Foreign Buyers in Canada: Who Can Still Buy Residential Property Before 2027?

You are not a Canadian citizen.

You may not yet be a permanent resident.

And you want to buy property in Canada.

The first question seems obvious:

“Am I still allowed to buy a house?”

But the answer is not simply yes or no.

Since January 1, 2023, Canada’s Prohibition on the Purchase of Residential Property by Non-Canadians Act has restricted certain residential real estate purchases by non-Canadians.

The federal prohibition was subsequently extended and is currently scheduled to remain in effect until:

January 1, 2027.

But that does not mean everyone who is not a Canadian citizen is automatically prohibited from buying.

Some buyers are exempt.

Some properties are not covered.

Some transactions are excluded.

And even the location of the property can change the answer.

That is why the real question is not:

“Can foreigners buy property in Canada?”

It is:

“Can this buyer purchase this specific property, in this specific location, under the rules that apply to their situation?”

That distinction can determine whether a transaction can move forward at all.

What Is the Current Foreign Buyer Rule in Canada?

Federal law generally prohibits a non-Canadian from directly or indirectly purchasing certain residential property in Canada while the prohibition remains in effect.

The measure is currently scheduled to remain in place until January 1, 2027.

But the term non-Canadian has a specific legal meaning.

Generally, the rules can apply to certain individuals who are neither Canadian citizens nor permanent residents, as well as certain corporations and entities controlled by non-Canadians.

You can review the current Prohibition on the Purchase of Residential Property by Non-Canadians Act directly through the Government of Canada.

In other words, looking only at someone’s passport is not enough to determine whether a purchase is permitted.

You first need to understand the buyer’s exact legal status.

Can Permanent Residents Buy Property in Canada?

Yes.

A Canadian permanent resident is not treated as a prohibited foreign buyer simply because they have not yet obtained Canadian citizenship.

That is an important distinction.

Someone can therefore be a non-citizen and still be able to purchase residential property in Canada.

Canadian citizenship and permanent residence are not the same thing.

And under this federal prohibition, that difference matters.

Can a Work Permit Holder Buy a House in Canada?

In certain circumstances, yes.

The rules allow certain work permit holders and people otherwise authorized to work in Canada to qualify for an exemption.

Under the current regulations, important conditions include:

• having at least 183 days of validity remaining on the work permit or work authorization on the date of purchase;
• not having purchased more than one residential property.

The requirements can be reviewed in the federal Prohibition on the Purchase of Residential Property by Non-Canadians Regulations.

That means a temporary worker should not automatically conclude:

“I am not a permanent resident, so I cannot buy.”

A much better question is:

“Does my current status qualify me for an exemption?”

That should be confirmed before taking on significant contractual obligations.

Can International Students Buy Property in Canada?

In certain very specific circumstances, yes.

But the conditions applying to international students are considerably more restrictive.

The federal regulations include requirements involving:

• Canadian income tax returns filed in previous years;
• physical presence in Canada;
• the purchase price of the property;
• the number of residential properties previously purchased.

Under the current rules, the student exemption includes a maximum purchase price of $500,000, along with other strict requirements.

Simply studying in Canada does not automatically make someone eligible to purchase residential property.

Student status alone is not enough.

If the purchase depends on this exemption, the requirements should be confirmed before making an offer.

What About Protected Persons?

Certain categories of people can also qualify for exemptions.

This includes protected persons under Canadian immigration legislation.

The regulations also address certain other categories of foreign nationals in specific circumstances.

The important principle is simple:

Do not decide whether someone can buy property based solely on their nationality.

Their exact legal status can completely change the answer.

Can a Non-Canadian Buy With a Canadian Spouse?

In certain circumstances, yes.

The Act provides an exemption when a non-Canadian purchases residential property with a spouse or common-law partner who has qualifying status.

That can include a spouse or common-law partner who is:

• a Canadian citizen;
• a permanent resident;
• a person registered as an Indian under the Indian Act;
• someone falling within certain other exemptions under the legislation.

This can be particularly important for couples with different immigration statuses.

But the exact status of both parties and the structure of the transaction should be verified before signing.

Because when a purchase depends on a legal exemption, this is not the time to rely on:

“I think it should be okay.”

You need to know.

What Types of Residential Property Are Covered?

The Act does not automatically cover every type of real estate in Canada.

The federal definition of residential property includes certain buildings containing up to three dwelling units, as well as certain parts of buildings.

