A Foreign Buyer will face an array of different obstacles in Canada. Here are a few hurdles that a Foreign Buyer will face:
- The Foreign Buyer Ban
- Foreign Buyer Tax
- BC Government’s Speculation and Vacancy Tax Act
Non-Canadian residents should discuss these bans and taxes with professionals prior to purchasing real estate in Canada. Today, we will discuss the Foreign Buyers Ban.
Foreign Buyers Ban (4 Years)
- As of January 1, 2023 the federal government enacted a Canada-wide, two-year foreign buyers ban on the purchase of residential real estate.
- The federal government has officially announced that they will be expanding the ban for another two-years, to 2027.
- The Act defines residential property as buildings with 3 dwelling units or less including semi-detached housing and condo units.
- The Act doesn’t ban the purchase of large buildings with 4 or more units.
- Non-Canadians can purchase residential properties that are located outside of Census Metropolitan Areas and Census Agglomerations (CA).
- A non-Canadian, or anyone who assists a non-Canadian, is at risk of conviction for violating the prohibition. In these cases, they will have to pay a fine of up to $10,000. Additionally, a court can order the sale of the residential property.
- The prohibition doesn’t apply to lands zoned for residential and mixed use.
- Vacant land zoned for residential and mixed use can now be bought by non-Canadians and used for any purpose by the buyer, including residential development.
- This exception allows non-Canadians to buy residential property for the purpose of development.
- For privately held Canadian corporations or entities controlled by a non-Canadian, the control threshold has increased to 10 per cent from three per cent.
The Act and Regulations provide exceptions:
Temporary residents studying in Canada
- enrolled in a program of authorized study at a designated learning institution
- filed income tax returns for each of the 5 taxation years preceding the year in which the purchase was made
- been physically present in Canada for a minimum of 244 days in each of the 5 calendar years preceding the year in which the purchase was made
- have not previously purchased a residential property in Canada while the prohibition is in effect
- purchase a property for a price not exceeding $500,000
Temporary residents working in Canada
- hold a valid work permit or are authorized to work in Canada
- have 183 days or more of validity remaining on their work permit or work authorization at time of purchase
- have not previously purchased a residential property in Canada while the prohibition is in effect
Refugees
- have been given refugee protection or
- are a protected person under the Immigration and Refugee Protection Act
Refugee claimants and individuals fleeing international crises
- have made a claim for refugee protection in accordance with the Immigration and Refugee Protection Act
- have received temporary resident status in accordance with the Immigration and Refugee Protection Act
Accredited members of foreign missions in Canada
- hold a passport that has a valid diplomatic, consular, official, or special representative acceptance issued by the Chief of Protocol of Canada
Non-Canadians spouses and common-law partners
- purchase residential property in Canada with their spouse or common-law partner who is a Canadian citizen, a person registered under the Indian Act, a permanent resident or a non-Canadian for whom the prohibition does not apply.
Exemptions for Census Metro Areas and Census Agglomerations
The Regulations include an exception for any residential property found outside of a CMA or CA as identified in Statistics Canada’s Standard Geographical Classification 2021.
Both CMAs and CAs are formed by one or more adjacent municipalities centered on a population center or core.
A CMA must have a total population of at least 100,000 of which 50,000 or more must live in the core. A CA must have a core population of at least 10,000.
For more info on exempt areas visit:
Census Metropolitan Area and Census Agglomeration Guidance Tool (arcgis.com)
Learn more by visiting these links:
Prohibition on the Purchase of Residential Property by Non-Canadians Act | CMHC (cmhc-schl.gc.ca)
Census Metropolitan Area and Census Agglomeration Guidance Tool (arcgis.com)
Prohibition on the Purchase of Residential Property by Non-Canadians Regulations (cmhc-schl.gc.ca)
Canada amends foreign buyer ban regulations (rebgv.org)
Foreign buyer ban extended in Canada to 2027 | CTV News
_
Speaking to a professional if you are a non-Canadian resident is essential. Please always verify the accuracy of this information through your own due diligence. Nicole McWilliams will assume no responsibility or liability for the accuracy of the information within.
I would love to be your Real Estate Agent of Choice!
EVERYONE needs a home to live in. As a result, I continue to be confident in the Canadian Real Estate Market. I recommend taking a peek at our current listings on the market.
Do not hesitate to contact me directly by email or phone to discuss all your real estate needs!
If you’re looking to purchase a home and are wanting a realtor to represent you, call or text 250.808.3125 or email nicolemcwilliamsproperties@gmail.com. You can also find out more about your real estate journey on my website nmcrealestate.ca.
