Changes to Canada’s Foreign Homebuyers Ban – Here’s What You Need to Know
Changes to Canada’s Foreign Homebuyers Ban – On March 27th, the Honourable Ahmed Hussen, Minister of Housing and Diversity and Inclusion, announced amendments to the Prohibition on the Purchase of Residential Property by Non-Canadians Act’s accompanying Regulations.
The Act was passed by Parliament on June 23, 2022, and the Act and Regulations came into force on January 1, 2023, as part of the Government of Canada’s strategy to make housing more affordable for Canadians. The accompanying regulations were developed for the Act to set out specific exceptions, definitions, and clarifications necessary to implement the prohibition.
To enhance the flexibility of newcomers and businesses looking to add to Canada’s housing supply, the Government of Canada is making amendments to the Regulations, to expand exceptions to allow Non-Canadians to purchase a residential property in certain circumstances. These amendments will further support individuals and families seeking to build a life in Canada by pursuing home ownership in their communities sooner and address housing supply issues. These amendments come into force on March 27, 2023.
The following amendments are being announced by the Minister of Housing and Diversity and Inclusion:
Enable more work permit holders to purchase a home to live in while working in Canada.
The amendments will allow those who hold a work permit or are authorized to work in Canada under the Immigration and Refugee Protection Regulations to purchase residential property. Work permit holders are eligible if they have 183 days or more of validity remaining on their work permit or work authorization at the time of purchase, and they have not purchased more than one residential property. The current provisions on tax filings and previous work experience in Canada are being repealed.
Repealing existing provisions so the prohibition doesn’t apply to vacant land.
We are repealing section 3(2) of the regulations, so the prohibition does not apply to all lands zoned for residential and mixed-use. Vacant land zoned for residential and mixed-use can now be purchased by non-Canadians and used for any purpose by the purchaser, including residential development.
Exception for development purposes.
This exception allows non-Canadians to purchase residential property for the purpose of development. The amendments also extend the exception currently applicable to publicly traded corporations under the Act, to publicly traded entities formed under the laws of Canada or a province and controlled by a non-Canadian.
Increasing the corporation foreign control threshold from 3% to 10%.
For the purposes of the prohibition, with regards to privately held corporations or privately held entities formed under the laws of Canada or a province and controlled by a non-Canadian, the control threshold has increased from 3% to 10%. This aligns with the definition of ‘specified Canadian Corporation’ in the Underused Housing Tax Act.
To provide greater flexibility to newcomers and businesses seeking to contribute to Canada, the Government of Canada is making important amendments to the Act’s Regulations. These amendments will allow newcomers to put down roots in Canada through home ownership and businesses to create jobs and build homes by adding to the housing supply in Canadian cities. These amendments strike the right balance in ensuring that housing is used to house those living in Canada, rather than a speculative investment by foreign investors.
— The Hon. Ahmed Hussen, Minister of Housing and Diversity and Inclusion
Changes to Canada’s Foreign Homebuyers Ban – How to Buy in Canada
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