Buying a property in Canada as a foreigner comes with a few restrictions. They mainly refer to the type and purpose of acquisition. The most important one requires a foreign citizen to obtain temporary or permanent residency in Canada and complete the purchase.
Below, you can find out how to purchase a property in this country guided by our immigration lawyers in Canada, who can also provide support in relocation matters.
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Conditions under which foreigners can buy properties in Canada
The Prohibition on the Purchase of Residential Property by Non-Canadians Act is the main act covering the conditions under which foreigners can buy real estate in this country. According to it:
- no foreign investor who is not at least a temporary resident of Canada can purchase a residential property;
- foreign businesses operating in Canada as well as individuals who are not citizens or permanent residents are not allowed to purchase non-recreational residential land.
| Quick Facts | |
|---|---|
| Specific legislation applicable (YES/NO) | Prohibition on the Purchase of Residential Property by Non-Canadians Act. |
|
Possibility to acquire properties by foreigners |
Foreign citizens can acquire properties as long they hold one of the available forms of residency. |
|
Types of properties that can be purchased in Canada |
– detached and semi-detached houses, – rowhouses, – condominiums, – commercial buildings. |
| Real estate due diligence required (YES/NO) | No, however, we recommend it. |
| Documents to draft for property acquisition |
– valid passport (ID, residence permit), – social security number, – proof of income, – proof of good credit score, – sale-purchase agreement. |
| Financing availability (YES/NO) |
Yes, mortgages are available. |
| Special property acquisition programs for foreign citizens (YES/NO) |
No, there are no special programs, however, there are schemes that allow locals and foreigners to save money for this purpose. |
| Timeframe to acquire a property in Canada (approx.) |
Approx. 4 months. |
| Taxes to consider upon a property purchase |
– property/land transfer tax, – good and services tax, – harmonized sales tax. |
| Property registration requirement | Yes, with the Land Registry. |
| Best cities to buy properties in Canada |
Vancouver, Ottawa, Calgary, Ontario, Halifax, Montreal, etc. |
| Residency requirements for foreign citizens buying real estate |
Yes, at least temporary residency is required. |
| Possibility to appoint a Canadian representative during the transaction (YES/NO) |
Yes. |
| Property tax rates |
Rates vary depending on the province/territory the property is located in. |
| Support in buying a property in Canada (YES/NO) | Yes, you can rely on us for support in acquiring a property in Canada as a foreigner. |
Residential properties that can be purchased include:
- semi-detached houses;
- rowhouses;
- residential condominiums;
- detached houses or comparable structures.
Our immigration lawyer in Canada can advise on the regulations applicable to foreigners.
Can temporary residents buy properties in Canada?
The answer is yes, temporary residents can still acquire properties in Canada, as long as they are intended for residential use. In their case, the following conditions apply:
- they must have been physically present in Canada for at least 244 days in each of the 5 calendar years prior to the year in which the purchase was made;
- the purchase price of the residential property must not exceed CAD 500,000;
- they have not acquired more than one residential property;
- they have filed all required income tax returns under the Income Tax Act for each of the 5 taxation years preceding the year in which the purchase was made.
For those who migrate to Canada based on temporary work permits, the following conditions apply:
- if the employment is full-time as defined by paragraph 73(1) of the Immigration and Refugee Protection Regulations, they must have worked in Canada for a minimum of 3 years during the four years prior to the year the purchase was made;
- they have not bought more than one residential property;
- they have submitted all required income tax returns under the Income Tax Act for at least 3 of the 4 taxation years prior to the year the purchase was made.
Our Canada-based immigration law firm can offer the necessary support in moving to this country and understanding the requirements associated with buying a property here.
Here is also an infographic on the real estate purchase process in Canada:
Steps to purchase a property in Canada as a foreigner
The property purchase procedure for foreigners will be completed the same way as for locals and implies:
- choosing the province, the city, and the right property;
- make an offer and negotiate with the seller;
- gather the required documents;
- complete the transaction.
You should also consider if you need a mortgage, as this step will imply more time to complete the deal.
Foreign citizens can also obtain valuable information on property ownership from the Canadian Mortgage and Housing Corporation.
Here is also a video on real estate acquisition in Canada:
https://www.youtube.com/watch?v=iS35q8K3u6M
What is the best way to purchase a property in Canada?
While it is best to apply for permanent residency or citizenship in Canada before the acquisition, ultimately the decision is up to you, especially if you decide to remain in the country. However, if you decide to buy the property as a non-resident, you must consider the 20% foreign buyer tax.
If you want to immigrate to Canada from the United States and wonder if the same conditions apply to you, the answer is yes.
Feel free to contact us for support in moving and purchasing a property in Canada.
