Can a BC Developer Sue You for Walking Away From a Presale?

Can a developer sue you for not completing a presale in BC?

Yes. If you sign a presale contract in BC and can’t close, the developer can keep your deposit, resell the unit, and then sue you for the shortfall plus their costs. In 2026, developers in Surrey, Langley, and Port Moody are doing exactly that, with claims running from $70,000 to $166,000 on top of forfeited deposits. The best protection is to plan for a low appraisal before you sign, use your 7-day rescission window wisely, and read every disclosure statement amendment.

Imagine handing a developer $68,000 for a home that doesn’t exist yet.

You watch it go up. Then you get sued for another $70,000 on a place you never got the keys to.

That isn’t a what-if. It’s happening in BC right now, and it’s happening in the same suburbs where families come to buy townhomes.

I’ve sold real estate in South Surrey and White Rock since 2007, and I’ve warned people about presales for a long time. This post walks through what changed, why so many buyers suddenly can’t close, how narrow the legal exits really are, and the three things that would have protected every buyer in these lawsuits.

Watch this part at 1:28

What the lawsuits look like

In July 2026, The Globe and Mail went through BC Supreme Court filings and counted about two dozen lawsuits brought by developers against individual presale buyers. The projects include two in Surrey, one in Langley, one in Port Moody, and more in Vancouver.

Every case has the same shape.

• A buyer signed a presale contract a few years ago and paid the deposit.
• When completion came, they didn’t close.
• The developer resold the unit, almost always for less.
• Now the developer is suing the first buyer for the gap, plus carrying costs, remarketing costs, strata fees on the empty unit, and legal fees.

To be fair, these are claims, not verdicts. And a developer enforcing a contract you signed is completely legal. It’s exactly what the paperwork always said could happen. You just never thought anyone would use it.

Reality Check: The law didn’t change. The market did. When prices were rising, developers shrugged off failed closings and resold for more. Now they’re going after every dollar.

A sales executive with Magnum Projects told the Globe that for two decades, developers would just resell a unit for more when a buyer couldn’t close, and sometimes even hand back part of the deposit to protect their reputation. That era is over.

Why presale buyers can’t close: the appraisal gap

Watch this part at 0:46

Here’s the part nobody explains before you sign.

When you buy a presale, you agree to a price today for a home that will exist in two, three, or sometimes four years. You pay a deposit, usually at least 10% and sometimes up to 20%, in stages as construction moves along.

Most buyers think they’ve locked in a deal. They haven’t. You locked in a price, not a value.

When the building finishes and you go for your mortgage, the lender sends an appraiser. The bank then lends against the lower of two numbers: the price you agreed to, or what the home appraises for today.

In plain English:

• You agreed to pay $700,000 and it appraises at $700,000. You’re fine.
• You agreed to pay $700,000 and it appraises at $600,000. The bank lends as if it’s a $600,000 home, but you still owe $700,000.

That missing $100,000 comes out of your pocket in cash, on top of the deposit you’ve already paid. If you’ve never faced one, here’s how I’d approach a low appraisal on a regular purchase, but on a presale the gap can be far bigger.

Often it’s a couple who stretched to get in at all. They qualified three years ago on three-year-old income, rates, and lending rules. Now they have to qualify all over again and find six figures nobody told them to plan for. Most of them aren’t walking away because they’re reckless. The math stops working.

What this looks like at South Surrey prices

Watch this part at 6:09

Most people buying in South Surrey or White Rock aren’t shopping for a $700,000 condo. So let’s use a new townhome at $1.1 million, which is a normal family home in a newer complex here.

The Fraser Valley Real Estate Board’s benchmark townhome price in July 2026 was $757,300, down 7.1% from a year earlier. Seven percent on $1.1 million is about $78,000 of value gone in 12 months.

Quick Stat: The same project marketer told the Globe that values in four low-rise Surrey projects his firm worked on had fallen from around $870 a square foot to closer to $700. That’s a drop of roughly 19.5%, nearly three times the resale decline.

That 7% is resale. It hides what happened to new construction. Put a 19.5% drop on a $1.1 million townhome and it’s worth about $885,000. You’d be roughly $215,000 underwater on a home you never lived in.

