Amendments to the Prohibition on the Purchase of Residential Property by Non-Canadians Act and the Regulations
It didn’t take long for the government to recognize how this ban essentially discourages new comers to establish their roots in Canada and consider our country their new home. Amendments have been introduced on March 27, 2023. Noting the reason for the amendments, Hon. Ahmed Hussen, Minister of Housing and Diversity and Inclusion, said: “These amendments strike the balance in ensuring that housing is used to house those living in Canada, rather than a speculative investment by foreign investors.”
There are four notable amendments effective March 27, 2023, namely:
Enable work permit holders to purchase a home to live in while working in Canada
This is the most beneficial among all the amendments so far. This amendment will allow who hold work permit or authorised to work in Canada under the Immigration and Refugee Protection Regulations to purchase a residential property. If you hold a work permit that is valid for 183 days or more remaining on their work permit or work authorization, you are eligible to purchase one residential property. The requirement on tax filing and previous work experience in Canada are repealed.
The prohibition no longer applies to vacant lands
This repeals section 3(2) of the Act which prohibits the purchase of vacant land zoned for residential use or mixed-used by non-Canadians. Vacant land zone for resident and mixed use can now be purchased by non-Canadians for any purpose the purchaser deems, including residential development.
Purchasing for the purpose of development
This exception now allows non-Canadians to purchase residential property for the purpose of development. Notably, this exception is extended to publicly traded corporations under the Act or to publicly traded entities formed under the laws of a province or Canada and controlled by a non-Canadian.
Foreign threshold increases from 3% to 10% for foreign controlled corporations
For privately held corporations or privately held entities, the foreign control threshold has now increased to 10% from 3%, in line with the definition of ‘specified Canadian Corporation’ under the Underused Housing Tax Act.
The amendments bring good news to our foreign workers who are integral in the Canada’s economy.