New B.C. policies expand pre-sale home marketing period to 18 months
Amid challenging economic conditions and headwinds, real estate developers in British Columbia behind sizeable new strata multi-family ownership residential buildings could see more of their projects advance into construction.
On February 25, 2025, B.C. Financial Services Authority (BCFSA) launched a new pilot program that extends the “early marketing period” for developers with large projects of 100 or more homes by six months.
This effectively provides developers of such large projects with a total of 18 months to secure their approvals and financing needed to complete their projects — up from 12 months.
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Outside of the pilot project, under the Real Estate Development Marketing Act, this early marketing period for all pre-sale projects regardless of size was previously nine months up until April 2020, when BCFSA extended it by three months to 12 months, initially as a temporary response to the onset of the pandemic. In May 2021, the 12-month period was made permanent.
Developers perform early marketing activities over the 12-month period to secure pre-sale buyers for their yet-to-be-built units in a project. By extending it to 18 months, this provides developers with an extended timeline runway to reach the minimum threshold needed to secure final construction financing to begin work on their projects, based on set agreements with financial institutions and investors, as well as building permits.
“Rising construction costs and economic uncertainty have resulted in a challenging environment for developers of large projects,” said Jon Vandall, BCFSA’s Senior Vice President, Compliance and Enforcement, in a statement this week.
“This pilot program will provide developers with more time to secure financing and building permits for large, often complex, developments, so consumers can have confidence that their pre-sale units will be completed.”
This follows years of the escalating inflationary environment in costs for construction materials, labour, and equipment, along with high interest rates, resulting in high borrowing costs and weakened homebuying demand. Although interest rates are now on a falling trend, continued poor economic fundamentals could be further exacerbated by the impacts of U.S. President Donald Trump’s tariffs on Canadian goods.
Eligible developers participating in the pilot project will be required to submit quarterly reports on sales data and market trends to the regulatory authority, with the data used to evaluate the impact of the extended early marketing period — perhaps for a consideration to make this longer timeline permanent.
On the flip side, for homebuyers, BCFSA emphasizes that they should be aware that their deposit for a pre-sale home in a project under this pilot project may be tied up for up to 18 months — an additional six months — if the developer does not receive the necessary financing and building approvals.
Furthermore, starting April 1, 2025, real estate developers in B.C. must include a simple summary form at the front of disclosure statements for pre-sale properties. This form highlights key details about the project and buyer rights, making it easier for buyers to understand potential risks before signing a purchase agreement. Since these legal documents can be long and complicated, the goal is to help buyers make informed decisions and encourage them to seek professional advice if needed.