BC Realtor Presale Condo Guide: REDMA, Disclosure Statements, Assignments & Cooling-Off Period (2026)
BC's presale condo market is unlike any other transaction type — buyers commit to purchasing a property that may not be built for 3–5 years, based on floor plans and renderings. REDMA (Real Estate Development Marketing Act) creates a distinct legal framework governing disclosure, deposits, rescission, and amendment. This guide covers everything a BC realtor needs to guide presale buyers and sellers competently, including REDMA obligations, the 7-day cooling-off period, assignment mechanics, deposit protection, and 6 client conversation scripts.
What Is a Presale Condo in BC?
A presale (also called a pre-construction purchase) is a contract to buy a strata lot — most commonly a condominium unit — before the building has been completed and the strata plan registered. The buyer purchases based on plans and specifications, pays a series of deposits over time, and takes possession (completes the purchase) when the strata plan is registered, often 2–5 years later.
Presale vs. Resale — Key Differences
| Aspect | Presale | Resale |
|---|---|---|
| What you're buying | A contractual right to purchase a future strata lot | An existing, completed property with registered title |
| Governing legislation | REDMA (Real Estate Development Marketing Act) | Law of Property Act, Real Estate Services Act |
| Governing document | Developer's disclosure statement | Property Condition Disclosure Statement (PCDS) |
| Rescission right | 7-day statutory cooling-off period | Subject conditions only (financing, inspection, etc.) |
| Deposit rules | Designated trust account; REDMA protections | Trust account (RESA); fewer statutory protections |
| Completion timeline | 2–5 years typically | Usually 30–90 days |
| Price adjustment risk | None — price locked in; market may move against buyer | Market exposure during short completion period |
| GST | GST may apply on new construction (partial rebate) | Usually GST-exempt unless newly built/substantially renovated |
| Assignment | Possible if contract allows; developer often restricts | Title transfer on completion — no assignment concept |
| Inspection | Not possible pre-construction; completion walkthrough only | Pre-purchase inspection common and recommended |
REDMA: The Governing Framework
The Real Estate Development Marketing Act (REDMA) governs the marketing and sale of development properties in BC — primarily presale condos, townhomes, and strata lots. It applies to developers (the "developers") selling units before the strata plan is registered. Key REDMA obligations include:
Core REDMA Developer Obligations
| Obligation | Details | Consequence of Non-Compliance |
|---|---|---|
| File a disclosure statement with BCFSA | Before beginning marketing or sales | Developer cannot legally sell; buyers may rescind at any time |
| Deliver disclosure statement to buyer | Before or at the time of purchase contract | 7-day rescission period doesn't start until delivery |
| Hold deposits in trust | Designated trust account; cannot be released to developer until conditions met | Criminal liability; regulatory sanctions |
| File material amendments | Any material change to the development must be filed and disclosed to all buyers | Buyers get a new 7-day rescission period |
| File amendments to BCFSA | Developer files amended disclosure statement with BCFSA | Regulatory non-compliance; developer's marketing may be suspended |
| Register the strata plan | Buyer's obligation to complete only arises when strata plan is registered | Developer cannot force completion on an unregistered plan |
Who Does REDMA Apply To?
REDMA applies to developers — companies and individuals selling presale strata lots. It applies to sales to buyers, not to resales of presale contracts (assignments) between individuals — though assignments may still engage REDMA indirectly. REDMA applies to both residential condos and townhomes, and to mixed-use strata lots with residential components.
Importantly, realtors acting as listing agents for developers have their own obligations. They must ensure buyers receive the disclosure statement before entering a purchase contract, and must be aware of the rescission period mechanics. Acting negligently on behalf of a developer client does not shield a realtor from regulatory consequences.
The Disclosure Statement
The disclosure statement is the cornerstone of presale consumer protection under REDMA. It is a comprehensive document that must be provided to every buyer before they sign a purchase contract. A disclosure statement typically runs 50–200+ pages for a major condo development.
