{"id":17231,"date":"2023-02-06T01:21:29","date_gmt":"2023-02-06T01:21:29","guid":{"rendered":"https:\/\/hypotheques.ca\/staging\/blogue\/le-point-sur-la-nouvelle-loi-visant-a-interdire-les-investissements-etrangers-dans-le-logement-au-canada\/"},"modified":"2023-07-18T15:43:31","modified_gmt":"2023-07-18T15:43:31","slug":"update-on-the-new-act-to-prohibit-foreign-investment-in-housing-in-canada","status":"publish","type":"post","link":"https:\/\/hypotheques.ca\/staging\/en\/blog\/update-on-the-new-act-to-prohibit-foreign-investment-in-housing-in-canada\/","title":{"rendered":"Update on the new Act to prohibit foreign investment in housing in Canada"},"content":{"rendered":"\t\t<div data-elementor-type=\"wp-post\" data-elementor-id=\"17231\" class=\"elementor elementor-17231 elementor-1320\" data-elementor-post-type=\"post\">\n\t\t\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-57f4eb59 elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"57f4eb59\" data-element_type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-390a48b0\" data-id=\"390a48b0\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-38e8dc39 elementor-widget elementor-widget-text-editor\" data-id=\"38e8dc39\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<p><span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/hypotheques.ca\/staging\/en\/blogue\/importante-modifications-a-la-loi-sur-linterdiction-dachat-dimmeubles-residentiels-par-des-non-canadiens\/\"><span style=\"font-weight: bold;\">IMPORTANT UPDATE (MARCH 28, 2023)<\/span><\/a><\/span><\/p><p><span style=\"color: #ff0000;\"><a style=\"color: #ff0000; letter-spacing: var(--the7-base-letter-spacing); text-transform: var(--the7-base-text-transform); word-spacing: normal; background-color: var( --e-global-color-el_color_0 );\" href=\"https:\/\/hypotheques.ca\/staging\/en\/blogue\/importante-modifications-a-la-loi-sur-linterdiction-dachat-dimmeubles-residentiels-par-des-non-canadiens\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: bold;\">Click here to get the latest information<\/span><\/a><\/span><\/p><p id=\"\">In the last few weeks, there has been a lot of information about the new law that will come into effect on January 1, 2023, which will\u00a0<a id=\"\" href=\"https:\/\/hypotheques.ca\/staging\/en\/blogue\/interdiction-dachat-de-maison-canada-non-canadien\">prohibit foreign investment in real estate<\/a>.<\/p><p id=\"\">Our mortgage brokers will explain in detail the conditions under which this prohibition applies.<\/p><p id=\"\"><span id=\"\" style=\"font-weight: bold;\">there is a great deal of uncertainty since the exception is conditional on a non-existent regulation.<\/span><\/p><h2 id=\"\" style=\"margin-bottom: var(--the7-h2-spacing); color: #0a2051; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; text-transform: none; letter-spacing: normal; word-spacing: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial;\">What does the law aim at?<\/h2><p id=\"\">The\u00a0<span id=\"\" style=\"font-weight: bold;\">Non-Canadian Residential Property Purchase Prohibition Act<\/span>\u00a0is intended to temporarily prohibit a large number of foreigners and foreign companies from purchasing residential properties in Canada for a period of\u00a0<span id=\"\" style=\"font-weight: bold;\">2 years<\/span>\u00a0starting\u00a0<span id=\"\" style=\"font-weight: bold;\">January 1, 2023<\/span>.<\/p><h2 id=\"\" style=\"margin-bottom: var(--the7-h2-spacing); color: #0a2051; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; text-transform: none; letter-spacing: normal; word-spacing: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial;\">Who is affected by this ban?<\/h2><p id=\"\">Under section 4(1) of the Act, &#8220;<em id=\"\">notwithstanding section 34 of the Citizenship Act, no non-Canadian shall purchase, directly or indirectly, any residential property<\/em>.