How to Sell Your Land to Multiplex Developers in Vancouver: The Complete Guide

The Vancouver land market has fundamentally shifted. According to CBRE broker Robert Veerman, by the end of 2024, property purchases intended for multiplex redevelopment represented about one-third of all residential dollar sales in Vancouver. That’s not a trend—it’s a transformation.

If you own a single-family lot in Vancouver, you’re sitting on an asset that developers are actively seeking. But selling to a developer is nothing like selling to a traditional homebuyer. The valuation methods are different. The contracts are more complex. The timelines are longer. And the potential for leaving money on the table is substantial.

After two decades helping Vancouver homeowners navigate these transactions, I’ve seen the full spectrum—sellers who captured every dollar of value, and sellers who accepted the first offer without understanding what they had. This guide is designed to put you firmly in the first category.

Part 1: Understanding Why Developers Want Your Land

The Bill 44 Effect

Before September 2023, building a multiplex on a single-family lot required rezoning—a process that could take years and had uncertain outcomes. Bill 44 changed everything. Now, under Vancouver’s R1-1 Residential Inclusive Zone, you can build:

• 3-4 units on lots with minimum 3,294 square feet
• 5 units on lots with minimum 4,994 square feet
• 6 strata units on lots with minimum 5,995 square feet
• Up to 8 units if all units are secured as rental tenure

The Floor Space Ratio (FSR) can reach 1.0 (meaning total floor area equals 100% of lot area), compared to the approximately 0.6-0.7 FSR typical for single-family homes. This additional buildable area is what creates development value.

The Market Reality

As of mid-2025, there are over 455 permit applications for multiplexes in Vancouver. About 16 multiplexes have been fully built and sold under the new rules, with 82 development permits and 75 building permits issued—equivalent to 300+ new units coming online in the next 12-18 months.

Developers are actively acquiring sites because the math works. Recent sales of completed multiplex units show prices ranging from $997 to $1,777 per square foot, with a median around $1,414/sq ft in Vancouver West. Developers are targeting $1,250-$1,390/sq ft for resale depending on location and design.

When a developer can build 6 units totaling 6,000 square feet and sell them at $1,300/sq ft, that’s $7.8 million in gross revenue—from a lot that might sell for $2.5 million as a single-family home. The gap between those numbers is why developers are paying premiums.

Part 2: How Developers Value Your Land

Understanding how developers price land is essential to negotiating effectively. They don’t use comparable sales the way residential buyers do. They use residual land value analysis.

The Residual Land Value Formula

The concept is simple:

Residual Land Value = Gross Development Value − (Construction Costs + Soft Costs + Developer Profit)

Let’s break down each component:

1. Gross Development Value (GDV)

This is what the completed multiplex will sell for. Developers estimate this by:

• Analyzing recent sales of similar new-construction units in the area
• Adjusting for unit mix, finishes, and market conditions
• Applying a realistic absorption timeline (how long to sell all units)

Example: A 6-unit multiplex with 6,500 sellable square feet at $1,300/sq ft = $8.45 million GDV

2. Hard Construction Costs

Current Vancouver multiplex construction costs range from $350 to $550+ per square foot, depending on:

• Site conditions (flat lot vs. sloped, rock, poor soil)
• Building complexity and finish level
• Access for machinery (narrow lots cost more)
• Wood frame vs. concrete construction

Example: 6,500 sq ft at $425/sq ft = $2.76 million hard costs

3. Soft Costs

These include:

• Architectural and engineering fees
• Permits and city fees (can exceed $120,000 per unit in Vancouver)
• Legal fees
• Financing costs (construction loan interest)
• Marketing and sales commissions
• Insurance
• Project management

Soft costs typically run 15-25% of hard costs.

Example: $2.76M × 20% = $552,000 soft costs

4. Developer Profit

The City of Vancouver acknowledges a developer’s profit of 15% based on total project costs, including land. In practice, developers target 15-20% returns.

Example: Total costs before profit = $2.76M + $552K + land cost. If targeting 15% profit on a $2.5M land cost, that’s roughly $870,000.

