BC Contract of Purchase and Sale: Complete Guide for Buyers, Sellers and Realtors (2026)
The Contract of Purchase and Sale (CPS) is the legal foundation of every BC real estate transaction. Understanding every clause — from subject conditions to deposit rules to completion dates — is essential for protecting your clients and avoiding disputes.
What Is the BC Contract of Purchase and Sale?
The Contract of Purchase and Sale (CPS) is the standard BCREA-approved agreement used in virtually every resale residential transaction in British Columbia. It is legally binding once signed by both parties and accepted (not just when subjects are removed — the contract is binding from the moment both parties sign, with the sale conditional on any subjects written into it).
The CPS governs:
- •Purchase price and deposit structure
- •Subject conditions (financing, inspection, strata documents)
- •Completion and possession dates
- •Included and excluded items (chattels and fixtures)
- •Title and title insurance requirements
- •Adjustments (property tax, strata fees, prepaid rents)
- •Default remedies for buyer or seller breach
The standard form is published by the BCREA and updated periodically. Realtors must use the current approved form — do not use outdated versions. Custom clauses can be added in the Additional Terms section, but modifying printed terms requires both parties to initial changes.
Clause-by-Clause Walkthrough
Clause 1: Parties and Property
Identifies buyer(s), seller(s), and the legal civic address and PID (Parcel Identifier) of the property. The PID must match the title exactly. A mismatch can cause title issues at completion. For strata properties, include the strata lot number, plan number, and civic address.
⚠ Realtor Watch Point: Verify PID against a current title search. Sellers sometimes list wrong PIDs, especially on bare land strata parcels or recreational properties.
Clause 2: Purchase Price and Deposit
States the total purchase price and the initial deposit amount. In BC, the deposit is typically held in trust by the listing brokerage (not the selling brokerage) until completion. The deposit is NOT a down payment — it forms part of the purchase price and is applied at completion. If the deal fails after subject removal, the deposit is generally forfeited to the seller unless a court orders otherwise.
⚠ Realtor Watch Point: Deposits are typically 5% in Metro Vancouver, 3-5% in other markets. Never release deposit to a seller before completion — BCFSA rules prohibit this. If the buyer has an initial deposit plus an additional deposit on subject removal, specify both amounts and timing.
Clause 3: Subject Conditions
The most negotiated section. Each subject must state: (a) what must happen, (b) by when (the subject removal date), and (c) who has the right to waive or not. Standard subjects include: financing approval satisfactory to buyer, home inspection satisfactory to buyer, title search satisfactory to buyer, and strata documents review satisfactory to buyer.
⚠ Realtor Watch Point: Always include 'in buyer's sole discretion' for buyer-benefit subjects. Otherwise, a seller could argue the buyer acted in bad faith when declining to remove. For financing subjects, specify lender, loan amount, interest rate, and amortization — a buyer cannot refuse to remove solely because rates rose slightly.
Clause 4: Subject Removal Date
The deadline by which all subjects must be removed or the contract terminates. In BC, the subject removal date is typically 7-14 business days after acceptance. If subjects are not removed by this date, the contract is void and the deposit is returned — no action required, it terminates automatically. However, both parties can agree to extend the subject removal date in writing.
⚠ Realtor Watch Point: Business days exclude weekends and statutory holidays. During holiday periods (Christmas, Easter, BC Day), add extra buffer. The 7-day rescission period for HBRP (3 business days) runs concurrently with the subject period — factor this into scheduling.
Clause 5: Completion Date
The date on which title transfers and funds are exchanged. The buyer's lawyer transfers funds to the seller's lawyer (via LTSA electronic submission), and title registers in the buyer's name. In BC, completion cannot occur on weekends, statutory holidays, or days when the Land Title Office is closed. Completion is typically the same week as or the day before possession.
⚠ Realtor Watch Point: Never schedule completion on the last business day before a long weekend — if something goes wrong, the delay costs all parties. Leave at least one business day buffer before possession.
Clause 6: Possession Date and Time
When the buyer receives physical possession of the property (keys). Standard BC possession time is 12:00 noon. Sellers must vacate before possession time and the property must be in 'broom swept' condition (clean, garbage removed, personal property out). If the seller has not vacated by possession time, the buyer can pursue legal remedies including compensation for delayed possession costs.
⚠ Realtor Watch Point: For occupied rental properties under the Residential Tenancy Act, possession may be weeks or months after completion — the seller must serve proper notice (2 months for landlord-use evictions). Disclose rental status clearly and ensure subject conditions include verifying the tenancy situation.
