Why Real Estate Deals Go Wrong in Vancouver
Buying or selling a home in BC—especially in Vancouver—can be complicated. Even with an agent, legal disputes are common. Here’s what every buyer and seller should know to avoid costly mistakes and protect your rights.
The Basics: What’s Required to Buy Property in BC?
- You must use a licensed real estate agent to purchase property.
- Your agent prepares the contract of purchase and sale.
What’s in the Real Estate Contract?
- Purchase price
- Deposit amount
- Closing date (when ownership transfers)
- Conditions (like financing or inspection)
- Condition removal deadline (when you confirm conditions are satisfied)
The Power of “Subject Conditions”
After signing, the contract is legally binding—unless it’s “subject to” certain conditions (like mortgage approval or inspection).
- If the buyer’s conditions aren’t satisfied and removed on time, the contract is void and the deposit is refunded.
- If conditions are waived, the contract is final. If either side backs out, there are legal consequences.
The Importance of the Property Disclosure Statement (PDS)
This document requires the seller to disclose all known problems with the property, such as:
- Underground oil tanks
- Past grow-ops (marijuana)
- Deaths in the home
- Water leaks or flooding
- Illegal suites or unpermitted renovations
What if the seller hides something?
If a buyer later discovers an undisclosed defect, the seller can be sued for damages.
Real case: A seller failed to disclose chronic basement leaks; the buyer sued after moving in and won in court.
How Buyers Can Protect Themselves
- Hire a qualified home inspector after signing the contract, but before removing conditions.
- If defects are found, ask the seller to fix them or negotiate a price reduction.
- Always keep copies of all contracts and closing documents for future disputes or tax questions.
What If There’s a Breach of Contract?
If the Seller Breaches (Refuses to Sell)
Often happens in rising markets when the seller wants a higher price.
Buyer’s remedies:
- Refund of the deposit
- Court order for “specific performance” (forcing the sale)
- Claim for damages (the extra cost of buying a similar property at a higher price)
How are damages calculated?
- The buyer must show they bought a comparable home for more money.
- The difference is the amount owed by the breaching seller.
- If the market went down, the buyer’s claim for damages may be limited.
If the Buyer Breaches (Refuses to Buy)
Common in falling markets when buyers try to escape the contract.
Seller’s remedies:
- Keep the buyer’s deposit
- Sue for further damages (if the property later sells for less than the original price)
If the market went up:
- The seller keeps the deposit but usually can’t claim more damages.
Special Case: Presale (“Assignment of Contract”) Risks
Presale condos (“楼花”) are common in Vancouver. Many buyers face issues at closing, especially if:
- Interest rates have risen
- Financing is suddenly unavailable
- The buyer wants to “assign” (sell) the presale to someone else
Key points:
- Assignments often need the developer’s approval—sometimes only to family members.
- If the developer refuses, and you can’t close, you’re in breach.
Breach consequences:
- If prices rise: Developer keeps all deposits.
- If prices fall: Developer keeps deposits and may sue for the difference between your price and the lower resale price.
Key Advice for Buyers and Sellers
For Sellers:
- Disclose all defects honestly
- Keep records of repairs
- Consult a lawyer for complex deals
- Understand the legal risks of breaching the contract
For Buyers:
- Read all contract terms carefully
- Hire a professional inspector
- Get mortgage pre-approval before waiving financing conditions
- Keep all documents and receipts
For Presale Buyers:
- Understand assignment restrictions
- Make sure you can finance the closing
- Monitor market trends
- Be prepared for the risk of breach
Common Real Estate Disputes and How to Prevent Them
Most common issues:
- Hidden defects
- Breach of contract
- Disputes over deposit refunds
- Delays in closing
- Assignment issues with presale condos
Prevention:
- Clear, detailed contracts
- Professional legal advice
- Full due diligence
- Proper insurance
- Timely, honest communication
When to Hire a Real Estate Lawyer
- The contract has unusual terms or conditions
- A defect or problem is discovered
- The deal is at risk of collapse or there’s a breach
- You need to enforce or defend your rights in court
Real Estate Agents, Lawyers, and Inspectors—Who Does What?
- Real estate agent: Finds property, negotiates price, drafts contracts
- Real estate lawyer: Reviews contracts, protects your interests, handles disputes and litigation
- Home inspector: Checks property for hidden defects, provides a report
How Market Trends Affect Risks
- Rising market: Sellers have more power, buyers compete, breach risk lower
- Falling market: Buyers have more power, breach risk higher, more legal disputes
- Rising rates: Harder to get loans, more closing failures, more presale problems
Summary
BC real estate deals are complex, with many legal risks. Whether you’re buying or selling:
- Know your legal rights and duties
- Disclose all information honestly
- Get professional help for complicated deals
- Be ready for breach risks
- Keep all paperwork
Real estate is a big investment—protect yourself with the right professional advice.
Contact George Lee Law for Real Estate Legal Advice
We help buyers and sellers with contracts, disputes, disclosure issues, and presale risks—protecting your biggest investment.
Languages: English, Mandarin Chinese, Cantonese
Phone: 604-681-1611
Email: info@gleelaw.com
Website: gleelaw.com
This article is for general information. For legal advice about your property deal, consult a qualified BC real estate lawyer.
