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Stieg & Manning
Real Estate Team

FOREIGN BUYERS

Canada currently has a ban on foreign buyers of residential property, what does this mean for foreign buyers?

What does the foreign buyer ban mean?

In Canada there is currently a ban on foreign buyers of purchasing residential property. This ban came into place January 1, 2023 and was to expire January 1, 2025 but has been extended to January 1, 2027. The goal of the government in enacting this ban, was to cool the overheated real estate market and address housing affordability which was quickly getting out of control. Properties were being bought up by speculators and the aim was to restrict this, and allow locals to purchase in their communities without being priced out of the market and to stabilize the real estate market itself.

Purchasing a home in British Columbia as a foreign buyer involves navigating a complex landscape of legal requirements, taxes, and regulations. A real estate lawyer is critical to be able to understand all of the necessary information when purchasing as a foreign buyer.

Are there any exemptions to the Foreign Buyer Ban?

Canadian Citizens and Permanent Residents, are exempt

Protected Persons, as defined in the Immigration and Refugee Protection Act

Temporary Residents, international students and work permit holders may qualify under certain conditions

Refugees, individuals who have successfully claimed refugee protection in Canada

Diplomats & other individuals with immunity, under international agreements

Properties outside of Census Metropolitan Areas (CMA), are exempt

International Students, specific criteria must be met such as being enrolled in a recognized educational institution and studying in Canada for a minimum of 5 years

Spouses  or Common-law Partners, if the spouse or common-law partner is a Canadian citizen, permanent resident or protected person*


*A spouse or common-law partner may be considered exempt if they meet specific conditions. It is absolutely imperative to have advice from a real estate lawyer to make sure the conditions can be met. Even if a spouse or common-law partner meets the conditions for exception they may still be subject to the foreign buyer's tax. This again requires the advice of a real estate lawyer. 

To Do list for foreign buyers wanting to purchase in Canada

Hire a real estate lawyer, there are regulations and taxes to consider and understand when purchasing as a non-resident or foreign buyer, so a real estate lawyer is the first step. This is especially important during the Foreign Buyer Ban period and knowing if you qualify for an exemption

Open a Canadian bank account, foreign buyers need to open a Canadian bank account to handle financial transactions related to the property purchase, including down payments and mortgage payments 

Contact a mortgage broker, foreign buyers looking to obtain mortgage lending through Canadian banks may have stricter lending criteria and require higher down payments

Contact a Realtor, once you have the legal requirements handled by a real  estate lawyer and understand the lending process and your buying power, you are ready to find the perfect neighborhood and your dream home!

DISCLAIMER

The information provided is for general purposes only. It is not written nor intended to provide legal advice or opinions of any kind. No one should act upon, refrain from acting, based solely upon the information provided without first seeking appropriate legal and/or other professional advice.

MLS® property information is provided under copyright© by the Vancouver Island Real Estate Board and Victoria Real Estate Board. The information is from sources deemed reliable, but should not be relied upon without independent verification.