Changes are coming in January 2023 for non-resident buyers

On June 23, 2022, the Parliament of Canada passed the Prohibition on the purchase of residential property by non-Canadians Act. Coming into force on January 1st, 2023, this Act will last for two years and will minimally affect the Canadian real estate market. Some of the key points to this act are:

• It does not apply to Canadian citizens and permanent residents.
• Applies to non-Canadians directly or indirectly purchasing residential property in Canada for a period of two years.
• Applies to residential property, including detached houses or similar buildings of one to three dwelling units, as well as parts of buildings such as semi-detached houses, condominium units, or other similar premises.
• Applies to direct or indirect residential property purchases, including purchases made through corporations, trusts, or other legal entities.
• Establishes penalties for non-compliance applicable to non-Canadians, as well as any person or entity knowingly assisting a non-Canadian in violating the prohibition.

If you are a non-resident, it is recommended that you hold your investment property for the time being until January 1st, 2025. Although not flat, the current real estate market has softened from the highs of early 2022. Inflation and rising interest rates compounded with worldwide uncertainties have pushed home buyers to the sidelines for the time being. Certainly, when inflation is tamed and interest rates show signs of lowering in late 2023, or early 2024, we have little doubt that the Vancouver real estate market will once again see price increases.

For the time being, holding your property is the best bet.