Real Estate Deposits in BC: What First-Time Buyers Need to Know
When you make an offer on a home, the deposit is your first tangible commitment — the good-faith money that tells the seller you’re serious. But knowing how much to put down, when it’s due, and how it factors into your purchase can be the difference between a smooth closing and a costly mistake. Here’s everything you need to know about deposits before you write your next offer.
What Is a Deposit in Real Estate?
A deposit is the good-faith money you put down once your offer to purchase a home becomes firm. It’s not a separate cost — it forms part of your overall down payment and counts toward your final purchase price.
The deposit serves two practical purposes.
- First, it gives the seller security, showing you have real skin in the game and are financially committed to the deal.
- Second, it acts as a pre-estimated measure of damages if the contract is breached — essentially, it’s what you stand to lose if you walk away from a completed deal without valid grounds.
In short: it gives you something on the line, which is exactly why sellers take it seriously. Deposits are typically paid by bank draft, though a certified cheque may be accepted depending on the brokerage’s policy.
When Is the Deposit Due?
In Greater Vancouver, the deposit is typically due within 24 hours of subject removal — but the default under a standard purchase agreement is actually 24 hours of acceptance, unless your contract states otherwise.
This distinction matters more than most buyers realize. If your offer includes subjects — financing, inspection, or anything else — your agent needs to explicitly write that the deposit is due within 24 hours of subject removal, not acceptance. Otherwise, you could be contractually required to hand over your deposit before you’ve even confirmed financing or completed your inspection. A skilled agent can also negotiate alternative deposit deadlines written directly into the contract, such as a specific date and time.
One more thing worth knowing: in a multiple offer scenario, having your deposit funds liquid and ready to go is a real negotiating advantage. It signals to the seller that you’re capable and prepared to close — which becomes especially important if you’re submitting a subject-free offer.
How Much Should Your Deposit Be?
In Greater Vancouver, the standard deposit is 5% of the purchase price. If the seller counters your offer, the deposit amount usually stays tied to your original offer price rather than being renegotiated. That said, there’s no legally fixed minimum — 5% is convention, not law.
In competitive, multiple-offer situations, it’s common for buyers to offer a higher deposit — 10% or more — as a way to strengthen their position. A larger deposit tells the seller two things: you have the financial capacity to close, and you have more to lose by walking away, which makes you a lower-risk buyer in their eyes. The higher the deposit, the more attractive your offer tends to look.
The flip side is worth knowing too: offering less than the standard 5% can raise red flags. Sellers and their agents may read a low deposit as a sign you’re financially stretched or not fully committed — which can quietly work against you, even if your offer price is competitive.
Who Should the Deposit Be Made Out To?
In BC, your deposit is always made payable to your buyer’s agent’s brokerage and held in a regulated trust account — never directly to the seller. When I’m representing you as a buyer, your minimum 5% deposit will be made out to Oakwyn Realty Ltd. In Trust.
Here’s the reassurance most first-time buyers want to hear: your brokerage cannot touch that money for its own expenses, payroll, or anything else. Trust accounts in BC are heavily regulated and routinely audited, so your funds are protected by law, not just by good faith.
If you’re purchasing a presale, the process can look a little different — the deposit may instead be made out to the developer’s notary, lawyer, or the developer’s realtor’s brokerage. Whether you’re buying resale or presale, always confirm exactly who your deposit should be made out to before it’s due. This is a detail you want locked down well in advance, not scrambled together at the last minute.
Does My Deposit Count Toward My Down Payment?
Yes — your deposit isn’t a separate cost on top of your down payment, it’s part of it. It gets applied directly toward your purchase price at closing.
To know exactly what you’ll owe on completion day, have your notary or lawyer prepare a statement of adjustments. This document breaks down your final numbers so there are no last-minute surprises — and in real estate, surprises are exactly what you want to avoid.
What Happens to My Deposit If I Can’t Get Financing?
This comes down entirely to how your contract is worded — which is exactly why working with an experienced agent on your contract terms matters.
If your offer is “subject to financing” and your agent has specified that the deposit is due after subject removal (rather than upon acceptance), you simply haven’t handed in your deposit yet. If financing falls through, your agent notifies the listing agent, the deal collapses, and you walk away with no money lost.
If you’ve already submitted your deposit contingent on financing and you’re unable to secure it, your deposit should be refunded in full. The key word here is should — which is why reading your contract of purchase and sale thoroughly, before signing anything, is non-negotiable.
One important caveat: if you fail to remove a subject and the seller believes you didn’t act in good faith to fulfill that condition — for example, not genuinely trying to secure financing — they can pursue legal action. If your deposit is already in and subjects haven’t been removed, they can refuse to release it. Bottom line: when removing subjects, make sure you can clearly demonstrate why the condition couldn’t be met.
What Happens If My Deposit Is Late?
Missing your contractual deposit deadline puts you in breach of agreement — full stop. This gives the seller grounds to walk away from the deal entirely. And if they have a stronger backup offer waiting in the wings, or other interested buyers circling, a late deposit can become their opportunity to sell for more. Simply put: never be late with your deposit.
Can I Pull My Deposit From My RRSP?
Yes. The federal Home Buyer’s Plan allows you to withdraw up to $60,000 in a calendar year from your RRSP to buy or build a qualifying home, for yourself or a related person with a disability.
If your funds are sitting in an RRSP, contact your financial institution early to confirm they can process the withdrawal within a week of your accepted offer. For more information, check out this article: Home Buyer’s Program RRSP.
Pro tip: RRSP withdrawals can take 5–10 business days to process — timing that can put your deal at risk of collapsing if your deposit deadline arrives first. Many buyers set up a line of credit in advance specifically to cover their deposit if funds are tied up in investments or slow to access. Talk to your bank about whether this makes sense for you before you’re under contract.
“I Wrote a Subject-Free Offer — Can I Back Out of My Deposit?”
In competitive markets, it’s common to see 20+ offers on a single property, and sellers naturally gravitate toward the subject-free offer — one with no financing or inspection conditions. Once that offer is accepted, the only thing left for the buyer to do is submit the deposit.
Buyer’s remorse happens. Sometimes a buyer realizes the next morning they paid more than they intended. But once a deal is firm and there are no subjects to remove, you are legally obligated to proceed and provide your deposit — regret doesn’t change that.
Purchase agreements are signed under seal and are legally binding. Refusing to hand over a deposit after subjects are removed, or on a subject-free deal, can result in being sued.
As a Buyer, What Happens If I’ve Removed Subjects but Can’t Complete?
Once your deal is firm, your deposit exists specifically to protect the seller if you fail to complete — which means you will lose it. Beyond that, the seller can also sue for additional damages, calculated based on their actual financial losses from the breach.
For example: if market value drops $50,000 between your accepted offer and your refusal to complete, that drop counts as a loss the seller can pursue. This gets especially complicated if the seller has already purchased their next home using proceeds from this sale. If you find yourself in this position, contact your lawyer immediately — don’t wait to understand your exposure.
As a Seller, What Happens If the Buyer Doesn’t Complete?
In most cases, once a deal has gone firm and subjects are removed, you as the seller keep the deposit and retain the right to sue the buyer for additional damages. This process can get complicated quickly, particularly if you’ve already purchased your next property. As with any breach situation, your first move should be contacting your lawyer immediately to understand your options and next steps.
Bottom Line
Your deposit isn’t just a formality — it’s a strategic piece of your offer that can strengthen or weaken your position depending on how it’s structured. Before you write your next offer in Coquitlam, Burnaby, Vancouver, Surrey, or Langley, let’s make sure your deposit terms are working in your favour, not against you.
