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The Real Estate Development Marketing Act (the “Act”). The Act and the Real Estate Development Marketing Regulation (the “Regulation”) are available at Laws Publications — Government. The Superintendent of Real Estate’s 15 Policy Statements, which explain the Act, are available on the Requirements for Marketing Real Estate Developments page.
The Act applies to “development property”, which is defined as: 5 or more subdivision lots (unless each lot is 64.7 hectares or larger); 5 or more bare land strata lots; 5 or more strata lots in a stratified building; 2 or more cooperative interests; 5 or more time share interests; 2 or more shared interests in land; or 5 or more residential leasehold units. Each type of development property is defined in section 1 of the Act.
The Act applies to selling, leasing, offering for sale or lease, and any activity that is likely to lead to a sale or lease. See the definition of “market” in section 1 of the Act.
Before a developer can market a development unit, it must: meet preliminary approval requirements (see sections 4 to 10 of the Act); adequately assure title, utilities and services (see sections 11 to 13 of the Act); and file a Disclosure Statement with our office (see sections 14 to 17 of the Act, and the Superintendent of Real Estate’s Policy Statements).
The following Policy Statements explain the Disclosure Statement requirements for each type of development property:
Policy Statement 1 “Five or More Strata Lots”;
Policy Statement 2 “Five or More Bare Land Strata Lots”;
Policy Statement 3 “Five or More Subdivision Lots”;
Policy Statement 8 “Five or More Time Share Interests”;
Policy Statement 9 “Five or More Leasehold Units”;
Policy Statement 10 “Two or More Cooperative Interests”;
Policy Statement 11 “Two or More Shared Interests in Land”;
Policy Statement 13 “Real Estate Securities”;
Policy Statement 14 “Development Property that is not yet Completed”; and
Policy Statement 15 “Developer’s Background and Conflicts of Interest”.
See also Policy Statement 7 “Signing Disclosure Statements”.
See Policy Statement 12 “Form and Content — Transitional”.
A developer must file an Amendment to its Disclosure Statement if it becomes aware that the Disclosure Statement does not comply with the Act or Regulation, or contains a misrepresentation. See section 16 of the Act. For example, an amendment would be required if a developer realizes that a material fact has been omitted, changed, or misrepresented.
A new Disclosure Statement must be filed if the developer’s identity changes, or if a receiver, bankruptcy trustee or similar person is appointed for the developer. See section 16 of the Act.
The fee for filing a Disclosure Statement is based on the total number of development units in the development property. The Disclosure Statement fee is: $900 for up to 9 units; $1,800 for 10 to 49 units; $3,600 for 50 to 99 units; and $5,400 for 100 or more units. The fee for filing an Amendment to a Disclosure Statement is $600 regardless of the number of development units. Cheques should be made payable to BC Financial Services Authority. See section 13 of the Regulation.
A developer must give a purchaser a copy of the filed Disclosure Statement, and a copy of any filed Amendment to the Disclosure Statement, before entering into an agreement for sale or lease with that purchaser. See section 15 of the Act.
Yes. A developer who receives a deposit from a purchaser or a lessee must place the deposit with a real estate brokerage, lawyer, or notary public, who must hold the deposit in a trust account in British Columbia. See section 18 of the Act. If authorized deposit insurance has been obtained, the trustee may release a deposit to the developer. See section 19 of the Act.
Yes. Sections 2 to 8 of the Regulation set out specific exemptions from Part 2 of the Act. Additionally, in an appropriate situation, the Superintendent may grant further exemptions. See section 20 of the Act.
Section 2 in each of Policy Statements 1 to 3 and 8 to 11 explains our view of the pre-marketing activities that are allowed before a developer files a required Disclosure Statement.
A developer can begin marketing as soon as its Disclosure Statement has been filed (e.g., delivered to our office by courier or in the mail). Thus, a developer may begin marketing even before the Disclosure Statement has been reviewed by our office.
If a Disclosure Statement is found to be deficient, and the developer has already begun marketing, an Amendment must be filed to correct the Disclosure Statement. Alternatively, if no marketing has occurred, a developer may correct a Disclosure Statement by submitting replacement pages for that document. There is no fee for submitting replacement pages.
