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BCFSA’s information is clear, concise, easy-to-read explanations of the requirements for real estate professionals under the Real Estate Services Act (“RESA”), Real Estate Services Regulation (“Regulation”), Real Estate Services Rules (“Rules”), and other applicable legislation.
This information is intended for use by real estate professionals, to support their understanding of the standards they must meet in the delivery of real estate services.
This legislation comes into effect on January 1, 2023 and provides buyers an opportunity to rescind a contract to purchase residential real property (see below) up to three business days after an offer is accepted. If a buyer chooses to rescind the contract in the time period provided, they must pay the seller 0.25% of the purchase price. This rescission period applies to transactions of residential real property regardless of whether a real estate licensee is involved in the transaction and cannot be waived by the buyer or seller.
The types of residential real property that are subject to the rescission period are as follows:
- A detached house;
- A semi-detached house;
- A townhouse;
- An apartment in a duplex or other multi-unit dwelling;
- A residential strata lot, as defined in Section 1 (1) of the Strata Property Act;
- A manufactured home that is affixed to land; and
- A cooperative interest, as defined in Section 1 of the Real Estate Development Marketing Act, that includes the right of use or occupation of a dwelling.
The following types of properties are excluded from the rescission provisions
- Residential real property that is located on leased land;
- A leasehold interest in residential real property;
- Residential real property that is sold at auction; and
- Residential real property that is sold under a court order or the supervision of a court.
The rescission right also does not apply to any purchase and sale of property under the Real Estate Development and Marketing Act where Section 21 of that Act applies.Learn more about presales
You are required to make two disclosures regarding the HBRP Regulation. The first disclosure is made via the Disclosure of Representation in Trading Services Form which includes a general reference to alert all consumers to the HBRP. A second disclosure at the time of preparing or presenting an offer must also be made to your client. The disclosure is required to be on a form approved by the superintendent and must include the following:
- The fact that the right of rescission cannot be waived;
- The period during which the buyer may exercise their rescission rights;
- The calculation of the dollar amount that the buyer must pay to the seller and when and how that amount must be paid;
- The requirement to return to the buyer the remainder of the deposit (if one is being held) after the prescribed amount is paid to the seller from the deposit; and
- The exemptions to the right of rescission.
You are reminded that all disclosures made must be provided to and retained by your brokerage.Learn more about disclosures
The HBRP Regulation does not create an obligation for a deposit, however, if the brokerage is holding a deposit and the buyer chooses to rescind the contract, the brokerage must pay the rescission fee to the seller and release the remainder to the buyer despite any contractual conditions to the contrary. A separate written agreement to release these funds is not required under these circumstances.Learn more about deposits
If a buyer chooses to rescind the contract, they must serve written notice to the seller within the rescission period. A notice of rescission is deemed to be served on a seller if the notice is sent:
- By registered mail to the seller’s address that is set out in the contract of purchase and sale;
- By fax to the seller’s fax number that is set out in the contract; or
- By email, with a requested read receipt, to the seller’s email address that is set out in the contract.
The rescission notice must include the following:
- The address, the parcel identifier (PID) or a description of the property;
- The name, and the signature, or electronic signature, of the purchaser (or buyer) who is exercising the right of rescission;
- The name of each seller who is a party to the contract; and
- The date that the right of rescission is being exercised.
The form of notice to rescind is not on a mandatory form however BCFSA has created a form to assist you.
Brokerages are required to retain notices of rescission that are prepared by or on behalf of a brokerage and served on a seller, or that are received by the brokerage.
Brokerages are required to report information about any rescissions exercised in their brokerage activity report. Information required includes:
- Property type;
- Property address, parcel ID, or other legal description;
- Listing date;
- Listing price;
- Accepted offer price;
- Date of offer acceptance;
- Date of rescission notice;
- Amount of rescission fee;
- Whether there was a deposit;
- Value of deposit (if applicable); and
- Whether deposit held in brokerage trust account.