Many foreigners will be banned from buying residential property in Canada until 2025 under a ban that came into effect this year.
It is designed to address concern that foreign investments are driving up the cost of housing in Canada.
A temporary ban on foreign investments on residential properties was first proposed by Canada’s Prime Minister Justin Trudeau during the 2021 election campaign.
This was aimed at providing some relief for Canadians amid rapid rises in house prices (although prices started to decline in 2022 due to rising interest rates).
After winning the election, Trudeau’s Government formalised its promise in last year’s Federal Budget. It was signed into law in June, and came into force at the start of 2023.
Who won’t be banned?
There will be some non-Canadians who will still be able to buy residential property, including refugees and workers or students who are working toward permanent residency in Canada.
Foreigners will still be able to purchase some recreational properties, such as a holiday home in a non-metro area.
It’s not known how many foreign homeowners there are overall in Canada. However, data from Ontario and British Columbia (two of Canada’s biggest provinces) estimate that non-resident owners account for up to 5% of its homeowners.
Some experts have also expressed scepticism about the ideology behind the ban, saying importance should instead be placed on boosting housing supply.