Calculating Residual Land Value

Using our example:

• GDV: $8,450,000
• Hard costs: $2,760,000
• Soft costs: $552,000
• Developer profit (15% on costs): ~$870,000

Residual Land Value = $8,450,000 − $2,760,000 − $552,000 − $870,000 = $4,268,000

But wait—that’s the maximum a developer could pay while still hitting their return targets. In practice, they’ll bid lower to build in contingency and improve returns. Expect offers at 70-85% of theoretical maximum.

Why This Matters for You

Traditional residential valuation would compare your house to similar houses that sold recently. If comparable single-family homes sold for $2.2 million, that’s what a residential buyer would pay.

But a developer sees a $4.2 million development site. Even at 75% of theoretical maximum, that’s $3.15 million—$950,000 more than residential value.

The homeowners who capture this premium are the ones who understand residual land value and can demonstrate their property’s development potential to buyers.

Part 3: Is Your Property Eligible?

Not all lots are equal in developers’ eyes. Here’s how to assess your property’s multiplex potential.

Zoning Requirements

Your property must be in an eligible zone. In Vancouver, this includes:

• R1-1 (Residential Inclusive Zone—most former RS zones)
• RT-7 and RT-9 (two-family zones with multiplex options)

Use VanMap to confirm your zoning.

Lot Size Thresholds

Under R1-1 zoning:

Minimum Lot Size	Maximum Units (Strata)	Maximum Units (Rental)
~3,294 sq ft	3-4 units	4 units
~4,994 sq ft	5 units	6 units
~5,995 sq ft	6 units	8 units

Larger lots command higher prices because they support more units and more sellable square footage.

Lot Dimensions Matter

Developers prefer:

• Wider frontages (49.5+ feet unlocks maximum unit counts)
• Regular rectangular shapes (irregular lots waste buildable area)
• Rear lane access (simplifies parking and unit access)
• Flat or gently sloping terrain (reduces foundation costs)

A 50’ × 120’ lot (6,000 sq ft) with lane access is ideal. A 33’ × 180’ lot (same area) is less attractive due to design constraints.

Site-Specific Factors

Developers will assess:

Positive factors:

• Corner lot (more design flexibility, better light)
• South-facing rear (desirable for outdoor space)
• No significant trees requiring retention
• Existing services (sewer, water, hydro) adequately sized
• No easements or rights-of-way restricting buildable area

Negative factors:

• Protected trees (costly to build around or impossible to remove)
• Rock or poor soil conditions (expensive excavation/foundations)
• Heritage designation (may restrict demolition)
• Narrow lot frontage (limits unit count and design options)
• Contamination risk (former gas station, dry cleaner, etc.)

The 90% Rule: No Basements

A significant majority (~90%) of multiplex applicants have opted to design without basements. The City updated height and FSR regulations to enable 3-storey above-grade multiplexes without basements, reducing cost and site disruption.

This means developers focus on lots where 3-storey above-grade construction is viable—typically lots without extreme slopes.

Part 4: Preparing Your Property for Sale

Before listing, take steps to maximize your property’s appeal to developers.

Gather Essential Documents

Developers will want:

• Title search (shows ownership, easements, covenants)
• Survey certificate (confirms lot dimensions and boundaries)
• BC Assessment property details (lot size, improvements)
• Utility information (existing services, capacity)
• Any existing permits or plans (even outdated ones provide information)

Having these ready accelerates due diligence and signals you’re a serious seller.

Conduct a Preliminary Feasibility Assessment

Consider hiring an architect or planning consultant to produce a preliminary feasibility study showing:

• Maximum buildable area under current zoning
• Potential unit count and approximate unit sizes
• Basic site plan showing building footprint
• Identification of any constraints (trees, setbacks, easements)

This costs $2,000-$5,000 but can add tens of thousands to your sale price by demonstrating development potential to buyers who might otherwise discount the site for uncertainty.

Address Obvious Issues

If your property has:

• Deferred maintenance: Fix obvious problems that might raise concerns about hidden issues
• Environmental concerns: Consider a Phase 1 Environmental Site Assessment ($2,500-$4,000)
• Unclear boundaries: Get a fresh survey if the existing one is outdated
• Tenant occupancy: Understand your obligations under BC’s Residential Tenancy Act

Don’t Over-Invest

Developers will demolish your house. Don’t spend money on renovations, landscaping, or cosmetic improvements. They’re buying the land, not the structure.