<\/p><p id=\"\">The law defines &#8220;<span id=\"\" style=\"font-weight: bold;\">non-Canadian<\/span>&#8221; in its second section:<\/p><p id=\"\">&#8220;(<em id=\"\">a) An individual other than a Canadian citizen, a person registered as an Indian under the Indian Act or a permanent resident<\/em><\/p><p id=\"\"><em id=\"\">(b) a corporation incorporated otherwise than by an Act of Parliament or of a province;<\/em><\/p><p id=\"\"><em id=\"\">(c) a federally or provincially incorporated corporation whose shares are not listed on a designated stock exchange under section 262 of the Income Tax Act and which is controlled by a person referred to in paragraph (a) or (b);<\/em><\/p><p id=\"\"><em id=\"\">(d) a prescribed person or entity.(non-Canadian)<\/em>.&#8221;<\/p><p id=\"\">Thus, is considered as non-Canadian any person:<\/p><ul id=\"\"><li id=\"\">not being a Canadian citizen<\/li><li id=\"\">not being Aboriginal<\/li><li id=\"\">being a corporation incorporated under a law other than federal or provincial law<\/li><li id=\"\">being a federally or provincially incorporated company that is not publicly traded<\/li><\/ul><figure id=\"\" class=\"w-richtext-figure-type-image w-richtext-align-fullwidth\" style=\"max-width: 720px;\" data-rt-type=\"image\" data-rt-align=\"fullwidth\" data-rt-max-width=\"720px\"><div id=\"\"><img decoding=\"async\" id=\"\" src=\"https:\/\/hypotheques.ca\/staging\/wp-content\/uploads\/2023\/03\/633dd32b9811a20b1ab99216_nouvelle-loi-interdiction-achat-maison-non-canqdien.jpg\" alt=\"new law prohibiting the purchase of non-Canadian homes\" width=\"auto\" height=\"auto\" \/><\/div><\/figure><p id=\"\">However, this law sets out several\u00a0<span id=\"\" style=\"font-weight: bold;\">exceptions\u00a0<\/span>in its second paragraph:<\/p><p id=\"\">&#8221;\u00a0<em id=\"\">Subsection (1) does not apply to the following persons:<\/em><\/p><p id=\"\"><em id=\"\">(a) a temporary resident, as defined in the Immigration and Refugee Protection Act, who meets the requirements of a future regulation\u00a0<\/em><span id=\"\" style=\"font-weight: bold;\"><em id=\"\">(Section 4 (2)<\/em><\/span><em id=\"\">\u00a0(expected in December 2022)<\/em><\/p><p id=\"\"><span id=\"\" style=\"font-weight: bold;\">(i.e. work permit, PVT, Young Professionals &#8230;)<\/span><\/p><p id=\"\"><em id=\"\">(b) a protected person, as defined in subsection 95 (2) of that Act;<\/em><\/p><p id=\"\"><em id=\"\">(c) an individual who is a non-Canadian and who purchases residential real property with his or her spouse or common-law partner, if the spouse or common-law partner is a Canadian citizen, a person registered as an Indian under the Indian Act, a permanent resident or a person referred to in paragraph (a) or (b);<\/em><\/p><p id=\"\"><em id=\"\">(d) the person is a member of a prescribed class of persons<\/em>.<\/p><p id=\"\"><span id=\"\" style=\"font-weight: bold;\">In summary:<\/span><\/p><p id=\"\">As of January 1, 2023, non-Canadian foreigners will not be able to purchase real estate for a period of 2 years.<\/p><p id=\"\"><span id=\"\" style=\"font-weight: bold;\">Exemptions to the prohibition:<\/span>The exemptions to the prohibition described in the regulation include:<\/p><ul id=\"\"><li id=\"\">Permanent residents.<\/li><li id=\"\">Non-Canadians who purchase residential property with their spouse or common-law partner, provided the spouse or common-law partner is eligible to purchase residential property in Canada.<\/li><li id=\"\">Refugees.<\/li><li id=\"\">Temporary residents who:<\/li><li id=\"\">Are enrolled in an authorized program of study at a designated educational institution and :<\/li><li id=\"\">The purchase price of the property does not exceed $500,000.<\/li><li id=\"\">They have filed tax returns in Canada for the five years preceding the year of purchase.<\/li><li id=\"\">Have been physically present in Canada for at least 244 days in each of the five calendar years preceding the purchase.<\/li><li id=\"\">Have not purchased more than one residential property.