Buying a home in Canada as non-Canadians: Who is eligible?
The Canadian parliament passed the act of Prohibition on the Purchase of Residential Property by the Non-Canadians Act in July 2022, which came into effect on 1 January 2023.
According to the new act, foreign investors will not be able to buy any kind of residential property in Canada. Only Canadian citizens and permanent residents are allowed to buy residential properties.
These regulations or restrictions on purchasing residential property will last two years and then be automatically cancelled.
This act was mainly to reduce the housing prices in Canada and make them affordable. In recent years housing prices in Canada were escalated.
But the new property Act still has some exemptions for foreign investors. They can purchase recreational properties such as cottages and vacation homes. Also the Properties with more than three separate units are also an exemption.
The new Act also don’t include the homes that are outside census metropolitan areas (cities with populations higher than 100,000).
Also, the foreigners with a Canadian spouse can buy the home. They can later inherit the property in a transitional situation, such as a divorce or death of the spouse.
Temorary residents with a valid study or work permit can also buy a home in Canada after fulfilling the several conditions by the government.
On study permit they need to provide the proof for one of the following:
- Proof of income tax returns filing under the Income Tax Act for each taxation year upto five years prior the year in which the purchase was made.
- Proof of physical presence in Canada for a minimum of 244 days in past five years prior the year in which the purchase was made.
- Proof that the price of the residential property does not exceed $500,000.
- Proof that they have not purchased more than one residential property
On work permit they need to provide the proof for the following:
- Proof of full time work in Canada for a minimum period of three years within the last four years prior the year in which the purchase was made.
- Proof of filing the income tax returns under the Income Tax Act for a minimum of three of the four taxation years prior the year in which the purchase was made.
- Proof that they have not purchased more than one residential property.