Part 5: Marketing to Developers

Selling to developers requires different marketing than selling to residential buyers.

Finding Developer Buyers

Active marketing channels:

• Commercial real estate brokerages (CBRE, Colliers, Cushman & Wakefield, NAI Commercial)
• Specialist multiplex brokerages (Multifamily Real Estate Services, MultiplexInVancouver)
• Developer networks (experienced realtors maintain relationships with active buyers)
• Off-market outreach (direct contact with developers who’ve built in your area)

Passive exposure:

• MLS listing with development potential prominently featured
• Signage noting “Development Opportunity” or “Multiplex Potential”

Crafting the Right Listing

Developer-focused listings emphasize:

• Lot dimensions and area
• Zoning designation (R1-1, RT-7, etc.)
• Maximum unit count under current regulations
• FSR potential
• Site advantages (lane access, corner lot, no significant trees)
• Preliminary feasibility if available

They de-emphasize:

• House features, renovations, finishes
• Interior photos (unless relevant to rental income during holding period)
• Comparable residential sales

Generating Competition

The worst outcome is a single developer negotiating against you alone. The best outcome is multiple developers competing for your site.

Strategies to generate competition:

• Set an offer date: Market the property for 2-3 weeks, then review all offers on a specific date
• Price strategically: Price below theoretical residual land value to attract multiple bidders
• Qualify buyers: Ensure bidders have capital, track record, and genuine intent
• Transparency: Let buyers know they’re competing (without disclosing specific offers)

Competition typically adds 5-15% to final sale price compared to negotiating with a single buyer.

Part 6: Understanding Developer Contracts

Developer purchase contracts differ significantly from residential contracts. Here’s what to expect and negotiate.

Extended Due Diligence Periods

Residential buyers typically have 5-7 business days for subject removal. Developers often request 30-90 days to complete:

• Detailed feasibility analysis
• Preliminary design work
• Construction cost estimates
• Financing approval
• Legal review of title and covenants

Negotiation tip: Longer due diligence periods benefit the developer (free option on your property) and cost you (property off market). Consider:

• Non-refundable deposits during due diligence
• Staged deposits that increase if they extend
• Hard deadlines with extension fees

Subject Clauses

Common developer subject clauses include:

Subject to Satisfactory Due Diligence A catch-all that allows the developer to exit for almost any reason. Push for specificity—what exactly are they investigating?

Subject to Financing Developers need construction financing. This is reasonable, but set a deadline and require evidence of financing capacity upfront.

Subject to Permits Some developers want the right to exit if permits aren’t approved as expected. This shifts regulatory risk to you. Counter-proposals:

• Accept subject to permits only for unusual conditions (heritage, environmental)
• Require the developer to demonstrate the issue is material (not minor design changes)
• Negotiate a price reduction mechanism instead of exit right

Subject to Partner/Board Approval Legitimate for larger developers with investment committees. But it’s also an easy exit. Require specificity on approval process and timeline.

Extended Closing Timelines

Developers often request 6-18 month closings to:

• Complete permit applications
• Secure construction financing
• Coordinate with construction schedule
• Sell existing inventory to fund purchase

Your considerations:

• Longer closing = more risk the deal falls through
• Longer closing = delayed access to sale proceeds
• Longer closing = continued carrying costs (taxes, insurance, maintenance)

Negotiation strategies:

• Higher deposit amounts (15-25% vs. standard 5-10%)
• Non-refundable deposits after subject removal
• Price escalation for extended closing
• Right to continue marketing if developer defaults

Price Adjustments and Earnest Money

Deposit structure matters:

• Initial deposit upon acceptance (typically 5%)
• Additional deposit upon subject removal (bringing total to 10-15%)
• Further deposit if closing extends beyond initial date
• Non-refundable portions after specific milestones

Contract price considerations:

• Fixed price (simplest, but locks in value regardless of market changes)
• Price tied to appraisal (protects against lowball offers, but creates uncertainty)
• Price adjustments for permit outcomes (rarely advisable—shifts developer risk to you)

The Holdback Clause Trap

Some developers request holdbacks—portions of the purchase price held in trust pending permit approval or other conditions post-closing. These are almost always unfavorable to sellers:

• You’ve transferred title but don’t have full payment
• Disputes over release are expensive and time-consuming
• Developer bankruptcy risk falls on you

Recommendation: Reject holdbacks. If the developer wants protection, they should extend the closing date with appropriate deposits, not transfer risk to you post-closing.

