Stratify Your Plex | Owner Developer
Owner Developer Duties in a Small Strata
If you deposit a strata plan and sell the units, the Strata Property Act makes you the owner developer, and sections 5 to 24 set your duties until the owners take over. You act as the council, pay the early costs, give each buyer an interim budget, fund the reserve, call the first annual general meeting on time and hand over the building's papers. Most duties carry a fixed penalty or a payment formula. This page sets out each one, with worked numbers, for a duplex to sixplex.
The Short Answer
- 01If you deposit the strata plan and sell the units, sections 5 to 24 of the Strata Property Act apply to you as the owner developer. Until the first annual general meeting (AGM), you act as the strata council (s.5).
- 02You pay every strata expense to the end of the month of the first sale (s.7), and at that sale you pay at least 10% of the interim budget's operating expenses into the contingency reserve fund (CRF) (s.12; Regulation s.3.01).
- 03Each buyer gets a 12-month interim budget before signing. If real costs run 10% to under 20% over it, you pay the difference plus 2 times the overage; at 20% or more, plus 3 times (s.13, s.14; Regulation s.3.1).
- 04The first AGM falls in the 6 weeks starting when 50% plus one of the lots are sold, or 9 months after the first sale if that is earlier. Late costs $1,000, plus $1,000 for each further 7 days after 30 days (s.16, s.17).
- 05At the first AGM you hand over plans, contracts, warranties, records and a contractor list, and money and keys follow within 1 week (s.20, s.22).
Every Duty, in Order
Section numbers are the Strata Property Act. "Reg" is the Strata Property Regulation.
| When | Duty | Source |
|---|---|---|
| From deposit | Act as the strata council, with the council's powers and duties. | s.5 |
| From deposit | Act honestly and with reasonable care, which includes pursuing warranty remedies for the strata. | s.6 |
| Deposit to first sale | Pay every strata expense up to the end of the month in which the first lot is conveyed. | s.7 |
| Before the first sale | You may pass resolutions alone. | s.8 |
| After the first sale | A contract between the strata and you or a related party needs a unanimous vote at a special general meeting. Most other 3/4 resolutions need a unanimous vote. | s.10, s.11 |
| At the first sale | Pay into the CRF at least 10% of the interim budget's operating expenses (more if the sale is later than 1 year after deposit). | s.12; Reg s.3.01 |
| Before each buyer signs | Give the buyer the interim budget for the 12 months starting the month after the first sale, with at least 10% to the CRF. | s.13; Reg s.3.01 |
| Within 8 weeks after the first AGM | Pay any amount by which real costs exceeded the interim budget, plus the penalty if the overrun is 10% or more. | s.14; Reg s.3.1 |
| Until 4 weeks after the first AGM | Keep the strata's property insurance in force. | s.15 |
| First AGM window | Hold the first AGM in the 6 weeks set by s.16, or pay the late penalty. | s.16, s.17; Reg s.3.1 |
| At the first AGM | Hand over the documents in s.20 and the Regulation's contractor list, and present a first annual budget for a majority vote. | s.20, s.21; Reg s.3.2, s.3.4 |
| Within 1 week after the first AGM | Give the council the strata's money and keys. | s.22 |
| 4 weeks after the second AGM | A management contract made before the first AGM ends, unless owners renew it by majority vote. | s.24 |
Acting as Council
From the moment the plan is deposited until the first AGM, you have the council's powers and duties (s.5). You must act honestly and with reasonable care, and that includes pursuing warranty remedies for the strata (s.6).
Before the first sale, you may pass resolutions alone (s.8). This is the time to file the bylaws you want on Form Y and to settle limited common property, because both get harder once a buyer owns a lot. The bylaws before you sell page explains why.
After the first sale, the other owners get protection. A contract between the strata and you, or a party related to you, needs a unanimous vote at a special general meeting (s.10). Most other resolutions that would need a 3/4 vote need a unanimous vote instead (s.11).
Paying the Early Costs and the Reserve Fund
You pay every strata expense up to the end of the month in which the first lot is conveyed (s.7). At that first sale, you also pay into the contingency reserve fund (CRF). The minimum is a percentage of the operating expenses in the interim budget: 10% if the first sale is within 1 year of deposit, and if later, the lesser of 10% times the years since deposit, or 50% (s.12; Regulation s.3.01). These rates have applied since November 1, 2023; before that they were 5% and 25%.
Example with $10,000 of operating expenses in the interim budget (our arithmetic):
| First sale | Rate | Minimum CRF payment |
|---|---|---|
| First sale 8 months after deposit | 10% | $1,000 |
| First sale 2 years after deposit | 10% x 2 = 20% | $2,000 |
| First sale 3 years after deposit | 10% x 3 = 30% | $3,000 |
| First sale 6 years after deposit | Capped at 50% | $5,000 |
The Interim Budget and the Overrun Penalty
Every buyer gets the interim budget before they sign. It covers the 12 months starting the month after the first sale, and the CRF line in it must be at least 10% (s.13; Regulation s.3.01).