Depending on the property, this can include:

• single-family homes;
• semi-detached homes;
• condominiums;
• duplexes;
• triplexes.

Buildings containing four or more dwelling units generally fall outside this particular definition.

That distinction can be especially important for investors.

A triplex and a four-unit building may look very similar from an investment perspective.

Legally, however, that fourth unit can completely change the analysis.

Does the Foreign Buyer Ban Apply Everywhere in Canada?

No.

This is one of the most important distinctions in the regulations.

Residential properties located outside a Census Metropolitan Area or Census Agglomeration, based on Statistics Canada classifications, can fall outside the geographic scope of the federal prohibition.

That means two very similar properties can potentially produce different answers for exactly the same buyer.

Same immigration status.

Same type of property.

Similar price.

But a different location.

The Canada Mortgage and Housing Corporation explains the geographic scope and key exemptions.

In real estate, a few kilometres can sometimes change more than the price. They can change the rules that apply to the transaction.

That is why location should be verified rather than assumed.

What About Greater Montreal and the South Shore?

For non-Canadian buyers looking in Greater Montreal or the South Shore, the federal rules deserve particular attention.

Areas such as Saint-Laurent, Pierrefonds-Roxboro, Kirkland, Vaudreuil-Dorion, Longueuil, Boucherville, Sainte-Julie, Saint-Constant and Châteauguay are part of a broader metropolitan environment where this issue should not be ignored.

A common mistake is assuming that moving farther away from downtown Montreal automatically places a property outside an affected area.

It does not.

A house can feel far from central Montreal while still being located within a statistical area covered by the federal rules.

Do not rely on your perception of distance. Verify the property’s actual geographic classification.

Can Non-Canadians Buy Vacant Land?

Yes, the federal rules changed significantly on this point.

Since March 27, 2023, the prohibition no longer applies to vacant land under these regulations.

That change opened the door to certain land acquisitions that would otherwise have appeared problematic under the original rules.

It would therefore be incorrect to assume that every vacant property capable of eventually accommodating residential development is automatically prohibited for a non-Canadian buyer.

Once again:

The type of property matters.

Can a Non-Canadian Buy Residential Property for Development?

In certain circumstances, yes.

The regulations provide an exception for the acquisition of residential property by a non-Canadian for the purposes of development.

But that exception should not be interpreted too broadly.

Buying a property simply to rent it, hold it or wait for its value to increase does not necessarily turn the transaction into a development project.

There is an important difference between genuine development or redevelopment and ordinary repairs, renovations or remodelling.

If your ability to purchase depends on this exception, obtain legal confirmation before committing to the property.

An investment strategy and a development project are not necessarily the same thing.

Can a Non-Canadian Buy a Rental Property?

It depends on the property.

Planning to rent the property does not automatically create an exemption.

If the property meets the federal definition of residential property covered by the Act and is located in an affected area, intending to rent it does not necessarily make the purchase permissible.

On the other hand, certain buildings containing four or more dwelling units can fall outside the definition involved in this particular prohibition.

So the question is not simply:

“Will I live in the property or rent it?”

You also need to ask:

“What type of property am I actually buying?”

Can Non-Canadians Rent a Home in Canada?

Yes.

The prohibition concerns certain purchases of residential property.

It does not prevent a non-Canadian from renting an apartment, condominium or house in Canada.

Buying an ownership interest and entering into a residential lease are two completely different transactions.

What Types of Property Transfers Are Excluded?

Not every transfer of real estate is a conventional purchase and sale.

The regulations exclude certain acquisitions arising from situations such as:

• death;
• divorce;
• separation;
• a gift;
• certain trusts created before the Act came into force;
• the exercise of a security interest by a secured creditor;
• certain acquisitions for development purposes.

These distinctions matter because a change in ownership does not always result from someone simply deciding to purchase a property on the open market.

What if the Purchase Agreement Was Signed Before January 1, 2023?

The Act contains a rule for certain transactions that predate its entry into force.

The prohibition does not apply where a non-Canadian became liable or assumed liability under an agreement of purchase and sale before the Act came into force.

For someone beginning a new property search today, this situation will obviously be uncommon.

But it remains an important distinction for older transactions.

Can Someone Get Around the Ban by Creating a Corporation?

Not simply.

The legislation does not apply only to purchases made personally.

Certain corporations and other entities can also be considered non-Canadian when they are controlled by non-Canadians according to the applicable rules.