Part 7: Land Assembly Considerations

Sometimes your property is worth more as part of a larger assembled parcel than sold individually.

What Is Land Assembly?

Land assembly is the process of combining adjacent properties into a single larger parcel for sale to a developer. The assembled parcel enables larger projects (townhomes, larger multiplexes, or mid-rise buildings) that wouldn’t be possible on individual lots.

When Assembly Makes Sense

Assembly may be worth pursuing if:

• Your lot alone has constraints (narrow, small, poor shape)
• Adjacent lots have similar owners willing to sell together
• Zoning allows significantly more density on assembled parcels
• Developer demand exists for larger sites in your area

Important: Under R1-1 zoning, consolidation or assembly of sites is not permitted for multiplex projects. Multiplexes are designed as single-site developments. However, assembly remains relevant for:

• Townhome developments
• Low-rise apartment projects
• Mixed-use developments where different zoning applies

Assembly Challenges

The #1 reason land assemblies fail is one homeowner feeling entitled to more money than their neighbours. This commonly occurs when:

• They have a corner lot
• Their home is newer or larger
• They believe their property is “key” to the assembly

Reality check: Developers run analysis based on lot size and buildable area, not the age or quality of your home. If you demand a premium that breaks the assembly economics, the developer will either:

• Exclude your lot and redesign around it
• Walk away from the entire assembly
• Find a different assembly opportunity elsewhere

Assembly Pricing

Participating in a land assembly can increase your property’s value by 20% to 50% or more compared to individual sale, driven by:

• Reduced per-lot transaction costs for the developer
• Larger project economics (more units = better margins)
• Premium locations near transit
• Elimination of holdout risk

Coordinating with Neighbours

Successful assemblies require:

• Early communication: Start conversations before listing
• Aligned expectations: Everyone must understand assembly value vs. individual value
• Professional representation: Use an experienced assembly broker or realtor
• Equitable pricing: Typically pro-rata based on lot size
• Coordinated timing: All properties must be available simultaneously

If one neighbour isn’t interested or demands unreasonable terms, assess whether the assembly still works without them—or whether to sell individually.

Part 8: Tax Implications

Selling to a developer triggers tax considerations that differ from typical home sales. Consult a tax professional for your specific situation—this section provides general information only.

Principal Residence Exemption (PRE)

If the property was solely your principal residence for every year you owned it, you may exempt the entire gain from capital gains tax.

Key requirements:

• You, your spouse, or common-law partner must have “ordinarily inhabited” the home
• Only one property per family unit can be designated as principal residence per year
• Since 2016, you must report the sale on your tax return even if fully exempt

Land size consideration: If your property exceeds 0.5 hectares (1.24 acres), only the portion necessary for residential use qualifies for PRE. The excess may be taxable.

Capital Gains Tax (If PRE Doesn’t Apply)

If PRE doesn’t fully apply (investment property, secondary residence, or partial exemption):

Capital Gain = Sale Price − Adjusted Cost Base − Selling Costs

Adjusted Cost Base includes:

• Original purchase price
• Land transfer tax paid at purchase
• Legal fees at purchase
• Capital improvements (renovations, additions—not repairs)

Selling costs include:

• Real estate commissions
• Legal fees at sale

Inclusion rate (as of June 25, 2024):

• First $250,000 of capital gains: 50% inclusion
• Capital gains above $250,000: 66.67% inclusion

Example: $1 million capital gain

• First $250K × 50% = $125K taxable income
• Remaining $750K × 66.67% = $500K taxable income
• Total taxable income: $625K
• Tax at marginal rate (varies by province and income level)

Flipping Rules (Properties Held Less Than 12 Months)

Since January 1, 2023, if you sell a residential property held for less than 12 months, the profit is deemed business income (100% taxable) rather than capital gains, and PRE doesn’t apply.