Key Contents of a REDMA Disclosure Statement
| Section | What It Contains | Why Clients Should Read It |
|---|---|---|
| Developer information | Developer identity, officers, related entities | Check developer track record, financial health |
| Project description | Building design, unit count, floor plans, specifications | Verify unit as described matches what buyer was shown |
| Estimated completion date | Target date for strata plan registration | Basis for completion; delays require amendment |
| Estimated strata fees | Monthly strata fees at time of filing | Actual fees at registration often higher — check cautiously |
| Amenities and common property | Gym, rooftop, concierge, parking — what's included | Common amenity representations can be amended |
| Parking and storage | Allocated or assigned; how many; designation | Strata lot #s for parking may differ from what was marketed |
| Encumbrances and liens on land | Mortgages on the development site | Developer financing: if developer defaults, buyers may be at risk |
| Purchase contract terms | Key contract provisions: deposit schedule, assignment restrictions, completion triggers | Critical — review with lawyer during 7-day period |
| Zoning and development approvals | Current zoning, required approvals still needed | If rezoning not obtained, project may not proceed as described |
| Warranty coverage | 2-5-10 New Home Warranty coverage details | All new BC homes must have 2-5-10 warranty |
⚠️ Estimated Strata Fees Are Usually Too Low
One of the most common presale buyer complaints: estimated strata fees in the disclosure statement are significantly lower than actual fees when the building opens. Disclosure statements typically show fees based on developer estimates, which tend to be optimistic. Buyers should research comparable strata buildings in the area to calibrate realistic fee expectations, rather than relying on the developer's estimates alone.
The 7-Day Rescission (Cooling-Off) Period
REDMA grants every presale buyer a 7-day rescission period — the right to cancel the purchase contract and receive a full refund of all deposits, without penalty, for any reason. This period begins the day after the buyer receives the disclosure statement.
7-Day Rescission: How It Works
| Step | What Happens | Key Note |
|---|---|---|
| Day 0 | Buyer receives disclosure statement from developer | Delivery method matters — electronic delivery with read receipt is common |
| Day 1 | 7-day rescission period begins | Day 1 is the day AFTER receipt, not the day of receipt |
| Day 1–7 | Buyer may cancel for any reason — no penalty, full deposit refund | Buyer sends written rescission notice to developer |
| Day 7 (end) | Rescission period expires if no notice sent | Contract becomes binding; buyer's deposits are no longer refundable under REDMA rescission right |
| After expiry | Contract is binding; completion occurs when strata plan registers | Buyer may still rescind for material amendments; subject conditions may still be pending |
What Buyers Should Do During the 7 Days
- 1.Have a real estate lawyer review the entire purchase contract and disclosure statement — this is the most important 7 days in the presale purchase process
- 2.Review the strata lot specifications carefully — size, floor plan, parking stall designation, locker
- 3.Research the developer: past projects, completion track record, any regulatory actions, financial stability
- 4.Get pre-approved for financing with a lender who can accommodate a 3–5 year future completion date
- 5.Review the assignment clause carefully — can you sell if your circumstances change?
- 6.Check the estimated strata fees against comparable buildings in the area
- 7.Understand the deposit schedule — how much is due now, and at what future milestones
🚨 Rescission Cannot Be Waived
Some developer sales representatives pressure buyers to sign a waiver or agree to not exercise their rescission right. This is not legally effective — the REDMA rescission right cannot be waived or contracted out of. Any clause in a purchase contract purporting to waive rescission rights is unenforceable. Document any such pressure from developer sales staff and advise your buyer client accordingly.
Material Amendments and New Rescission Rights
After signing, a buyer's rights don't end. If the developer makes a material change to the development, they must file an amended disclosure statement and notify all affected buyers. This triggers a new 7-day rescission period for affected buyers.
What Constitutes a Material Change Under REDMA
| Change Type | Material? | New Rescission Right? |
|---|---|---|
| Significant reduction in unit size (>5%) | ✓ Yes | ✓ New 7-day period |
| Significant price increase | ✓ Yes | ✓ New 7-day period |
| Material change to amenities (removing gym, pool, concierge) | ✓ Yes | ✓ New 7-day period |
| Change in developer/ownership structure | ✓ Yes | ✓ New 7-day period |
| Substantial delay in completion date (often 12+ months beyond estimate) | ✓ Yes in many cases | ✓ New 7-day period |
| Minor floor plan adjustment (same sq footage) | Likely not material | Likely no new period |
| Change in interior finish specifications (same quality) | Depends — if marketed specifically, may be material | Lawyer should assess |
| Change in parking stall assignment number | Depends on representation made during sale | Lawyer should assess |
Buyers who receive an amended disclosure statement should act quickly. If they do not rescind within 7 days of receiving the amendment notice, they are deemed to have accepted the change. Advise buyers to consult their lawyer immediately upon receiving any amendment notice.
