the appraised value at completion is lower than your price, your lender may offer less than you planned on. And if construction runs past a date set in the contract, the developer may ask for a higher price or let you cancel and take your deposit back.

If you cannot complete, a developer may pursue you for the difference between your price and the later sale price, its legal costs and administrative fees.

Home warranty insurance for new homes in BC covers materials and labour for 2 years (some limits apply), the building envelope, including water penetration, for 5 years, and structural defects for 10 years. The Homeowner Protection Act generally requires developers of new homes to provide it, and the disclosure statement explains it.

BCFSA warns that strata fees can come in higher than the developer's estimate, because insurance premiums and labour costs change, and that strata fees, home insurance and property taxes typically rise over time. Parking may not be included in the price. When it is available, it is usually allocated either as limited common property, with exclusive use noted on the strata plan, or by a parking lease agreement, and your rights differ between the two.

Mortgage financing for a presale is usually arranged closer to completion, often well after you sign, because lenders do not commit that far ahead. You can get pre-qualified early to understand your budget and revisit it as completion approaches, since rates and your finances can both change over a multi-year build. A mortgage broker can walk you through timing for your situation. This is general information, not financial advice.