Now compare that to your deposit. Ten percent of $1.1 million is $110,000. Twenty percent is $220,000. At those numbers, walking away doesn’t just cost your deposit. It can cost your deposit and then some.

Is there a legal way out of a BC presale contract?

Watch this part at 8:00

There are two real exits. Both are narrower than you’d hope. I’m not a lawyer, and if you’re in one of these contracts right now, a real estate lawyer is the call to make today, not next week.

First, check whether your project is even covered by the Real Estate Development Marketing Act (REDMA). Most presales are, but not all new construction is. That’s the first question, not the last.

Exit one: the 7-day rescission period. Under the Real Estate Development Marketing Act, you can cancel in writing within 7 days and get your deposit back. The clock runs from the later of two dates: the day you signed the purchase agreement, or the day the developer received your signed acknowledgement that you had a chance to read the disclosure statement. It’s the cleanest exit you’ll get, and it expires quietly.

Exit two: a material change the developer didn’t handle properly. The developer has to keep the disclosure statement accurate. If something material changes, they must file an amendment immediately and get a copy to you within a reasonable time. If they don’t, you may have a right to cancel, in some cases even after completion, but only up to one year after title transfers.

This isn’t theoretical. In Ye v. Vesta Properties, a 2025 BC Supreme Court decision involving a Langley presale, the developer moved the estimated completion date a full year earlier. They filed the amendment, but buyers didn’t receive it for about six months. The court let the buyers out and their deposits were returned, because a completion date is a material fact. It changes how you plan every dollar.

How narrow the door really is

Watch this part at 12:14

Now look at the other side. In Rhythm Living v. Pereira, a 2026 case over a $799,000 presale in Sidney, BC, a leak was found two days before closing. Drywall had been cut open. The negotiated pergola and patio extension hadn’t been started. The EV charger and promised TV weren’t installed.

The buyers refused to close. The court disagreed on every point.

The judge said those unfinished items were terms of the contract, not conditions of it. The buyers could be owed money for them, but they couldn’t walk away over them. The moisture issue was limited to one bathroom and was being repaired, so the home was still livable.

The result: they lost their $75,000 deposit and were ordered to pay the developer more than $143,000 on top. That’s over $218,000.

Did You Know?: In BC, if you want an unfinished item to give you the right to cancel, your contract has to say that explicitly. Otherwise it’s usually just money owed, not a way out.

How do you protect yourself before buying a presale?

Watch this part at 15:41

Here’s where I land, and you’re welcome to disagree. I’ve worked with many of the developers named in that Globe article over the years, so I’m not throwing rocks from outside. But when buyers sit down in my office, I recommend resale over new construction every time. I’ve written before about why I’d never buy new construction in BC.

With resale, you walk through the actual rooms, see the actual finishes, and read the actual strata minutes. Most important, the price and the value are set on the same day. There’s no three-year gap for the market to open up underneath you, and no appraisal surprise. If you’re weighing both, compare new construction vs resale on your own numbers.

Some of you will buy a presale anyway. If you do, these three steps would have protected every buyer in those lawsuits.

1. Never walk into a sales centre without your own representation. Have it in place before your first visit. How you register at the door can affect whether you can bring your own agent at all. The salesperson at the desk works for the developer. That’s their job, and that’s who pays them. You want someone who owes you fiduciary duty and has actually closed presale contracts.
2. Underwrite the completion, not the signing. Your mortgage pre-approval today means nothing in three years. Ask your mortgage broker one question: if this home appraises 20% below my price on completion day, can I still close? On a $1.1 million townhome, that’s $220,000. If the answer is no, you can’t afford this contract, no matter what you qualify for today.
3. Read the disclosure statement and every amendment. This one is free and takes about 20 minutes. It holds your rescission window, the outside completion date, and every right the developer has to change things. Put the last day of your 7-day window and the outside completion date in your calendar with alarms. Every time an amendment lands, open it and compare it to the last one.

Pro Tip: The buyers who got their deposits back in the Vesta case caught the problem because someone actually read the paperwork. Almost nobody does, because the room is busy and only four units are left at that price.

That urgency isn’t an accident. Slow down and run the worst-case numbers before you sign.

For the full breakdown, watch the video at the top of this post.