Creating a Canadian corporation does not automatically transform a prohibited transaction into a permitted one.

Indirect ownership structures are part of what the legislation addresses.

Changing the buyer’s name on paper does not necessarily change the legal reality behind the purchase.

What Happens if a Non-Canadian Buys Property in Violation of the Act?

The consequences can be serious.

A non-Canadian who violates the prohibition can be found guilty of an offence and face a fine of up to $10,000.

A person or entity that knowingly counsels, induces, aids or abets a prohibited purchase can also face consequences.

In certain circumstances, a court can order the sale of the residential property.

There is another important detail.

A violation of the prohibition does not automatically invalidate the sale itself.

The Act specifically provides that a contravention does not affect the validity of the sale.

That can make the situation considerably more complicated.

And it raises an obvious question:

Why discover after buying that the transaction may violate the law when the issue could have been investigated before making the offer?

That is where preparation matters.

Can a Real Estate Broker Decide Whether a Buyer Qualifies?

Not alone.

A real estate broker can help identify important questions, documents and potential issues that should be clarified before the buyer makes a commitment.

But when a transaction depends on the interpretation of a legal exemption, other professionals may need to become involved.

Depending on the situation, that can include a:

• notary;
• lawyer;
• immigration professional;
• tax professional.

A real estate broker does not replace legal advice.

The value of having the issue identified early is that the right professional can become involved before the buyer takes on significant obligations.

Discovering after an accepted offer that a buyer may not qualify is much more complicated than asking the right questions before signing.

Does the Foreign Buyer Ban Guarantee Lower Home Prices for Canadians?

No.

It would be too simplistic to claim that restricting certain foreign buyers automatically causes Canadian real estate prices to fall.

Home prices are influenced by many factors, including:

• housing supply;
• interest rates;
• population growth;
• employment;
• availability of credit;
• new construction;
• inventory;
• local demand;
• broader economic conditions.

The federal policy can influence one part of demand.

It does not control the real estate market by itself.

A policy can change certain market conditions without determining the direction of prices on its own.

Will the Foreign Buyer Ban Definitely End on January 1, 2027?

Under the legislation currently in force, the prohibition is scheduled to remain in place until January 1, 2027.

But that date should not become the sole foundation of a future buying strategy.

Why?

Because legislation can be extended.

Regulations can be amended.

Exemptions can change.

If you plan to purchase after January 1, 2027, do not simply assume:

“After that date, everything will automatically be permitted.”

Verify the rules actually in force when you are ready to buy.

The question that matters is not what the law was when you started looking.

It is what the law allows when you are actually ready to purchase.

What Should a Non-Canadian Verify Before Making an Offer?

Before signing, clarify:

• What is the buyer’s exact immigration status?
• Are they a permanent resident?
• Do they hold a work permit or work authorization that may satisfy an exemption?
• Could the spouse or common-law partner exemption apply?
• Is the property located in an affected area?
• How many dwelling units does the building contain?
• Does the property actually fall within the federal definition of residential property?
• Is it vacant land?
• Is the acquisition genuinely for development?
• Could another exemption under the Act or regulations apply?
• Is a corporation or indirect ownership structure involved?
• Has the appropriate legal professional confirmed eligibility before the buyer takes on significant obligations?

Those are the questions that help determine whether a transaction can proceed.

Not simply the nationality printed on a passport.

The Bottom Line

Canada’s federal prohibition on certain purchases of residential property by non-Canadians is currently scheduled to remain in effect until January 1, 2027.

But that does not mean everyone who is not a Canadian citizen is automatically unable to buy property.

Permanent residents are not treated as prohibited foreign buyers simply because they have not yet obtained Canadian citizenship.

Certain temporary workers can qualify for an exemption when they meet the applicable conditions.

Exemptions can also apply to certain spouses or common-law partners, protected persons and other specific situations.

And some properties or acquisitions can be treated differently depending on the number of dwelling units, geographic location, nature of the land or genuine purpose of the acquisition.

That is why the wrong question is:

“Can a foreigner buy property in Canada?”

The better question is:

“Can this buyer purchase this specific property, in this specific location, under the rules in force today?”

And when the answer depends on a legal exemption, verify it before signing.

Not after.

The right decision. At the right time. For the right reasons.

Jonathan Cabana
Residential and Commercial Real Estate Broker
eXp Québec
Greater Montreal | South Shore
(514) 476-0730