On Feb. 25, CAN BC FSA launched pilot for real estate developers.
CAN BC FSA launched pilot program for large real estate developments, introduced new consumer disclosure requirement on pre-sale rights, issued new consumer guide.
Follows CAN BC FSA public consultation on real estate consumer disclosure, #209063.
Background
Under the Real estate development marketing act (REDMA), developers can typically undertake early marketing activities over a 12-month period to secure pre-sale buyers.
Helps real estate developers secure financing and building permits for their projects.
Due to their complexity and size, large development projects face challenges securing the necessary approvals and financing within the existing 12-month marketing period.
Pilot Program
Allow eligible developers with projects of 100 or more development units additional six months of early marketing; total of 18 months to secure approvals, financing required.
To participate in pilot, developers required to submit quarterly reports on sales on data and market trends to BCFSA; data used to evaluate impact of early marketing period.
Buyers should be aware if they put a deposit on a pre-sale unit in a project that does not receive necessary financing, building approvals, their deposit may be tied up.
Additional 6 months, may be at risk of re-entering market under different conditions.
Buyers can confirm whether a development is participating in pilot program, and has an 18-month early marketing period, by referring to their disclosure statement.
Development in program, disclosure will indicate 18-month early marketing period.
New Consumer Disclosure
Also implementing new requirement, summary of pre-sale risks and buyer rights.
Real estate developers must attach completed form to front of disclosure statements.
Highlight important information from disclosure statement, purchase agreement about development, must be provided to buyer when they enter into pre-sale agreement.
Encourages buyers to seek professional advice and read entire disclosure statement.
Also released a new Consumer guide to pre-sale real estate purchases to help consumers understand risks involved with purchasing a pre-sale development unit.
The guide aims to empower consumers with essential knowledge about pre-sale risks.
Consultation
Developers able to submit data on CAN BC FSA’s IRIS platform starting Summer 2025.
Information and resources on how to submit data will be provided in Spring 2025.
Summary of pre-sale risks and buyer rights form will come into effect Apr. 1, 2025.
