March 27, 2023 - The federal government announced amendments to the Prohibition on the Purchase of Residential Property by Non-Canadians Act's regulations that came into force Jan 1, 2023.

Here's what you need to know:

Purchasing for the Purpose of Development

The new exception allows non-Canadians to purchase residential property, if the purpose is for development. Previously, this exception was applicable only to publicly-traded corporations. Keep in mind, the purpose of development does not include managing it as a rental property as part of a portfolio. Repairs, remodeling or renovation also do not count as development f a property.

Vacant Land Is Exempt

The Ban No Longer Applies to Vacant Land - vacant land zoned for residential use or mixed-use with residential can now be purchased by non-Canadians.

Work Permit Holders Can Now Purchase a Home

Now, those holding a work permit or who are authorized to work in Canada are allowed to purchase one residential property, as long as they have 183 days of validity or more remaining on their contract.

Corporation Foreign Control Threshold Is Increased

Originally the foreign buyer ban deemed a foreign entity as one where non-Canadians owned 3% or more of it. Now, this threshold has increased to 10%.

The original law which bans foreign buyers from purchasing residential real estate until 2025, was supposed to ease pressure in hot housing markets and make it easier for Canadians to acquire homes by stopping competition from outside of the country.  The foreign buyer ban also affected foreign buyers who were moving to the country to work but did not yet have permanent residency. After almost three months in affect, the government has adjusted the wording after the real estate industry complained the law had the effect of of halting deals and developments designed to bring more inventory to market.

In the three short months since this law came into effect, we've advised our non-Canadian clients to lean heavily on the advice of their legal representation when considering a purchase in Canada. These new amendments have been designed to provide some relief to developers and foreign workers.

If you have any questions, please give Darcy Nyrose and the team at Nyrose & Associates a call at 250-258-9888.