Clause 7: Included Items (Chattels and Fixtures)
Fixtures are legally attached to the property and are included unless excluded. Chattels are not attached and are excluded unless included. The grey area is substantial: curtain rods (fixture) vs. curtains (chattel), built-in speakers (fixture) vs. TV (chattel), garage door openers (usually included), satellite dishes (usually not). The CPS has checkboxes for common items: fridge, stove, dishwasher, washer, dryer, light fixtures, window coverings, garage door openers.
⚠ Realtor Watch Point: Always list exclusions explicitly. A seller who wants to keep a chandelier must write it in the Exclusions section. Disputes over chattels/fixtures are one of the most common post-sale complaints — better to over-specify than under-specify.
Clause 8: Adjustments
Financial adjustments calculated as of the completion date — property tax, strata fees, prepaid utilities, and pre-paid or unpaid rent. If the seller prepaid annual property tax and completes on July 1, the buyer owes the seller roughly half the annual tax. Adjustments are calculated by conveyancing lawyers and appear on the statement of adjustments at completion.
⚠ Realtor Watch Point: For strata properties, verify whether the strata has a special levy in progress. If a levy was passed before the completion date but not yet collected, the seller may owe it — get this confirmed in writing from the strata.
Clause 9: Title and Title Insurance
The CPS requires the seller to provide clear title — free of financial encumbrances (mortgages, liens, judgments) except those the buyer assumes. In BC, virtually all buyers purchase title insurance (from FCT, Stewart, or Chicago Title) to protect against title fraud, survey errors, and undisclosed encumbrances. Title insurance does NOT cover physical defects — it covers legal/registration issues.
⚠ Realtor Watch Point: Always recommend title insurance. The cost is low (~$150-400 one-time premium) relative to the protection. For commercial properties or rural land with easements/rights-of-way, have a lawyer review title before subject removal — not after.
Clause 10: Default and Remedies
If the buyer fails to complete (after subjects removed), the seller can keep the deposit and/or sue for damages including the difference between the contract price and the eventual sale price. If the seller fails to complete (e.g., refuses to close), the buyer can seek specific performance (court order to sell) or damages. Both remedies require legal action — deposits are not automatically released on seller default.
⚠ Realtor Watch Point: When a seller receives a better offer and tries to back out after accepting, they expose themselves to significant liability. Do not advise sellers to 'just back out' — they can be forced to sell by court order plus pay the buyer's legal costs.
Subject Conditions: The Most Critical Section
Subjects (conditions) are what differentiate a conditional offer from a firm offer. They protect the buyer's ability to verify what they are buying before being legally bound. Every subject must be carefully drafted — vague subjects create disputes.
Standard BC Subject Conditions: Best Practice Language
Financing Subject
"Subject to the buyer obtaining approval for financing of $_____ at an interest rate not exceeding _____% per annum, amortized over _____ years, on terms and conditions satisfactory to the buyer in the buyer's sole discretion, by [date]."
Specify lender type if relevant (e.g., 'Schedule A bank'). If the buyer is using a bridge loan or vendor financing, describe it specifically. A buyer cannot arbitrarily refuse financing approval if they received what was specified.
Home Inspection Subject
"Subject to the buyer obtaining, at the buyer's expense, a home inspection report by a licensed home inspector, the results of which are satisfactory to the buyer in the buyer's sole discretion, by [date]."
Do not limit the subject to 'major defects' — 'satisfactory to buyer in buyer's sole discretion' gives the buyer the right to withdraw for any inspection finding. Licensed inspectors in BC are regulated by Consumer Protection BC (HIABC). Recommend buyers attend inspections.
Strata Documents Subject
"Subject to the buyer reviewing and approving: (a) Form B Information Certificate; (b) current budget; (c) depreciation report or written explanation of why none exists; (d) minutes of strata council and general meetings for the past 2 years; (e) strata bylaws and rules; results satisfactory to the buyer in the buyer's sole discretion, by [date]."
Request Form B immediately after acceptance — sellers must produce it within 7 days of written request. Review minutes for special levies, litigation, insurance claims, major repairs. The depreciation report reveals reserve fund adequacy. For older buildings, request 3 years of minutes.
Title Search Subject
"Subject to the buyer searching title and the title being free and clear of all charges, liens, and encumbrances except as currently disclosed and except statutory building schemes and easements acceptable to the buyer in the buyer's sole discretion, by [date]."
The title search reveals registered mortgages (which must be discharged at completion), easements, statutory building schemes, and judgments. Buyers should instruct their lawyer to search title, not rely on the listing realtor. Encumbrances the buyer agrees to assume should be described specifically.
Sale of Buyer's Property Subject
"Subject to the buyer completing the sale of the buyer's property at [address] by [date]."
Sellers dislike this subject because it creates chain risk. When accepting an offer with this subject, the seller typically inserts a 48-72 hour escape clause: if the seller receives another acceptable offer, the buyer must remove all subjects within 48/72 hours or the seller can accept the new offer. This is colloquially called a '48-hour clause.'