Exceptions exist for life events (death, disability, separation, job relocation, etc.), but this rule makes short-term speculative selling far less attractive.

GST/HST Considerations

Selling a used residential property to a developer generally doesn’t trigger GST/HST for the seller. However, developers may include clauses regarding GST/HST treatment—have your accountant review before signing.

Tax Planning Strategies

• Time the sale: If your income will be lower in a future year (retirement, sabbatical), waiting to sell could reduce your marginal tax rate
• Track capital improvements: Receipts for renovations increase your adjusted cost base and reduce taxable gains
• Consider partial sales: If you own land beyond residential use (large acreage), you may be able to subdivide and shelter part under PRE
• Spousal income splitting: In some cases, joint ownership structures can optimize tax treatment

Critical advice: Engage a real estate tax accountant before signing a purchase contract. Tax planning options may be limited once the sale is agreed.

Part 9: The Sale Process Step-by-Step

Here’s what to expect from initial decision through closing.

Phase 1: Preparation (2-4 weeks)

1. Assess your property’s potential

   • Confirm zoning and eligible unit count
   • Identify site advantages and constraints
   • Gather documents (title, survey, assessment)

2. Engage professionals

   • Realtor with developer transaction experience
   • Tax accountant for planning
   • Real estate lawyer (identify early, engage at offer stage)

3. Determine pricing strategy

   • Obtain residual land value analysis
   • Compare to recent development site sales
   • Decide on listing price vs. offer date strategy

Phase 2: Marketing (2-6 weeks)

1. List the property

   • MLS listing emphasizing development potential
   • Targeted outreach to developer buyers
   • Off-market networking through broker relationships

2. Manage showings

   • Developers will walk the site, measure, photograph
   • Provide access to documents and information
   • Answer questions promptly to maintain momentum

3. Collect offers

   • Review with your realtor and lawyer
   • Assess price, terms, subject clauses, deposits, timeline
   • Prepare counter-offers if appropriate

Phase 3: Negotiation and Contract (1-2 weeks)

1. Negotiate terms

   • Price and deposit structure
   • Subject clauses and due diligence period
   • Closing timeline
   • Special conditions (holdbacks, price adjustments—avoid if possible)

2. Execute contract

   • Both parties sign
   • Initial deposit delivered to trust
   • Due diligence period begins

Phase 4: Due Diligence (30-90 days typically)

During this period, the developer will:

• Conduct detailed site analysis
• Engage architects for preliminary design
• Obtain construction cost estimates
• Arrange financing
• Review title, survey, and legal documents
• Possibly conduct environmental assessment

Your role:

• Provide access for inspections and surveys
• Respond promptly to information requests
• Monitor for deadline compliance
• Prepare for subject removal or negotiation

Phase 5: Subject Removal

If the developer is satisfied, they’ll remove subjects and deliver additional deposit. The contract becomes firm.

If they request extensions or renegotiation:

• Evaluate whether the request is reasonable
• Consider whether to agree, counter-offer, or terminate
• Be prepared to return to market if terms become unacceptable

Phase 6: Pre-Closing (closing date minus 30 days to closing)

• Engage your lawyer to prepare for closing
• Clear any title issues (mortgages, liens)
• Arrange for possession (moving, tenant notice if applicable)
• Confirm closing funds flow
• Review final closing documents

Phase 7: Closing

On the completion date:

• Title transfers to the developer
• Sale proceeds (less mortgages, fees, adjustments) are released
• Keys/possession transferred (often same day, sometimes different)
• Your lawyer will provide final statement of adjustments

Part 10: Common Mistakes to Avoid

Mistake 1: Accepting the First Offer

Developers who approach homeowners directly are often seeking uninformed sellers. Their first offer is rarely their best offer. Always generate competition or at least obtain an independent valuation before accepting.