Deposit Protection Under REDMA
Presale buyers typically pay deposits in stages over the construction period — often totalling 15–25% of the purchase price. REDMA requires these deposits to be held in a designated trust account maintained by the developer's lawyer or an accredited trust company.
Typical BC Presale Deposit Schedule
| Stage | Timing | Typical Amount | REDMA Trust Status |
|---|---|---|---|
| Initial deposit | At signing (after 7-day rescission) | 5% of purchase price | In trust until construction financing conditions met |
| Second deposit | 3–6 months after signing | 5% of purchase price | In trust |
| Third deposit | On foundation completion or slab pour | 5% of purchase price | In trust; developer may access after financing milestone |
| Final deposit / balance | On strata plan registration and completion | Balance of purchase price via mortgage payout | Paid on completion day |
Limits of REDMA Deposit Protection
REDMA deposit trust protections are meaningful but not unlimited. Buyers should be aware of the following limitations:
- •Deposits may be released to the developer upon reaching financing milestones — once released, they are no longer in trust
- •If a developer becomes insolvent after releases, buyers may become unsecured creditors competing with construction lenders
- •The trust account protects against developer malfeasance — not against legitimate construction cost overruns or market failure
- •Interest earned on deposits while in trust: some contracts allow the developer to keep interest; others credit it to the buyer on completion
- •Presale purchase insurance products (offered by some brokers) can provide additional protection beyond REDMA minimums
Assignment Clauses: Buying and Selling the Contract
A presale assignment is the sale of the purchase contract itself — the original buyer (assignor) transfers their contractual right to purchase the presale unit to a new buyer (assignee). The original contract with the developer remains intact; only the buyer changes.
Assignment: How It Works
| Party | Role | What They Pay/Receive |
|---|---|---|
| Assignor (original buyer) | Selling their right to buy the unit | Assignment fee from assignee + return of deposits paid |
| Assignee (new buyer) | Buying the right to purchase the unit | Pays original contract price on completion + assignment fee to assignor |
| Developer | Must consent if contract requires; collects consent fee | Consent fee (often 1–2% of purchase price or flat $5,000–$15,000) |
| CRA | Taxes the assignor on the assignment gain | Income tax on assignment profit (typically taxed as income, not capital gain) |
Assignment Contract Types
Common Assignment Permission Structures
| Contract Type | What It Means | Realtor Consideration |
|---|---|---|
| Free assignment allowed | Buyer can assign to anyone at any time without developer consent | Marketable as an assignment listing; realtor can advertise |
| Consent required (no fee) | Developer must approve assignee; no fee | Consent process adds time; developer can refuse unreasonably in some cases |
| Consent required + consent fee | Developer charges 1–2% or flat fee for consent | Consent fee must be factored into assignment pricing |
| No assignment permitted | Contract prohibits assignment entirely | Buyer is locked in; only exit is rescission (if within period) or breach |
| Spouse/immediate family only | Assignment permitted only within immediate family | Investor strategy severely limited; verify at purchase |
CRA and GST on Presale Assignments
The CRA has become increasingly aggressive about taxation of presale assignments. Key tax points to flag for clients:
- •Assignment gain (profit on the assignment) is typically taxed as business income (100% inclusion), not as a capital gain (50% inclusion)
- •GST may apply to the assignment fee — since 2022, presale assignment transactions are subject to GST on the assignment profit where the assignor is not an individual who originally purchased the unit for personal use
- •Assignors must file a T2062 if they are non-residents
- •Assignment transactions may trigger a T1 audit — maintain clear records of all costs
- •Always direct clients to a tax accountant before entering an assignment transaction
Presale Completion Risk Assessment
The most significant risk in a presale purchase is that circumstances may change dramatically between signing and completion — for the buyer, the developer, or the market. Realtors should walk buyers through a structured risk assessment before they commit.