Subject-Free Offers: Risks and Realities
A subject-free (firm) offer binds both parties immediately. There are no conditions — the buyer cannot withdraw without breaching the contract. In BC's competitive market periods, subject-free offers became standard in Metro Vancouver — creating significant buyer risk.
When Subject-Free May Be Appropriate
- ✓Buyer has pre-arranged financing with rate hold and approval
- ✓Pre-inspected property (inspection done before offer)
- ✓New construction with builder warranty
- ✓Cash purchase (no financing risk)
- ✓Buyer has reviewed strata docs before writing offer
- ✓Multiple offers situation where subject offers won't compete
Risks Buyers Accept
- ✗Financing falls through → deposit forfeited
- ✗Hidden defects discovered → no legal recourse (buyer beware)
- ✗Strata in financial distress → buyer is bound
- ✗Undisclosed title encumbrances → buyer assumes risk
- ✗Market drops before completion → buyer still must close
- ✗Property damage between acceptance and completion → negotiation required
BCFSA Guidance: Realtors must advise buyer clients of the risks associated with subject-free offers before writing them. Document this advice in writing. If a buyer insists on a subject-free offer over your objection, have them acknowledge in writing that they understand the risks.
The Home Buyer Rescission Period (HBRP)
Effective January 3, 2023, BC's Home Buyer Rescission Period gives residential buyers 3 business days after an accepted offer to rescind the contract by paying a 0.25% penalty. The HBRP was intended to give buyers time for due diligence in fast-moving markets.
HBRP Quick Facts
Completion Date vs. Possession Date
One of the most confusing aspects for buyers is that they do not get keys on the day title transfers. Here is how the two dates work:
Completion Date
- • Legal title registers in buyer's name at LTSA
- • Buyer's lawyer transfers purchase funds to seller's lawyer
- • Mortgage registers (if applicable)
- • Property Transfer Tax is paid
- • Discharge of seller's mortgage processed
- • Seller receives net proceeds
Possession Date
- • Buyer receives physical keys to the property
- • Standard time: 12:00 noon
- • Seller must have vacated and cleaned
- • All included chattels must be present
- • Utilities transferred to buyer's name
- • Final walkthrough recommended morning of possession
| Scenario | Completion | Possession |
|---|---|---|
| Standard (most common) | Day 1 (e.g., Tuesday) | Day 2 (Wednesday at noon) |
| Same-day (allowed) | Day 1 morning | Day 1 at noon |
| Occupied rental property | Day 1 | 60-90 days later (RTA notice period) |
| Seller needs time to move | Day 1 | Day 3-7 (seller rent-back arrangement) |
| Pre-sale new build | On occupancy permit issuance | Same day as completion |
Realtor Tip: Always advise buyers to schedule the final walkthrough the morning of possession — before handing over keys. Check that all included items are present, the property is clean, and no damage occurred since acceptance. If problems arise, document with photos and contact your managing broker before proceeding.
Deposit Rules in BC
How Deposits Work
What Happens to the Deposit If the Deal Falls Through
Subjects not removed (buyer)
Deposit returned to buyer in full
Buyer defaults after subject removal
Seller entitled to keep deposit; may also sue for damages
Seller defaults (refuses to close)
Deposit returned to buyer; buyer may sue seller for specific performance
Mutual agreement to cancel
Deposit returned per written release signed by both parties
Dispute over who gets deposit
Broker holds deposit pending court order or joint instruction
Common CPS Mistakes Realtors Make
Use precise, BCREA-approved language. Avoid 'subject to buyer's satisfaction' without 'in buyer's sole discretion' — courts have held ambiguous subjects are not truly conditions.
Search title before writing the offer. PIDs can be found on BC Assessment, Land Title Direct, or via a title search. A wrong PID can invalidate the contract.
Ask sellers before writing: 'Is there anything in the home you plan to take that a buyer might expect to stay?' Light fixtures, built-in shelving, mounted TVs, central vac, and garden sheds are common disputes.
Check the BC Statutory Holidays Act and LTO operating hours. Do not schedule completion on statutory holidays or the day after a 3-day weekend without explicit buffer.
The standard CPS includes 'time is of the essence.' This means all deadlines are strict — missing a subject removal date by even one day technically terminates the contract.
Don't just say 'strata documents satisfactory to buyer.' Enumerate each document: Form B, current budget, last 2 years of minutes, depreciation report, bylaws. Missing one could mean the subject doesn't cover what you think.
New homes attract 5% GST. If the buyer is purchasing a brand-new home, the contract must address whether GST is included or in addition to the purchase price, and who applies for the new home rebate.
PTT is payable by the buyer and is not included in the purchase price. While it doesn't need to be in the CPS, buyers (especially first-timers) must be briefed on this cost — it's not something that appears in the contract.