If real costs over those 12 months come in higher than the budget, you pay the difference within 8 weeks after the first AGM. If the overrun is 10% to under 20%, you pay 2 times the overage on top. If it is 20% or more, you pay 3 times the overage on top (s.14(4), (5); Regulation s.3.1). If costs come in lower, the surplus goes back to owners, unless no owner would get more than $100 (s.14(6), (7)).
Example with a $10,000 interim budget (our arithmetic):
| Real costs | Over budget | You pay | How |
|---|---|---|---|
| $10,500 | 5% | $500 | The difference only. |
| $11,500 | 15% | $4,500 | $1,500 difference plus 2 x $1,500. |
| $12,500 | 25% | $10,000 | $2,500 difference plus 3 x $2,500. |
Price the insurance line from a real quote. The strata must insure the buildings at full replacement value and carry at least $2,000,000 of liability insurance (s.149; Regulation s.9.2). The budget page covers the other lines.
The First AGM
The first AGM must be held in the 6 weeks that start on the earlier of two dates: when 50% plus one of the lots have been sold, or 9 months after the first sale (s.16). In a fourplex, the third sale is 50% plus one. In a duplex, the second sale is. If units sell slowly, the 9-month date comes first.
A late meeting costs you $1,000 for up to 30 days, plus $1,000 for each further 7 days (s.17; Regulation s.3.1). At 44 days late, that is $3,000 (our arithmetic).
Your property insurance must stay in force until at least 4 weeks after the first AGM (s.15). In December 2025, first buyers in a Vancouver 4-plex wrote to the Condo Smarts newspaper column: the developer had said there were no strata fees for the first year, and the insurance ran out in a month. The Act's answer has three parts. You pay every expense only to the end of the month of the first sale (s.7). The interim budget then covers the next 12 months, and you pay any overrun on it (s.14). And the insurance cannot end before 4 weeks after the first AGM.
The Handover
At the first AGM you must give the strata these items (s.20; Regulation s.3.2):
- Building permit plans and any amendments, and documents showing services located away from the plans
- All contracts
- Any disclosure statement filed under REDMA
- The registered strata plan
- A list of contractors and suppliers for electrical, heating, plumbing, elevators, exterior walls, windows and doors, roof, foundations, building envelope consultants and the project manager (Regulation s.3.2)
- All warranties and manuals
- The records the strata must keep under s.35
- A first annual budget for owners to approve by majority vote, with at least 10% of the operating fund contribution going to the CRF (s.21; Regulation s.3.4)
Within 1 week after the meeting, the strata's money and keys go to the new council (s.22). A management contract you signed before the first AGM ends 4 weeks after the second AGM unless owners renew it by majority vote (s.24).
The record rules apply at every size. Another Condo Smarts letter, from August 2025, asked whether a Nanaimo 5-plex could run "casually" with no records, financial statements or insurance papers. Section 35 lists the records every strata must keep, and section 20 makes you hand them over. The forms and records page has the full list and how long each record is kept.
The Depreciation Report Contribution
A strata of 5 or more lots must have a depreciation report, a professional study of the cost and life of the building's major parts (Regulation s.6.21). For a strata formed on or after July 1, 2027, you pay toward the first report the lesser of $5,000 plus $200 per lot, or $30,000, by the first AGM (Regulation s.6.23).
- 5 lots: $5,000 + (5 x $200) = $6,000
- 6 lots: $5,000 + (6 x $200) = $6,200
A strata of fewer than 5 lots is exempt from the depreciation report (Regulation s.6.22). Our sources do not say whether the s.6.23 payment applies to a strata that needs no report. A strata formed between July 1, 2024 and before July 1, 2027 needs its first report within 2 years of the first AGM. The depreciation report page lists who may prepare one.
Best For
- ✓ Builders who sell a new duplex to sixplex unit by unit
- ✓ Owners who keep one unit and sell the rest
- ✓ Anyone who wants the first owners to start with a working budget and records
Usually Fails When
- ✕ The interim budget is set low to help sales and costs run 10% or more over it
- ✕ The first AGM slips past its 6-week window while the last units sell
- ✕ Insurance lapses before 4 weeks after the first AGM
What To Verify Before Spending Money
- → The date of the first sale and the date 50% plus one of the lots sold
- → Real costs against the interim budget each month
- → The handover list against what you hold
Duties at Each Sale
A buyer from the owner developer holds back 7% of the gross price for up to 55 days, and liens against the lot must be filed within 45 days of the sale (s.88; Regulation s.5.2). The Construction Prompt Payment Act, assented November 27, 2025, amends s.88, but that change is not in force.
