Purchase of a property in Canada by a Temporary Resident in Canada
On March 27, 2023, the Minister of Housing, Diversity and Inclusion announced significant changes to the regulation of the law prohibiting the purchase of residential property by non-Canadians. This law has been a major constraint on home ownership by temporary residents. (Work permit, PVT, Young Professionals…)
The easing allows temporary residents to become homeowners, the down payment required is unchanged, either 5 or 10% depending on your history in Canada (See our article)
We believe that this amendment will allow temporary residents to establish themselves permanently in Canada.
This law was passed by the parliament on June 23, 2022 and came into force on January 1, 2023. Its implementing regulation had been developed for the law to set out the exceptions. The Minister makes on March 27, 2023 an amendment to the definition and clarifications to the implementation of the law.
To increase flexibility for newcomers and businesses working to increase the supply of available housing, the federal government is making changes and exceptions for those seeking to settle in Canada. This will allow families looking to settle permanently to quickly access home ownership.
These amendments are effective immediately (March 27, 2023)
Here are the main changes announced by the Minister of Housing and Diversity and Inclusion:
Allow more temporary residents (work permits…) to purchase a home to live in while working in Canada.
Persons who have a work permit or are authorized to work in Canada will be allowed to purchase residential property.
To be eligible, these individuals must meet the following criteria:
- Have a work permit or work authorization that is valid for 183 days or more from the date of purchase(date of signature at the notary’s office).
- Do not own any other residential property, It is therefore necessarily a first purchase in Canada, The current provisions on tax returns and previous work experience in Canada are repealed.
- The provision of the Act relating to vacant land is repealed so that the prohibition does not apply to vacant land.
Subsection 3(2) of the by-law is repealed so that the prohibition does not apply to all land zoned for residential or mixed use. The amendments will allow non-Canadians to purchase vacant land zoned for residential or mixed use and use it for any purpose, including residential development.
Minister’s quote:
“In order to increase the flexibility of newcomers and businesses looking to contribute to the betterment of Canada, the federal government is making important changes to the regulations under the Act. These changes will allow newcomers to settle in Canada through home ownership. They will also allow businesses to create jobs and build housing, thereby increasing the supply of housing in Canadian cities. In this way, the right balance is struck by ensuring that housing is used as a home for people living in Canada rather than as a speculative investment for foreign investors.”