Mistake 2: Undervaluing Development Potential

Comparing your property to recent single-family sales misses the development premium. A proper residual land value analysis could reveal your property is worth 20-50% more than comparable home sales suggest.

Mistake 3: Overly Aggressive Pricing

The flip side—pricing based on theoretical maximum residual value ignores developer risk, profit requirements, and market conditions. Overpriced properties sit on market, become stale, and eventually sell for less than properly priced properties would have achieved.

Mistake 4: Inadequate Deposits

Standard residential deposits (5%) are insufficient for development transactions with extended closings. If a developer walks away 6 months into an 18-month closing, you’ve lost significant time and market position. Negotiate deposits of 15-25% with non-refundable portions.

Mistake 5: Unlimited Subject Clauses

“Subject to satisfactory due diligence” with no specificity is essentially a free option for the developer. Push for defined criteria—what specific issues would cause them to exit?

Mistake 6: Ignoring Tax Implications

A surprise tax bill can consume a significant portion of your premium. Engage a tax accountant before signing contracts to understand your exposure and optimize timing.

Mistake 7: Going It Alone

Developer transactions are complex. An experienced realtor with developer relationships can:

• Identify buyers you’d never reach
• Generate competition
• Negotiate better terms
• Identify red flags in contracts
• Coordinate the process

Their commission is typically more than offset by improved outcomes.

Key Takeaways

• One-third of Vancouver land purchases are now for multiplex development—your property may be worth significantly more than residential comparables suggest
• Developers use residual land value analysis, not comparable sales—understand this method to negotiate effectively
• R1-1 zoning allows 3-6 strata units (up to 8 rental) depending on lot size, with 1.0 FSR potential
• Extended due diligence (30-90 days) and closing timelines (6-18 months) require higher deposits and stronger protections
• Land assembly can add 20-50% value but requires neighbour coordination and isn’t available for multiplex-only projects
• Tax implications vary significantly—principal residence exemption may apply but requires proper reporting
• Professional representation (realtor, lawyer, accountant) typically pays for itself through better outcomes

Frequently Asked Questions

How much more can I get selling to a developer vs. a regular buyer?

Depending on lot size, location, and development potential, the premium typically ranges from 20-50% above residential value. A property worth $2.2 million to a homebuyer might sell for $2.8-3.3 million to a developer. The premium is highest for larger lots in desirable neighbourhoods with strong end-unit pricing.

How long does selling to a developer take?

From listing to closing, expect 6-18 months total. Marketing and negotiation: 1-3 months. Due diligence: 1-3 months. Closing period: 3-12 months (depending on developer needs). Longer timelines are common when developers coordinate with permit applications or construction financing.

Should I wait for a developer to approach me?

No. Developers who cold-call are typically looking for uninformed sellers and will offer below market value. Proactive marketing generates competition and better outcomes. If a developer approaches you unsolicited, treat their offer as a starting point, not a final number.

What if my neighbours want to do a land assembly but I don’t?

You’re under no obligation to participate. If you prefer to sell individually, you can do so—your property has value as a single multiplex site. However, consider whether assembly pricing is materially better before deciding. An experienced broker can help you evaluate both options.

Do I need to move out before closing?

You need to deliver vacant possession by the closing date. Plan your move around this timeline. If you have tenants, understand your obligations under BC’s Residential Tenancy Act—developers will require vacant possession and the legal process takes time.

What happens if the developer backs out after subject removal?

If subjects have been removed and the contract is firm, you’re entitled to keep the deposit and may have additional legal remedies. This is why deposit amounts and structure matter—a 20% non-refundable deposit creates real consequences for developer default.

Ready to Explore Your Options?

If you’re a Vancouver homeowner considering selling to a developer, understanding your property’s true development value is the essential first step.

I provide complimentary consultations for homeowners exploring developer sales. We’ll review your property’s multiplex potential, estimate residual land value, and discuss the process—no obligation, just clarity on your options.

With almost 20 years of Vancouver real estate experience and deep relationships with active multiplex developers, I can help you navigate this transaction and maximize your outcome.

Contact Greyden Douglas directly at (604) 218-2289 or book a call to discuss your Vancouver real estate goals.