As most of you may know, the government of Canada recently passed the Prohibition on the Purchase of Residential Property by Non-Canadians Act (the “Act”). The Act prohibits non-residents from purchasing residential real estate in Canadian for a two-year period, which began on January 1, 2023. Non-Canadians, as defined in the Act, are individuals who are not:

• A Canadian citizen; 
• A person registered as an Indian under the Indian Act; 
• A permanent resident of Canada; 
• A corporation that has not been incorporated in Canada; 
• A corporation incorporated in Canadian that is controlled by foreign corporations or foreign individuals; or
• A prescribed person or entity under the regulations. 

For clarity, non-Canadians (those individuals who do not fall into one of the above categories) will not be able to purchase detached houses, semi-detached houses, rowhouse units or residential condominium units. The Act applies to direct or indirect residential property purchases and includes purchases made through partnerships, trusts or other entities. All those assisting in real estate transactions must take this seriously, as the Act imposes a $10,000 fine for any non-Canadian or anyone who knowingly assists a non-Canadian and is convicted of violating the Act. 

This imposes yet another layer of government diligence on all of us. 

Before starting to work with any buyer, inquire about their status under this legislation to avoid investing significant amounts of time and effort only to find out that your buyer cannot buy.

And, never tread in the grey area and risk that $10,000 fine. 

Protect yourself.



Cheers,

Barry and Maryam

Stay tuned for a post on the exceptions that apply to temporary residents working and studying in Canada. Refugees, accredited members of foreign missions in Canada and non-Canadian spouses and common-law partners will be discussed.