According to the Prohibition on the Purchase of Residential Property by Non-Canadians Act, effective 1st January 2023, all non-Canadian individuals (not citizens or permanent residents) and corporations are banned from purchasing residential property in Canada until 1st January 2025 (next two years).
Why Has Canada Initiated A Foreign Buyer’s Ban?
The goal is to make residential real estate in Canada affordable again. Or at, least that’s the plan. According to Prime Minister Justin Trudeau’s party website, “The desirability of Canadian homes is attracting profiteers, wealthy corporations, and foreign investors. Homes are for people, not investors.” Despite its noble intentions, Canada’s Real Estate Association (CREA) believes that the anticipated regulations may be counter-productive.
Who Is Exempted From Canada’s Foreign Buyer’s Ban?
To start with, let’s get one thing straight: if you’re looking to rent a property as a foreigner, you’re good. This new act does not apply to you and there’s no ban on renting properties in Canada as a foreigner. Other ‘non-Canadians’ exempted from this ban are:
- Temporary residents studying at designated earning institutions (additional terms).
- Work permit holders or, if they are authorized to work in Canada under regulations laid down by Immigration and Refugee Protection Regulations (additional terms).
- Anyone who acquires a property as a result of unplanned circumstances like death, divorce, or gift.
- Any transfers that took place before the act came into effect i.e 1st January 2023.
- If your spouse or common-law partner is a Canadian Citizen.
- Members of indigenous communities who are registered members under the Indian Act.
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