Presale Completion Risk Categories
| Risk Category | What Can Go Wrong | Mitigation |
|---|---|---|
| Market risk | Property value at completion is lower than purchase price (negative equity) | Stress-test at lower values; consider resale market; avoid over-leveraging |
| Financing risk | Buyer cannot qualify for mortgage at completion (rates up, income changed, stress test changed) | Lender pre-approval at time of purchase; rate-hold products; conservative debt load |
| Developer risk | Developer goes insolvent; construction lender takes over or project cancelled | Research developer track record; review construction financing structure; understand deposit trust limits |
| Construction risk | Significant construction defects; delays exceeding tolerance | 2-5-10 warranty coverage; completion inspection by independent inspector |
| Personal risk | Buyer's circumstances change — divorce, job loss, relocation | Assignment rights in contract; ensure assignment is allowed if lifestyle flexibility is important |
| Strata fee risk | Actual fees far exceed disclosure estimates; special levies from day one | Compare to similar buildings; ask developer for assumptions behind estimates |
PTT, GST, and First-Time Buyer Programs on Presales
Tax Treatment of BC Presale Condo Purchases
| Tax / Program | Applies to Presale? | Key Rules |
|---|---|---|
| Property Transfer Tax (PTT) | Yes — on completion, on fair market value (purchase price for new construction) | Newly Built Home PTT Exemption available for homes ≤$1.1M (full) / up to $1.15M (partial) |
| GST | Yes — new construction is subject to 5% GST | New Home Rebate available: 36% of federal portion for homes priced ≤$350K; partial rebate to $450K. Homes over $450K: no federal rebate |
| BC New Housing Rebate (PST component) | Yes — for qualifying residential properties | Available for homes priced ≤$400K; partial rebate to $475K |
| FHSA (First Home Savings Account) | Yes — qualifying first-time buyers can use FHSA for presale completion | Must complete the purchase; withdrawal cannot be used just for deposits before strata plan registration |
| RRSP Home Buyers' Plan | Yes — with conditions | Buyer must intend to occupy before 1 year after completion; must not be a related party purchase |
| PTT First Home Buyer exemption | Yes — new construction qualifies | Different from Newly Built exemption; ≤$835K; buyer must be a first-time buyer + Canadian citizen/PR |
💡 GST Can Significantly Change Net Cost
A $650,000 presale condo attracts 5% GST = $32,500. After the GST rebate (if applicable at this price point — the rebate phases out), the net GST cost could be in the range of $10,000–$32,500. Many presale buyers (and some realtors) forget to include GST in their client's total cost of acquisition. Always confirm with the developer whether the listed price is GST-inclusive or exclusive, and model both scenarios for the client.
6 Client Conversation Scripts
Script 1 — Explaining the 7-day rescission period
The developer wants us to sign tonight at the sales event. Do we have to decide now?
Here's what you need to know: under BC law, no matter when you sign, you have a 7-day cooling-off period that starts the day after you receive the developer's disclosure statement. You can cancel for any reason during those 7 days and get all your deposits back — no questions asked. So signing tonight doesn't lock you in. What it does start is the 7-day clock. I'd strongly recommend using those 7 days to have a lawyer review the entire purchase contract and disclosure statement before you're committed.
Good to know. What should we be looking for?
The biggest things: the assignment clause (can you sell the contract if you need to?), the deposit schedule and how much you'd owe over time, estimated completion date, and the strata fee estimates — which are often too low. I'll walk you through it, but a real estate lawyer is the person to review the actual contract language.
Script 2 — Buyer concerned about developer insolvency
What happens to our deposit if the developer goes bankrupt?
Under BC's REDMA, your deposits must be held in a designated trust account — separate from the developer's operating funds. The money isn't the developer's to spend freely. If the developer fails to complete the project, you're entitled to your deposits back from the trust. That said, there are limits: once construction milestones are reached, some trust funds can be released to the developer, and if they've been spent, trust recovery can be complicated.
Should we be worried about this developer specifically?
I'd want to do some homework on their track record. How many projects have they completed? Any regulatory issues with BCFSA? Is this project fully financed or is financing conditional on sales targets? Your lawyer can look at the construction financing information in the disclosure statement. I can help you research their past projects as part of our due diligence.
Script 3 — Client wants to flip the presale via assignment
I want to buy this presale and assign it before completion to make a profit. Can you help me?
Absolutely — but let's make sure you're going in with eyes open. First thing to check: does this contract allow assignment? Some developers prohibit it entirely, or charge a consent fee of 1–2% of the purchase price. That's a significant cost that eats into your profit margin.
Let's say assignment is allowed. What about taxes?
CRA has been very active in this space. Assignment gains are generally taxed as business income — so 100% of the profit is included in your income, not the 50% capital gains inclusion rate. And if you're charging GST-applicable fees, there may be GST obligations too. You need to talk to an accountant before you commit to this strategy — the after-tax math can be very different from the headline numbers.
