Can foreign nationals buy property in Canada?

Table of contents:

Understanding the Canadian housing market

Before we dive into the specifics of buying a property in Canada and the regulations, let's take a look at the current state of the Canadian housing market. According to the Canadian Real Estate Association (CREA), the average price of a home in Canada is $659,395, up by 7.6% from January 2023, but lower than the spike it experienced in February 2022 at $816,720. The better performing markets being Toronto, Vancouver, and Montreal. Despite this improvement, home sales are still below the 10-year average.

Historically, the housing market in Canada has experienced fluctuations in both sales activity and prices. The year-over-year comparison for January 2024 reveals a 22% increase in home sales activity compared to January 2023.

Looking ahead to 2024, it's important to monitor how sales and price trends change and how they impact the Canadian housing market. By leveraging insights from historical data and monitoring key indicators you can make better predictions on when buying a property in Canada is the best time.

Who can buy property in Canada?

According to the prohibition on the purchase of residential property by non-Canadians regulations, only certain individuals and entities are allowed to purchase residential property in Canada. Non-Canadians, defined as individuals who are neither Canadian citizens nor permanent residents, face restrictions on buying property in Canada. However, there are exceptions outlined in the regulations for specific groups, including temporary residents studying or working in Canada, individuals going through significant life changes like divorce or death, and certain classes of foreign nationals such as diplomats or refugees.

Non-residents may encounter additional considerations and regulations depending on the province or territory in which they wish to buy property.

These considerations often include additional taxes, such as:

Additionally, foreign national buyers may need to seek approval from the Canadian government under the Foreign Investment Review Act (FIRA) in certain circumstances, particularly for large-scale property or sensitive industry purchases.

How to buy property in Canada

If you fall into one of the exempted categories or meet the prescribed conditions outlined in the regulations, you can explore the process of buying property in Canada.

This typically involves engaging with real estate agents, navigating legal documentation, and securing financing. 

While the regulations provide clarity on who can purchase property, the actual transactional process follows standard real estate practices, including property inspections, negotiations, and closing procedures.

Determine your eligibility

The first step in buying a property in Canada as a non-resident is to determine your eligibility. If you are allowed to purchase property in Canada, there are certain restrictions and requirements that must be met. These include:

Converting your currency to CAD the Easy way

So, you've found your dream property in Canada. Now, let's tackle the next step: converting your hard-earned cash into Canadian Dollars (CAD) so you can make that dream purchase.

Converting currency might sound daunting, but fear not! There are plenty of hassle-free options available to help you make the switch from your home currency to CAD.

One popular choice is using an international money transfer service like EasyFX. With EasyFX, you can convert currencies like Great British Pounds (GBP), United States Dollars (USD) or Euros (EUR) to Canadian Dollars (CAD) quickly and securely.

Plus, their currency exchange specialists are on hand to guide you through the process and ensure you get the best possible exchange rate.

So why wait? Speak to an expert today and start your Canadian property journey with confidence!

Consider the following:

Does buying a property in Canada give you residency?

One common misconception is that purchasing property in Canada automatically grants residency status. However, buying property alone does not guarantee residency or citizenship rights. Instead, individuals interested in obtaining residency or citizenship must follow the established immigration pathways and fulfil the required criteria set by Immigration, Refugees and Citizenship Canada (IRCC).

There are several programs and options available for those looking to obtain permanent residency in Canada.

Can international students buy property in Canada?

International students studying in Canada may also be interested in buying a property during their time in the country. The good news is that as an international student, you may be eligible to purchase residential property in Canada under certain conditions.

Taxes and fees associated with buying Canadian property

When buying a property in Canada, it's important to be aware of the taxes and fees that may apply. These can include:

It's important to consult with a tax professional to understand your tax obligations as a non-resident property owner in Canada.

How to sell property in Canada

Selling property in Canada as a non-resident follows established procedures similar to those for Canadian citizens and permanent residents. As a non-Canadian seller, you'll need to comply with legal requirements, including property disclosure regulations and tax obligations. Working with a real estate professional familiar with the intricacies of selling property in Canada can streamline the process and ensure compliance with all relevant laws and regulations.

Summary of buying property in Canada as a foreign national

In conclusion, understanding the ins and outs of buying property in Canada as a non-Canadian can seem like navigating a maze, but with the right information and guidance, it's possible. Remember, these regulations are in place to ensure fairness in the housing market and to protect the interests of both residents and non-residents alike. So, if you're dreaming of owning a piece of Canadian real estate, don't let the rules deter you - just make sure you understand them before diving in.

And here's a pro tip: when you're ready to make that purchase or sale, consider partnering with a trusted currency provider like EasyFX to help you navigate currency fluctuations and avoid hefty international transfer fees. It's a small step that can make a big difference in ensuring a smooth and cost-effective transaction. So, armed with knowledge and the right resources, you're well on your way to making your Canadian property ownership dreams a reality!