The question about deposits and what is standard is one that often comes up when considering buying a presale home.

Most presale new homes require a total deposit of 15–20% of the purchase price. However, some developers offer limited opportunities to buy with a 5% or 10% deposit, particularly if it is getting close to completion. Developers are often subject to requirements from their banks as well which is why a 15–20% deposit is needed in most cases or why they can’t be more flexible at times.

This total deposit will likely be paid in stages. In British Columbia, a developer can legally only collect 10% of the purchase price prior to filing an Amendment to the Disclosure Statement notifying an issuance of a building permit. Once the amendment has been filed notifying you of the building permit, you will receive a copy of the amendment from the developer likely with a request for the remaining deposit funds assuming your purchase required more than a 10% deposit. This will all be in accordance with your Contract of Purchase and Sale so it should not be a surprise. Further deposits may also be due as per your Contract of Purchase and Sale and the timeframe for this will vary depending on when you buy. For instance, your deposits may all be due at time of offer or it could be over the course of a year or more. Make sure you review this section with your sales representative and/or realtor to ensure you understand what your obligations will be and when deposit money may be due.

Additionally, you should be aware that the deposit is typically based on the purchase price before any upgrades or options. If, while purchasing your home, you ask for something to be added or customized the developer is allowed to ask for and collect a larger deposit for the customization. Some developers require 100% of the customization cost while others require only 30% to 50% of the customization cost.

Regardless, it is fair to say that when looking to buy a presale home you should be prepared to pay at least a 10% deposit at the time of purchase with the potential for more. Make sure you review the requirements with your sales representative and/or realtor before purchasing.