Script 4 — Developer sends a material amendment notice
We just got a notice from the developer that the completion date is being pushed back by 18 months and the gym is being removed. What do we do?
Those sound like material changes under REDMA. If the developer has filed an amended disclosure statement covering these changes, you should have a new 7-day rescission period — meaning you can cancel the contract and get all your deposits back right now. When did you receive the notice? We need to act fast if the 7-day period has already started.
Today. What should we do?
Call your real estate lawyer today — not tomorrow, today. The 7-day period may have started already. Your lawyer will review whether these changes trigger a rescission right and, if so, send the cancellation notice in the required form before the deadline. Don't wait.
Script 5 — Client asking about GST on presale
Does this $750,000 presale include GST or is that on top?
Great question — it varies by developer. You need to ask the developer's sales representative directly and get the answer in writing. If GST is on top of the $750,000, you're looking at an additional $37,500 — so the total cost of acquisition is actually $787,500, not $750,000. The GST rebate on homes at this price point is limited, so most of that $37,500 may not come back.
That's a big difference.
It is. The new home rebate phases out completely for homes over $450,000 in many cases, so for a $750,000 unit, you may owe the full 5%. Always model your total acquisition cost including GST, PTT, legal fees, and any consent fee for assignment before deciding if the numbers work for you.
Script 6 — First-time buyer wondering if presale qualifies for their programs
I'm a first-time buyer. Can I use my FHSA for a presale?
Yes — but timing matters. You can use your FHSA funds at completion, when the strata plan is registered and you're actually buying the unit. You can't use the FHSA to pay your presale deposits along the way — those come from your savings. At completion, your FHSA withdrawal flows through your lawyer's trust account just like any other purchase.
What about the PTT first-time buyer exemption?
That's available for newly built homes priced at $835,000 or below — and a presale condo qualifies as a newly built home. So if your unit comes in at or below $835K, you'd save the full PTT — which on a $750,000 unit would be around $13,000. That's a meaningful saving. Your lawyer handles the PTT exemption filing at completion.
Frequently Asked Questions
What is the 7-day cooling-off period for BC presale condos?
Under REDMA (Real Estate Development Marketing Act), a buyer of a presale condo has a 7-day rescission period (cooling-off period) after receiving the developer's disclosure statement. During this period, the buyer may rescind the purchase contract for any reason and receive a full refund of all deposits paid. The 7-day period begins the day after the buyer receives the disclosure statement. This is a statutory right that cannot be waived or contracted out of.
How are deposits protected in a BC presale condo purchase?
Under REDMA, deposits paid by buyers of presale developments must be held in a designated trust account (the developer's lawyer's trust account or a separate trust specifically for buyer deposits). Developers cannot access deposit funds until certain conditions are met — typically obtaining sufficient financing for the project. If a developer fails to complete the project, buyers are entitled to a refund of their deposits from the trust. However, trust protection does not protect against all developer insolvency scenarios, and buyers should be aware of the limits.
Can a presale condo buyer in BC assign their contract to another person?
It depends on the contract. Many BC presale purchase contracts include assignment restrictions — the developer may prohibit assignments entirely, require developer consent (often with a fee of 1-2% of the purchase price), or allow free assignment. Where assignment is allowed, the original buyer (assignor) transfers their contractual rights to a new buyer (assignee). The CRA has strict rules around presale assignment gains, which are taxable as income (not capital gains) in most cases. Realtors facilitating assignments must ensure proper disclosure and have written authorization from all parties.
What happens if a presale condo project is significantly delayed or the strata plan changes?
Under REDMA, if a developer makes a material change to the development (significant changes to size, price, amenities, or completion date), they must file an amended disclosure statement and re-notify all buyers. Buyers who receive an amended disclosure statement have a new 7-day rescission period, during which they may rescind and receive a full deposit refund. If a buyer does not rescind within the rescission period after receiving an amendment, they are deemed to have accepted the changes.
What are the risks for a buyer purchasing a presale condo that won't complete for 3-5 years?
Key risks include: (1) Market risk — the property may be worth less at completion than the purchase price; (2) Financing risk — mortgage rates or the buyer's qualifying rate may have changed; (3) Developer risk — the project may be cancelled or the developer may face financial difficulties; (4) Construction risk — the finished unit may not match expectations; (5) Strata fee risk — estimated fees in the disclosure may be substantially lower than actual fees on registration. Buyers should have their presale contract reviewed by a real estate lawyer before the rescission period expires.
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