Realtor Scripts for CPS Conversations
Explaining the CPS to First-Time Buyers
"The Contract of Purchase and Sale is the legal agreement between you and the seller. It contains the price, any conditions you want to protect yourself with, and the dates — when we close legally and when you get the keys. Once both parties sign, it's a real contract, even before conditions are removed. But your conditions — like financing approval and the home inspection — are your protection. If we can't satisfy them, you get your deposit back and we walk away. Once conditions are removed, it's firm. That's when we move toward getting your keys."
Advising on Subject-Free Offers
"I want to make sure you understand what you're taking on with a subject-free offer. You're waiving your right to conditions — so if your financing falls through, you're still legally required to close, and you'd lose your deposit. We can mitigate this: I recommend getting your mortgage pre-approved with a rate hold before we write. I can also arrange a pre-inspection — we go see the property before the offer, and the inspector flags anything significant. It costs a few hundred dollars and potentially saves you from making a $900,000 mistake."
Explaining the Rescission Period to Sellers
"Once you accept an offer, the buyer has 3 business days where they can walk away and pay a small penalty — 0.25% of the purchase price. On a $900,000 home, that's $2,250. After 3 days, they can no longer rescind this way — they can only exercise their conditions if they wrote any. I know it feels like uncertainty, but this is the law now. The good news: most buyers who write an offer are serious. The rescission rate in BC has been very low. Think of it as 72 hours of due diligence before they're truly locked in."
When Subjects Are Not Removed
"The buyers have decided not to remove their conditions. Under the contract, the deal terminates automatically on the subject removal date. Your deposit — held in our trust account — will be returned to the buyers in full within a few business days. I know this is disappointing. Let's talk about your options: we can review the feedback from the buyers' agents to see if there's anything we can address before going back to market, or we can relist immediately while the market is still active."
Typical CPS Timeline
Buyer agent presents offer to listing agent. Seller reviews, counters, or accepts. Negotiations occur by counter-offer (new contract) or amendments.
Buyer may rescind for 0.25% penalty. Seller cannot accept other offers. Clock starts on acceptance date.
Buyer arranges financing approval, books inspection, reviews strata docs, searches title. Deposit typically paid within 24-72 hours of acceptance.
Buyer removes all conditions in writing (Subject Removal form) or contract terminates. Seller countersigns to acknowledge.
Buyer and seller each instruct their lawyers. Lawyers exchange documents, calculate adjustments, prepare transfer.
Title transfers. Funds move. PTT paid. Mortgage registers. Buyer owns the property.
Buyer receives keys at noon. Final walkthrough recommended beforehand.
Additional Terms: What Can (and Can't) Be Added
The Additional Terms section of the CPS allows both parties to customize the agreement beyond the standard printed terms. Common additions include:
Commonly Added Terms
- +Seller to provide professional cleaning before possession
- +Seller to complete specific repairs (with cost cap)
- +Seller to leave specific chattel (e.g., riding lawn mower)
- +Early occupancy arrangement (buyer occupies before completion)
- +Seller to provide depreciation report within X days
- +Seller's representation that tenants have received notice
- +Buyer's right to inspect property once before completion
- +Exclusion of specific fixture (e.g., dining room chandelier)
What Cannot Be Added
- ✗Waiver of HBRP (statutory right, cannot be contracted away)
- ✗Terms that violate BCFSA advertising rules
- ✗Discriminatory conditions (Human Rights Code)
- ✗Terms that give sellers access to deposit pre-completion
- ✗Modifications to printed form without initials from both parties
- ✗Unilateral escape clauses not in the standard form
Always consult your managing broker before adding non-standard terms. BCFSA can cite realtors for practicing law by drafting complex custom clauses — refer clients to their lawyers for anything beyond standard additional terms.
Frequently Asked Questions
What is a subject-free offer in BC real estate?+
A subject-free offer has no conditions — it binds both parties the moment it is accepted. Buyers assume all risk: failed financing, inspection issues, title problems. Common in Vancouver multiple-offer situations but carries significant buyer risk.
What happens if a buyer cannot remove subjects in BC?+
If subjects are not removed by the subject removal date, the contract terminates automatically and the deposit is returned to the buyer in full — provided subjects were correctly drafted. No court action is needed for the contract to terminate.
What is the 3-day rescission right in BC real estate?+
BC's HBRP gives buyers 3 business days after acceptance to rescind. The penalty is 0.25% of the purchase price (e.g., $1,875 on $750,000). It applies to most residential properties but not pre-sales.
What is the difference between completion date and possession date?+
Completion: title transfers and funds move. Possession: buyer gets keys (standard noon). Usually completion is one business day before possession. For rental properties, possession may be weeks or months later under the Residential Tenancy Act.
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