<\/li><li id=\"\">Hold a work permit or are authorized to work in Canada and :<\/li><li id=\"\">Worked full-time in Canada for at least three years in the four years preceding the year of purchase.<\/li><li id=\"\">Have filed all required tax returns for at least three of the four tax years prior to the year of purchase.<\/li><li id=\"\">Have not purchased more than one residential property.<\/li><li id=\"\">Foreigners who hold a passport containing a valid acceptance as a diplomat, consular officer, civil servant or special representative issued by the Chief of Protocol of the Ministry of Foreign Affairs, Trade and Development.<\/li><li id=\"\">Acquisition of an interest or right in rem as a result of death, divorce, separation or gift.<\/li><li id=\"\">A lease of a dwelling to a tenant for the purpose of occupancy by the tenant.<\/li><li id=\"\">Transfer\u00a0under a trust that was created before the Act came into force.<\/li><li id=\"\">A\u00a0transfer\u00a0resulting from the exercise of a security interest or a right secured by a secured\u00a0creditor.<\/li><\/ul><ul id=\"\"><li id=\"\"><span id=\"\" style=\"font-weight: bold;\">foreign students in the process of obtaining permanent residence\u00a0<\/span><\/li><\/ul><p id=\"\">With respect to purchase and sale agreements signed before January 1, 2023, these may be entered into after the implementation of the Prohibition Act.<\/p><p id=\"\"><span id=\"\" style=\"font-weight: bold;\">For the moment, in substance, the law provides that foreigners will not be able to buy except for temporary residents, if and only if they meet the conditions of a regulation that does not yet exist (Article 4 (2)<\/span>! Regulation in Article 8.<\/p><p id=\"\"><span id=\"\" style=\"font-weight: bold;\">there is a great deal of uncertainty since the exception is conditional on a non-existent regulation.<\/span><\/p><p id=\"\">\u200d<\/p><figure id=\"\" class=\"w-richtext-figure-type-image w-richtext-align-fullwidth\" style=\"max-width: 720px;\" data-rt-type=\"image\" data-rt-align=\"fullwidth\" data-rt-max-width=\"720px\"><div id=\"\"><img decoding=\"async\" id=\"\" src=\"https:\/\/hypotheques.ca\/staging\/wp-content\/uploads\/2023\/03\/633dd1f2df50f8bc2d88db02_acheter-maison-non-canadien.jpg\" alt=\"purchase of a non-Canadian home\" width=\"auto\" height=\"auto\" \/><\/div><\/figure><h2 id=\"\" style=\"margin-bottom: var(--the7-h2-spacing); color: #0a2051; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; text-transform: none; letter-spacing: normal; word-spacing: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial;\">What is the point of this ban?<\/h2><p id=\"\">The intention of the legislator with this prohibition is to reduce foreign funds entering the Canadian real estate market. Thus, this law would allow to mitigate the inflation currently experienced on the Canadian market.<\/p><h2 id=\"\" style=\"margin-bottom: var(--the7-h2-spacing); color: #0a2051; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; text-transform: none; letter-spacing: normal; word-spacing: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial;\">What types of buildings are covered by this ban?<\/h2><p id=\"\">This prohibition applies to any residential building located in Canada, namely:<\/p><p id=\"\">&#8220;<em id=\"\">(a) a detached house or similar building\u00a0<\/em><span id=\"\" style=\"font-weight: bold;\"><em id=\"\">consisting of not more than three dwelling units<\/em><\/span><em id=\"\">(a) a single-family dwelling or similar building, comprising not more than three dwelling units, including that proportion of the outbuildings and land underlying or adjoining the building that is reasonably necessary for its residential use;<\/em><\/p><p id=\"\"><em id=\"\">(b) a portion of a building that constitutes a semi-detached or row house, condominium unit or similar premises that is, or is intended to be, a separate parcel or other division of real property or immovable over which there is, or is intended to be a property interest separate and apart from the property interests in the other parts of the building, including that proportion of the common areas and appurtenances of the building, and of the land underlying or contiguous thereto, that is attributable to the house, dwelling unit or premises and is reasonably necessary for its residential use<\/em><\/p><p id=\"\"><em id=\"\">(c) a prescribed real property or immovable<\/em>.