A developer can use either a licensed real estate professional, or a person who is exempt from the licensing requirement, to market its development units. The licensing requirement and licensing exemptions are set out in the Real Estate Services Act and the Real Estate Services Regulation, which are available at Laws Publications — Government. Further information about licensing see the Becoming Licensed page.
The Homeowner Protection Act generally requires a developer of new homes to offer a construction warranty. The warranty must be provided by an authorized insurance company. The developer’s Disclosure Statement must briefly explain the warranty. Further information about the Homeowner Protection Act and warranty coverage is available from BC Housing.
A developer must give each purchaser a copy of the filed Disclosure Statement, and a copy of any
filed Amendment to the Disclosure Statement, before entering into an agreement for sale or lease with that purchaser. See section 15 of the Act. The required form and contents for a Disclosure Statement are explained in our Policy Statements 1 to 3 and 8 to 11, 14 and 15.
Yes, but only during the seven-day rescission period. Thus, a purchaser or lessee may rescind a purchase agreement by serving written notice of that rescission on the developer within seven days after the later of: the date that the purchase agreement was made; and the date that the developer obtained a receipt from the purchaser for the Disclosure Statement. See section 21 of the Act.
See Section 11 of the Regulation, which explains how a purchaser or lessee may serve written notice of rescission on a developer.
Yes. Our fee is $38 for each file retrieved plus 50 cents for each copied page. See Section 14 of the Regulation.
Yes. A developer is required to file an Amendment to its Disclosure Statement if a material fact has been omitted, changed, or misrepresented. Each purchaser who has not completed his or her purchase must be given a copy of the Amendment. See section 16 of the Act.
A purchaser’s rights are governed by contract law and the purchase agreement. Under contract law, a purchaser may ask a court to order compensation, or may ask a court to rescind the purchase agreement, as a remedy for any breach of contract.
Additionally, under the Act a purchaser is deemed to have relied on the Disclosure Statement, whether or not he or she received it. A purchaser may ask a court to order compensation from a developer and its directors for any false or misleading statement of a material fact, or any omission of a material fact. See section 22 of the Act.
A purchase agreement may not be enforceable against a purchaser by a developer who has breached any provision in sections 3 to 20 of the Act. See section 23 of the Act.
No. A purchaser would have to ask a court to determine what rights he or she has, and ask for a court order to enforce those rights.
A purchaser can provide our office with any evidence that suggests a developer’s Disclosure Statement is deficient. We will evaluate that evidence and, if necessary, investigate further. Our office can ask a developer to file an Amendment to a deficient Disclosure Statement. We can also ask or order a developer to cease marketing if its Disclosure Statement is deficient.
A complaint about a real estate professional, including unlicensed individuals, should be directed to the Report a Concern page.
Deposits must be held in trust in British Columbia by a real estate brokerage, lawyer, or notary public, and so generally cannot be used to construct and market the development units. See section 18 of the Act. However, if authorized deposit insurance has been obtained, the trustee may release a deposit to the developer for the developer’s own purposes. See section 19 of the Act.
For further information, a developer or purchaser may be referred to:
- A lawyer. If the caller does not have a lawyer, a Lawyer Referral Service is offered by the British Columbia Branch of the Canadian Bar Association by Phone at (604) 687-3404 in the Lower Mainland, or toll free in B.C. at (888) 687-3404; and
- BCFSA’s Real Estate Department Department at [email protected].
BCFSA periodically issue Frequently Asked Questions (FAQs) to provide technical interpretations and positions regarding certain provisions contained in the Real Estate Development Marketing Act and Regulations. While the comments in particular FAQs may relate to provisions of the law in force at the time they were made, these comments are not a substitute for the law. The reader should consider the comments in light of the relevant provisions of the law in force at the time, taking into account the effect of any relevant amendments to those provisions or relevant court decisions occurring after the date on which the comments were made. Subject to the above, an interpretation or position contained in FAQs generally applies as of the date on which it was published, unless otherwise specified.