What Is a Disclosure Statement for New Developments in BC?

You have been handed a thick document by a presale sales team, and it is called a disclosure statement. It is easy to treat it as paperwork, but it is the main written record of what the developer says about the building, the unit and the deal.

This article explains what the statement is, what it must contain, what to look for, and what happens when the developer amends it. It is general information for British Columbia, and a lawyer can review your specific documents.

This article covers the law of British Columbia.

What a disclosure statement is and when it applies

The Real Estate Development Marketing Act (REDMA) applies to a developer who markets a development unit in British Columbia. A developer must not market a development unit unless it has prepared and filed a disclosure statement.

Development property generally means land with 5 or more subdivision, bare land strata, strata, time share or leasehold units, or 2 or more cooperative interests or shared interests in land. Some situations are exempt. The superintendent may exempt a person, land or transaction from all or part of Part 2 of REDMA, and the Regulation exempts classes such as developer-to-developer sales, leases of three years or less, and low-cost cooperative interests of $5,000 or less.

What the statement must say

The statement must plainly disclose all material facts and must not contain a misrepresentation. A material fact includes a fact that affects, or could reasonably be expected to affect, the value, price or use of a development unit.

The Regulation adds specific requirements. If the developer enters a deposit protection contract, the statement must give the insurer's name and business address, the developer and the date the insurance takes effect. The statement must be signed by the developer, and for corporate developers the directors must also sign, unless the superintendent grants an exemption.

Since April 1, 2025, a Summary of Pre-sale Risks and Buyer Rights form must be attached to the front of a pre-sale disclosure statement filed under REDMA Policy Statement 14. It is not required for statements filed earlier or for later amendments of them.

What to look for when you read it

• Whether a deposit protection contract is in place and, if so, the insurer's name and business address, the developer and the date the insurance takes effect.
• Whether the statement is signed by the developer and, for a corporation, the directors.
• Anything that could affect the price, value or use of your unit, such as fees, restrictions or planned changes to the project.
• Whether the purchase agreement lets the developer change size, price or completion date. That is decided by the agreement and the statement, so read both together.
• Assignment terms, if you may want to sell the contract before completion.
• Warranty details for the new home.

Filing with the BC Financial Services Authority (BCFSA) is not an endorsement. The superintendent has no duty to assess the merits of a disclosure statement or check it for misrepresentations. Reading it carefully, and having a lawyer review it, can help you protect yourself.

How the process works and what amendments do

Before a purchase agreement is signed, the developer must give you the disclosure statement, allow a reasonable opportunity to read it, and obtain your written acknowledgment of receipt.

If a developer learns that a statement is non-compliant or contains a misrepresentation, it must promptly file a new statement or an amendment and give copies to affected purchasers. Having already received a disclosure statement, you do not get a rescission right from an amendment alone. However, if you did not receive a required amendment that concerned a material fact reasonably relevant to your decision, you may rescind if no more than one year has passed after transfer of title.

Cancelling or claiming if something is wrong

To rescind, you serve written notice by delivering a signed copy in person or by registered mail to the developer or its brokerage at the address in the disclosure statement or purchase agreement. The developer must then immediately inform the deposit holder, who must promptly return your deposit. If you rescind after title has transferred, the developer may apply to court for an order that you pay market rent for occupying the unit.

You are deemed to have relied on a misrepresentation in the statement and may sue the developer, its directors and other listed persons for damages. The action may not start more than 2 years after the misrepresentation first came to your knowledge. It is a defence if the defendant proves you knew of the misrepresentation when you received the statement.

A developer who has breached Part 2 of REDMA cannot enforce the purchase agreement against you. There are exceptions. The agreement stays enforceable if the breach involved no misrepresentation of a material fact reasonably relevant to you. It also stays enforceable if the developer did not know of the misrepresentation and corrected it by an amendment filed within 30 days of becoming aware and no later than 14 days before the date title is to transfer, and the amendment was provided to you.

What to do next

• Ask for the full statement and every amendment, and keep dated copies.
• Do not sign the acknowledgment of receipt until you have had a reasonable chance to read the statement.
• Have a lawyer review the statement and purchase agreement before you sign.
• Diarize the 7-day rescission window if you sign.
• Keep any notice you send, and use delivery in person or registered mail.
• If you think the statement is inadequate, BCFSA investigates complaints about developers, but it does not enforce your contract rights.

Frequently asked questions