<\/p><p id=\"\">In summary, the ban includes:<\/p><ul id=\"\"><li id=\"\"><span id=\"\" style=\"font-weight: bold;\">detached<\/span>\u00a0or similar one- to three-unit detached houses<\/li><li id=\"\"><span id=\"\" style=\"font-weight: bold;\">semi-detached houses<\/span><\/li><li id=\"\"><span id=\"\" style=\"font-weight: bold;\">condominiums<\/span><\/li><li id=\"\"><span id=\"\" style=\"font-weight: bold;\">vacant land<\/span>\u00a0where the land has been selected for residential or mixed use and is located in a metropolitan area or census agglomeration<\/li><\/ul><p id=\"\">However, the government wishes to exclude from this ban:<\/p><ul id=\"\"><li id=\"\"><span id=\"\" style=\"font-weight: bold;\">second homes<\/span><\/li><li id=\"\"><span id=\"\" style=\"font-weight: bold;\">residential properties located outside a metropolitan area or census agglomeration<\/span>.<\/li><\/ul><figure id=\"\" class=\"w-richtext-figure-type-image w-richtext-align-fullwidth\" style=\"max-width: 720px;\" data-rt-type=\"image\" data-rt-align=\"fullwidth\" data-rt-max-width=\"720px\"><div id=\"\"><img decoding=\"async\" id=\"\" src=\"https:\/\/hypotheques.ca\/staging\/wp-content\/uploads\/2023\/03\/633dd19133b45e9ebe12be9b_sanctions-interdiction-achat-immobilier-non-canadien.jpg\" alt=\"penalties for non-Canadian home purchases \" width=\"auto\" height=\"auto\" \/><\/div><\/figure><h2 id=\"\" style=\"margin-bottom: var(--the7-h2-spacing); color: #0a2051; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; text-transform: none; letter-spacing: normal; word-spacing: 0px; text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial;\">What are the penalties for not complying with this ban?<\/h2><p id=\"\">If you decide not to comply with this prohibition, you will be faced with :<\/p><ul id=\"\"><li id=\"\">penalties\u00a0applicable to the non-Canadian and any person or entity that assisted the non-Canadian in circumventing this prohibition,<\/li><li id=\"\">a fine of\u00a0<span id=\"\" style=\"font-weight: bold;\">$10,000<\/span>\u00a0for the non-Canadian and any person or entity that assisted in circumventing this law,<\/li><li id=\"\">a court order of sale in the event of a conviction,<\/li><li id=\"\">not to collect an amount greater than the original purchase price of the residential property in the event of any judicial sale ordered by the provincial court.all texts are available here :<\/li><\/ul><p id=\"\"><span id=\"\" style=\"font-size: 12px; line-height: 0; position: relative; vertical-align: baseline; bottom: -0.25em;\">\u200d<\/span><a id=\"\" href=\"https:\/\/lois-laws.justice.gc.ca\/PDF\/P-25.2.pdf\"><span id=\"\" style=\"font-size: 12px; line-height: 0; position: relative; vertical-align: baseline; bottom: -0.25em;\">An Act to prohibit the purchase of residential real estate by non-Canadians<\/span><\/a><a id=\"\" href=\"https:\/\/www.canada.ca\/fr\/immigration-refugies-citoyennete\/organisation\/publications-guides\/bulletins-guides-operationnels\/residents-temporaires\/termes-definitions.html\"><span id=\"\" style=\"font-size: 12px; line-height: 0; position: relative; vertical-align: baseline; bottom: -0.25em;\">\u200d<\/span><\/a><\/p><p id=\"\"><a id=\"\" href=\"https:\/\/www.canada.ca\/fr\/immigration-refugies-citoyennete\/organisation\/publications-guides\/bulletins-guides-operationnels\/residents-temporaires\/termes-definitions.html\"><span id=\"\" style=\"font-size: 12px; line-height: 0; position: relative; vertical-align: baseline; bottom: -0.25em;\">Terms and definitions related to temporary residents<\/span><\/a><\/p><p>Our brokers believe that this law is not adapted, especially for temporary residents who should have the possibility to settle in Canada with their family, temporary residents pay the same taxes as Canadians.