The Canadian government has announced amendments to the Prohibition on the Purchase of Residential Property by Non-Canadians Act’s accompanying Regulations to enhance the flexibility of newcomers and businesses looking to add to Canada’s housing supply. These amendments expand exceptions to allow non-Canadians to purchase residential property in certain circumstances, which will further support individuals and families seeking to build a life in Canada by pursuing home ownership in their communities sooner and address housing supply issues.
One of the key amendments is to enable more work permit holders to purchase a home to live in while working in Canada. Work permit holders who have 183 days or more of validity remaining on their work permit or work authorization at the time of purchase, and who have not purchased more than one residential property, will be eligible. The current provisions on tax filings and previous work experience in Canada are being repealed.
The amendments also repeal existing provisions so that the prohibition doesn’t apply to vacant land zoned for residential and mixed use, which can now be purchased by non-Canadians and used for any purpose by the purchaser, including residential development.
In addition, an exception for development purposes allows non-Canadians to purchase residential property for the purpose of development. The amendments also extend the exception currently applicable to publicly traded corporations under the Act to publicly traded entities formed under the laws of Canada or a province and controlled by a non-Canadian.
Furthermore, the control threshold for privately held corporations or entities formed under the laws of Canada or a province and controlled by a non-Canadian has been increased from 3% to 10%. This aligns with the definition of ‘specified Canadian Corporation’ in the Underused Housing Tax Act.
These amendments come into force on March 27, 2023, and aim to balance the need to make housing more affordable for Canadians while ensuring that any changes to the rules do not fuel the housing crisis or cause further inequality.
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