Can Foreigners and Temporary Residents Purchase Property?

The Prohibition on the Purchase of Residential Property by Non-Canadians Act, will be extended to January 1, 2027.

Housing costs have soared across Canada, prompting the introduction of this Act to help address the issue. It specifically targets foreign investors who purchase homes in Canada without actually residing in them.

The Prohibition on the Purchase of Residential Property by Non-Canadians Act, effective until 2027, restricts foreign investors who are not Canadian citizens or permanent residents from buying residential property. However, Canadian citizens and permanent residents are still free to purchase property as usual.

Properties like recreational properties, vacation homes and cottages are still allowed under the new law. The law also does not include homes that are outside of census metropolitan areas (cities with populations higher than 100,000).

If you hold a work permit (or are authorized to work in Canada under the Immigration and Refugee Protection Regulations), you are eligible to purchase residential property if you have 183 days or more of validity remaining on your work permit at the time of purchase, and you have not purchased more than one residential property in Canada.

Temporary residents, or those on a valid study or work permit, may still be able to purchase a home while the ban is in effect if they meet certain criteria.

Foreign Buyer’s Tax

Although this amendment allows for temporary residents to purchase Canadian property, those individuals in Ontario and British Columbia are subject to special provincial tax provisions.

The Non-Resident Speculation Tax (NRST), which is also referred to as the Foreign Buyer’s Tax, is a fee imposed on specific non-resident individuals when purchasing a property within any area of Ontario and designated regions of British Columbia. This tax, which is 25% in Ontario and 20% in British Columbia, is aimed to address the impact of foreign investment on local housing markets.

For more information visit the CANADIM Law Firm Website