<br \/><span id=\"\" style=\"font-weight: bold; background-color: var( --e-global-color-el_color_0 ); color: var(--the7-base-color); letter-spacing: var(--the7-base-letter-spacing); text-transform: var(--the7-base-text-transform); word-spacing: normal;\">We believe that skilled workers who settle in Canada should have the right to own property to live in and not for speculative purposes<\/span>.<\/p><p id=\"\">We invite you to sign<br \/><a href=\"https:\/\/www.change.org\/p\/le-1er-janvier-2023-la-loi-sur-l-interdiction-%C3%A0-l-achat-immobilier-par-les-non-canadiens-va-entrer-en-vigueur-que-signifie-cela-pour-les-acheteurs-ayant-le-statut-de-r%C3%A9sident-permanent-temporaire-%C3%A9tudiants?recruiter=893724573&amp;utm_source=share_petition&amp;utm_medium=sms&amp;utm_campaign=share_petition&amp;utm_term=share_petition&amp;recruited_by_id=44b811c0-9e7b-11e8-9fe2-050c3983f8a9\">this petition to challenge the law to prohibit the purchase of real estate by non-Canadians\u00a0<\/a>.<\/p><blockquote id=\"\" style=\"color: #0a2051; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; text-transform: none;\"><p>For any questions or additional information, we invite you to contact our team of\u00a0mortgage brokers\u00a0<a id=\"\" href=\"https:\/\/hypotheques.ca\/staging\/en\/equipe\">for an appointment<\/a>.<\/p><\/blockquote>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t\n    <div class=\"xs_social_share_widget xs_share_url after_content \t\tmain_content  wslu-style-1 wslu-share-box-shaped wslu-fill-colored wslu-none wslu-share-horizontal wslu-theme-font-no wslu-main_content\">\n\n\t\t\n        <ul>\n\t\t\t        <\/ul>\n    <\/div> \n","protected":false},"excerpt":{"rendered":"<p>On January 1, 2023, a new law will come into effect prohibiting foreign investment in housing in Canada. Who is affected by this ban? What types of housing are affected by this ban? What are the penalties for not respecting this ban? Our brokers will clarify the subject and give you their advice!<\/p>\n","protected":false},"author":4,"featured_media":16306,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"postBodyCss":"","postBodyMargin":[],"postBodyPadding":[],"postBodyBackground":{"backgroundType":"classic","gradient":""},"footnotes":""},"categories":[280],"tags":[],"class_list":["post-17231","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-buying-a-home"],"acf":[],"_links":{"self":[{"href":"https:\/\/hypotheques.ca\/staging\/en\/wp-json\/wp\/v2\/posts\/17231","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/hypotheques.ca\/staging\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/hypotheques.ca\/staging\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/hypotheques.ca\/staging\/en\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/hypotheques.ca\/staging\/en\/wp-json\/wp\/v2\/comments?post=17231"}],"version-history":[{"count":4,"href":"https:\/\/hypotheques.ca\/staging\/en\/wp-json\/wp\/v2\/posts\/17231\/revisions"}],"predecessor-version":[{"id":17818,"href":"https:\/\/hypotheques.ca\/staging\/en\/wp-json\/wp\/v2\/posts\/17231\/revisions\/17818"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/hypotheques.ca\/staging\/en\/wp-json\/wp\/v2\/media\/16306"}],"wp:attachment":[{"href":"https:\/\/hypotheques.ca\/staging\/en\/wp-json\/wp\/v2\/media?parent=17231"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/hypotheques.ca\/staging\/en\/wp-json\/wp\/v2\/categories?post=17231"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/hypotheques.ca\/staging\/en\/wp-json\/wp\/v2\/tags?post=17231"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}