Common Subject Conditions You Can Put in an Offer in BC

When you write an offer on a home, you can make it conditional on things you need to check. Those conditions are the subjects. They protect you, but each one also gives the seller a reason to hesitate, so the list and the timing matter.

This article covers the conditions buyers commonly use in British Columbia and how to think about how long to allow. Dates and wording should be settled with your licensee or lawyer, because they depend on your situation.

This article covers the law of British Columbia.

Financing

A financing subject makes the deal depend on you obtaining a mortgage on acceptable terms. Lenders usually want to review the property and your finances, so give them realistic time. If you already have a pre-approval, confirm with the lender what is still outstanding.

Factor your closing costs into the amount you arrange. Property transfer tax is charged at 1% on the portion up to $200,000, 2% on the portion above $200,000 up to $2,000,000, and 3% on the portion above $2,000,000. A further 2% applies to the residential value above $3,000,000.

The buyer pays the tax and files a return when applying to register at the land title office. In practice the return is usually filed by a lawyer or notary, and the tax is normally paid through the conveyancer on completion. Exemptions may reduce the amount. For properties registered on or after April 1, 2024, the first-time home buyers' program gives a full exemption if fair market value is $835,000 or less, and a partial exemption if it is above $835,000 and below $860,000. The buyer must be a Canadian citizen or permanent resident, must have lived in BC for at least a year immediately before registration or filed at least 2 income tax returns as a BC resident in the last 6 taxation years, must never have owned a principal residence anywhere in the world, and must use the home as their principal residence. If only some co-buyers qualify, only their ownership share is exempt. Whether you qualify depends on your situation, so confirm it with your lawyer or notary.

Inspection and title

A home inspection subject lets you have the property examined and decide whether to go ahead. Book the inspector as soon as the offer is accepted, since schedules can be tight.

A title review subject lets your lawyer or notary check the title for charges or issues. Notaries who are enrolled and in good standing may draw instruments relating to property that are meant to be registered. A buyer acting on their own behalf is allowed, although the registered documents are normally prepared and filed by a lawyer or notary.

Put your subjects in writing and keep signed copies. A contract respecting land is generally not enforceable unless there is a signed writing showing the contract was made and giving a reasonable indication of its subject matter, with limited alternatives such as part performance or reasonable reliance. This rule does not apply to a lease of land for a term of 3 years or less.

Strata documents

If you are buying a strata lot, a review of strata documents is commonly made a subject condition. The strata corporation must give an Information Certificate in the prescribed form within one week of a request by an owner, a purchaser, or a person they authorize. Buyers use it to review the strata's finances and rules.

Since one week is the outer limit for the strata to respond, set your subject date with room to read the documents and ask questions afterwards.

Choosing timing and the rest of the list

There is no single correct number of days. How long to allow depends on how fast your lender, inspector and strata can act, and on how competitive the market is. A very short period may leave you unable to finish your checks, and a long one may make your offer less attractive.

• Other conditions are possible, such as the sale of your current home or review of a property disclosure, but each needs careful wording.
• For a new development presale, developers must hold buyers' deposits in trust under the Real Estate Development Marketing Act.
• Some offers provide for no deposit until after subjects are removed, and a seller can counter-offer to increase the deposit or require it before subject removal.

A buyer usually makes a deposit with the offer or after the offer is accepted, and it is usually held in the licensee's brokerage trust account, with the brokerage holding it as stakeholder. Licensees must pay money they receive into a trust account. Ask how and when your deposit is due before you sign.

What to do next

• List the things you must confirm before you would be comfortable being bound.
• Ask your lender, inspector and, if relevant, the strata how long they need.
• Choose subject dates that leave a margin for delays.
• Have the wording of each subject reviewed before you sign the offer.
• Keep copies of all signed documents.

A lawyer can review your offer before it is submitted and explain how each subject would work.

Frequently asked questions