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On January 3, 2023, the B.C. government implemented the Home Buyer Rescission Period (“HBRP”) for residential real estate transactions. Also known as the “cooling-off period,” this measure will give homebuyers up to three business days to rescind an offer on a home after the offer has been accepted.
Not all properties are included in the HBRP legislation. The rescission period applies to the following types of residential properties:
- 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 a right of use or occupation of a dwelling.
The following property types are excluded from the HBRP:
- Residential property that is located on leased land;
- A leasehold interest in residential property;
- Residential property that is sold at auction; and
- Residential property that is sold under a court order or the supervision of a court.
A buyer has the right to rescind a home offer within three business days after the offer is accepted, regardless of whether a real estate licensee is involved in the transaction. The three-day rescission period excludes weekends and holidays.
Only buyers can rescind a contract under the HBRP. If a buyer chooses to rescind their offer, they must:
- Notify the seller in writing before the rescission period expires; and
- Pay the seller a rescission fee. The rescission fee is 0.25% of the offer price.
The right to rescission cannot be waived by the buyer or the seller. The seller will receive a disclosure of the buyer’s right of rescission when an offer is made. The disclosure may be on a separate form, or included in the Contract of Purchase and Sale.
If a buyer chooses to rescind their offer and their brokerage is not holding the deposit, the seller is advised to seek legal advice for options on how to pursue the buyer for money owed.
Buyers do not need to provide a reason to sellers if they choose to rescind the contract.
Real estate licensees must provide general HBRP information to all consumers, including unrepresented parties.
Licensees do this by using the Disclosure of Representation in Trading Services (“DORTS”) form.learn more about dealing with unrepresented parties
Licensees are obligated to disclose to their clients the buyers right of rescission. This disclosure is required when licensees prepare an offer to purchase on behalf of their buyer clients, or when licensees present an offer to purchase to their seller clients. This disclosure can be made either using BCREA’s standard Contract of Purchase and Sale (CPS), or the BCFSA form Disclosure of Buyers’ Right of Rescission. Both forms are approved by the Superintendent of Real Estate.
Read BCFSA’s Home Buyer Rescission Period Guideline for more information on how to disclose required HBRP information to clients.