At 5 or more strata lots, the Real Estate Development Marketing Act (REDMA) applies. You cannot market the units until a disclosure statement is filed, each buyer signs for a copy before the contract, deposits go into a brokerage, lawyer or notary trust account, and buyers can cancel within 7 days (REDMA s.14, s.15, s.18, s.21). The filing fee is $2,250 for fewer than 10 units. Under 5 lots, the 3-business-day Home Buyer Rescission Period applies instead.
Warranty Duties
Under the Homeowner Protection Act (HPA), no new home may be sold, or offered for sale, during construction or within 10 years of the first occupancy permit unless it is covered by home warranty insurance or is exempt (HPA s.22). The minimum cover is 2 years on materials and labour, 5 years on the building envelope and 10 years on the structure.
Where no warranty insurance applies, the builder and the seller still owe the same 2, 5 and 10 year protection (HPA s.23). Suits must start within 10 years of first occupancy, or for strata common property, within 10 years of plan deposit. As council before the first AGM, you must also pursue warranty claims for the strata (s.6).
A building enrolled under the rental exemption carries a covenant that bars the sale of any unit for 10 years from first occupancy (HPA Regulation s.2). The rent now, stratify later page covers that choice.
Common Questions
What is an owner developer in a BC strata? +
In plain terms, the person who files the strata plan and sells the strata lots. Sections 5 to 24 of the Strata Property Act set their duties: acting as council until the first AGM, paying early expenses, the interim budget, the reserve fund payment, the first AGM and the handover.
What is an interim budget in a strata? +
The budget the owner developer gives each buyer before they sign. It covers the 12 months starting the month after the first sale, and at least 10% of it must go to the contingency reserve fund (Strata Property Act s.13; Regulation s.3.01).
What happens if the interim budget is too low? +
The owner developer pays the difference within 8 weeks after the first AGM. If costs ran 10% to under 20% over, it also pays 2 times the overage; at 20% or more over, 3 times (s.14; Regulation s.3.1). If costs came in under budget, the surplus is refunded unless no owner would get more than $100.
Who pays strata fees before the first unit is sold? +
The owner developer pays every strata expense up to the end of the month in which the first strata lot is conveyed (s.7).
How much does the developer put in the contingency reserve fund? +
At the first sale, at least 10% of the interim budget's operating expenses if that sale is within 1 year of deposit. If later, the lesser of 10% for each year since deposit, or 50% (s.12; Regulation s.3.01, in force since November 1, 2023).
When is the first AGM of a new strata? +
Within the 6 weeks that start on the earlier of two dates: when 50% plus one of the strata lots have been sold, or 9 months after the first sale (s.16).
What is the penalty for a late first AGM? +
$1,000 for up to 30 days late, plus $1,000 for each further 7 days (s.17; Regulation s.3.1). At 44 days late, that is $3,000 (our arithmetic).
What must the owner developer hand over at the first AGM? +
Building permit plans, every contract, any REDMA disclosure statement, the registered strata plan, a list of contractors and suppliers, all warranties and manuals, and the strata's records. Money and keys go to council within 1 week after the meeting (s.20, s.22; Regulation s.3.2).
Can the owner developer sign contracts for the strata? +
From deposit it acts as council, and before the first sale it may pass resolutions alone (s.5, s.8). After the first sale, a contract between the strata and the owner developer or a related party needs a unanimous vote at a special general meeting (s.10).
Does the owner developer pay toward the depreciation report? +
For a strata formed on or after July 1, 2027, the owner developer pays the lesser of $5,000 plus $200 per lot, or $30,000, by the first AGM (Regulation s.6.23). That is $6,000 for 5 lots and $6,200 for 6 lots. A strata of fewer than 5 lots needs no depreciation report.
When can the owner developer stop paying for strata insurance? +
Its property insurance must stay in force until at least 4 weeks after the first AGM (s.15).
Does a management contract signed by the developer continue after handover? +
A management contract made before the first AGM ends 4 weeks after the second AGM, unless owners renew it by majority vote (s.24).
What warranty duties does the owner developer have? +
As council it must pursue warranty remedies for the strata (s.6). Under the Homeowner Protection Act, a new home sold within 10 years of the first occupancy permit must have home warranty insurance or be exempt (s.22). Without insurance, the builder and seller still owe 2, 5 and 10 year protection (s.23).
Read Next
Official Sources
StraPlex waitlist
Get StraPlex when it opens
One app for 2 to 6 owners: the steps and documents to get your strata titles, then the budget, reserve fund, meetings, records and insurance dates once the strata exists. Join the waitlist and get access first.