In a private sale in Surrey to family or a tenant, the risk sits in the terms

Can I sell my house to my child for less than it's worth?

Yes, you can sell your house to your child below market value, but the discount has consequences. Property Transfer Tax is assessed on fair market value, the income tax rules may treat you as selling at full value, the lender may call the discount a gift, and your other children may inherit less unless your will accounts for it.

Property Transfer Tax is charged on the value of the interest transferred. The related-individual exemptions are narrow, with conditions about how the home was used, and many family sales fall outside them, so plan on tax at full value unless an exemption is confirmed.

For income tax, s. 69 of the Income Tax Act generally treats a sale to a relative below value as made at market value for the seller, while the child's cost stays at the lower price paid. The principal residence exemption may cover the seller, but the gap can return when the child sells. An accountant should see the numbers before the price is set.

The child's lender will want the down payment explained. Many accept the discount as all or part of it, with a gift of equity letter from the parents and an appraisal supporting the value.

If the child later separates, the discount can be excluded property under s. 85 of the Family Law Act, but only if it was a gift to the child rather than the couple, so the documents should name the child. And under WESA, a lifetime gift is generally not deducted from an inheritance unless the will or a written record says so, so the other children inherit from a smaller estate unless the will evens it out.

Is selling to a family member different from gifting a share?

Yes, selling to a family member is a sale: money changes hands under a written contract, with a completion date, adjustments for property tax and utilities, and often a lender. A gift of a share involves no price at all, is documented differently, and may qualify for different tax exemptions. Many family deals are partly each.

A sale at a family price is part sale and part gift, and both parts need a record: the contract for the price, and a gift letter or deed of gift for the discount. If no money is changing hands at all, it is a title transfer rather than a sale, and our title transfers page is the place to start.

Can the seller finance part of the price?

Yes. A seller can lend part of the price to the buyer through a vendor take-back mortgage, registered against the home at completion. If the buyer also has a bank mortgage, the seller's mortgage usually ranks second, behind the bank's, and the bank usually has to agree to the secondary financing before completion.

The vendor take-back uses the same mortgage form any lender registers, with terms written in or drawn from standard terms on file at the LTSA: the amount, rate, payment schedule, due date, prepayment rights, and what happens on a sale or refinance.

Ranking second matters if things go wrong. If the buyer stops paying, the seller can sue on the promise to pay and ask the Supreme Court of British Columbia for foreclosure, a court-supervised process rather than a quick repossession. If the bank forecloses first, it is paid in full before the seller sees anything.

Parents lending to a child should take independent legal advice on the mortgage they are taking back, as should a child's spouse signing it, and the family should talk through what a missed payment means before anything is drafted.

What changes when my tenant buys the home they rent?

When a tenant buys the home they rent, the tenancy ends at completion, because the tenant becomes the owner. Their security deposit and any pet damage deposit, with any interest owed, are credited to them on the statement of adjustments, and rent is adjusted to the completion date. They still need an inspection and a title search.

The Residential Tenancy Act governs the deposits until completion; crediting them on the statement of adjustments keeps that money moving through the lawyers' trust accounts with everything else.

A tenant who has lived in the home for years knows the rooms but not necessarily the roof, the drains, the permits for a basement suite, or what is registered on title. An inspection and a title search still matter, and so does checking whether any work the tenant did themselves had permits.

If the sale fails, the contract should say the tenancy simply carries on under its existing terms.

Can I stay in the home after I sell it?

Yes, a seller can stay after completion under a rent-back, which is a written tenancy between the buyer as landlord and the seller as tenant. The contract has to deal with possession, the buyer's lender and insurer need to know, and once the tenancy exists the seller has a tenant's rights.

Most contracts promise vacant possession. A rent-back replaces that with possession subject to the seller's tenancy, and the contract and tenancy agreement should match on rent, the end date and the home's condition.

A rent-back of a home is generally a tenancy under the Residential Tenancy Act, so the buyer cannot simply require the seller to leave on an agreed date. Whether a fixed term can require the tenant to move out at its end depends on the Act's limits on those terms. A seller who needs only a few extra days may be better served by a later possession date.

The buyer's lender may have approved the mortgage on the basis that the buyer will live there, and their insurance may not cover a home occupied by a tenant; both should hear about the rent-back first.