Buying a Presale Condo in BC: Deposits, Disclosure and Your Right to Cancel

Buying a presale condo or townhome can mean a brand-new home, time to save and a price agreed today for a home you move into later. It also works very differently from buying a resale home, with its own paperwork, deposit rules and right to cancel. Here is what I would want you to know before you sign.

The short version

How a presale works

With a presale, you sign a purchase agreement for a home that has not been built yet, or is still under construction. You pay deposits on the schedule set out in your contract, and the rest of the price is due on completion, when the building is finished and the home is transferred into your name. That can be months or years after you sign, so your plans, your finances and the market can all change in the meantime.

Deposit amounts and schedules are set by each developer's contract. BC's Real Estate Development Marketing Act does not set a minimum or a maximum.

The disclosure statement

Before you sign, the developer must give you a disclosure statement and get your written acknowledgment that you received it. It is the developer's formal disclosure about the project, and it deserves a careful read. Since April 1, 2025, new disclosure statements also start with a Summary of Pre-sale Risks and Buyer Rights from the BC Financial Services Authority (BCFSA). Look closely at the estimated completion dates, the proposed strata budget and bylaws, and the terms of your purchase agreement, including the rules on assignments.

Your 7-day right to cancel

You can cancel (rescind) the purchase agreement by written notice within 7 days after the later of the day you signed it or the day you acknowledged receiving the disclosure statement. The notice must be signed and delivered in person or by registered mail to the developer or its brokerage, at the address in the disclosure statement or your agreement.

A few points catch buyers out:

• Amendments do not restart the clock. If the developer later amends the disclosure statement, you do not get a fresh 7 days.
• The resale rule does not apply. The 3-business-day home buyer rescission period that covers most resale purchases does not apply to presales covered by the Act.
• Use the week well. Read the disclosure statement and your contract, check your financing, and get legal advice if anything is unclear.

Where your deposit goes

Presale deposits must be held in trust by a brokerage, a lawyer or a notary public, and most are held by the developer's lawyer or notary. A developer can only use deposits for purposes such as construction if it has a deposit protection contract with an insurer and has given you notice.

Assignments: selling before completion

Selling your contract to someone else before completion is called an assignment. Since 2019, BC presale contracts must say they cannot be assigned without the developer's consent, and the developer must collect identifying and tax information from both you and the new buyer, along with the prices and any fee, and report it to the Province. That information is shared with the Canada Revenue Agency.

Profits are taxed too. BC's home flipping tax applies to profit on presale contracts held for less than 730 days, at up to 20%, and the federal property flipping rule can treat profit on a contract held for less than 365 days as fully taxable business income. If there is any chance you will need to sell before completion, get tax advice before you sign.

Costs at completion

• Your mortgage. Your financing is finalized close to completion, and a pre-approval at signing is not a guarantee, so keep your finances steady while you wait.
• Property transfer tax. It is due when the transfer is registered, based on the total amount you paid. BC's Newly Built Home Exemption removes it entirely on homes with a fair market value up to $1,100,000, with a partial exemption up to $1,150,000, if you are a Canadian citizen or permanent resident and the home will be your principal residence.
• GST. New homes are subject to GST. First-time buyers may qualify for a rebate of the full GST on homes up to $1 million, with a partial rebate up to $1.5 million.
• Adjustments and legal fees. Your lawyer or notary sets out your share of property taxes and strata fees on the statement of adjustments, and you pay their fees at completion.

I explain the property transfer tax exemptions and the GST rebate in more detail in First-Time Home Buyer Programs in BC.

The pre-delivery inspection

Before you take possession, you will usually walk through the home with the builder for a pre-delivery inspection, or PDI. Take your time and record every scratch, chip and unfinished detail on the PDI form. BC Housing notes that warranty providers generally rely on what was recorded at the PDI when deciding claims about damaged finishes. If you find defects later, report them in writing to both the warranty provider and the builder before your coverage expires.

New homes in BC come with home warranty coverage, often called 2-5-10 coverage: 2 years on materials and labour (12 months for most defects, and 24 months for items such as plumbing, electrical and heating systems), 5 years on the building envelope and 10 years on the structure.

Questions buyers often ask me

Can I cancel a presale contract in BC?

Yes, within 7 days after the later of signing the agreement or acknowledging receipt of the disclosure statement. The notice must be in writing, signed, and delivered in person or by registered mail to the developer or its brokerage. The 3-business-day rescission period for resale homes does not apply to presales.

Who holds my presale deposit?

It must be held in trust by a brokerage, lawyer or notary public, most often the developer's lawyer or notary. The developer can only use it for construction under a deposit protection contract with an insurer, after giving you notice.

Can I sell my presale before it is finished?

Only with the developer's consent, through an assignment. The developer reports the details to the Province, and any profit may be subject to BC's home flipping tax and federal tax rules.

Do I pay property transfer tax on a presale?

Yes, when the transfer is registered at completion, unless you qualify for an exemption. If you are a Canadian citizen or permanent resident, the Newly Built Home Exemption removes the tax on homes with a fair market value up to $1,100,000 that will be your principal residence, with a partial exemption up to $1,150,000.

What is a pre-delivery inspection?

It is a walk-through of your new home with the builder before you move in, to record any deficiencies. Be thorough, because warranty providers generally rely on what was recorded at the PDI when assessing claims about damaged finishes.

Planning to finance a presale? Start with a mortgage pre-approval, and compare the process with a resale purchase in From Offer to Keys.

This article is general information, not legal or tax advice. For more on presale rules and buyer protections, see BCFSA's presale guidelines.