Quick Answer
- Canada’s foreign buyer ban is scheduled to expire on January 1, 2027. Ottawa is currently reviewing what should replace it, and Housing Minister Gregor Robertson has publicly pointed to Australia’s approach as one model under consideration.
- The Australian model would allow foreign buyers to purchase new construction and vacant land while keeping existing homes off-limits. Nothing has been tabled or passed into law as of August 2026.
- Permanent residents are treated the same as Canadian citizens and face no restrictions under the current Act. Work-permit holders, refugees, and international students with 183 or more days remaining on their status may qualify for existing exemptions today.
Why This Matters Right Now
If you have been following housing news this year, you have probably seen headlines about Canada’s foreign buyer ban expiring or the government reviewing what comes next. That coverage is real, but calmer than the headlines suggest. The federal ban is still in force today, and nothing changes automatically tomorrow.
What has shifted is the conversation in Ottawa. Housing Minister Gregor Robertson has confirmed a formal review ahead of the January 1, 2027 expiry, and reporting through 2026 suggests the government is not planning a straight extension. For anyone thinking about buying, selling, or renewing a mortgage over the next twelve months — including readers watching the 2026 CREA housing forecast — this is worth understanding in plain English.
Pick Your Path: Who This Article Is For
The ban and the review affect different Canadians in different ways. Use this quick grid to jump to what matters for you.
What the Foreign Buyer Ban Actually Does Today
In practical terms, the Act blocks foreign nationals and foreign-controlled corporations from buying residential property inside a Census Metropolitan Area (CMA) or Census Agglomeration (CA) — the Statistics Canada geographies covering most Canadian cities. Some rural purchases fall outside the ban’s reach, but most Canadian home sales do not.
Penalties are meaningful. A non-Canadian who buys in violation — plus anyone who knowingly helps them, such as an agent or lawyer — can be fined up to $10,000, and a court can order the sale. Every industry term used here is defined in our full mortgage glossary.
Who Is Actually Exempt Today
The most important exemption is for permanent residents. Under the Act, PRs are treated the same as Canadian citizens — no restrictions, no separate paperwork, no additional application. If you are a new PR, you can move forward the same way any Canadian buyer would, starting with our first-time home buyer guide.
For temporary residents, the rules are more detailed. A work-permit holder with at least 183 days remaining who has filed Canadian taxes and has not already purchased may qualify. International students face similar residency and tax-filing conditions. Refugees, protected persons, and non-Canadian spouses purchasing jointly with an eligible Canadian may also qualify.
The March 2023 amendments then added two more doors: vacant land zoned for residential or mixed use, and property acquired specifically for development or substantial redevelopment. Simple repairs and buy-to-rent purchases do not qualify under the development exemption.
What the Review Could Change After 2026
The reason the review is happening at all is that experts have long questioned whether a blanket ban meaningfully improved affordability. Foreign buyers represented roughly 1.1% of home sales in British Columbia in 2021 — the year before the ban was announced — down from about 3% in 2017. Meanwhile, average Canadian home prices rose more than 20% over the ban period.
The Australian-style model reportedly under consideration would let foreign buyers purchase new construction and vacant land while remaining barred from existing homes. Developers argue foreign pre-sale buyers were roughly one in ten purchasers of new condos in Canada’s largest markets, and that today’s pre-sale volumes make it hard for projects to secure construction financing. Our pre-construction condo market post covers that supply story in detail.
None of this is decided. Any replacement framework would go through public federal process before taking effect. Until something is passed, the default is that the ban lapses on January 1, 2027.
Step-by-Step: What Canadian Buyers Should Do Between Now and January 2027
Policy uncertainty is not a reason to freeze. Here is a practical five-step path readers can follow today, whatever Ottawa decides.
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1
Confirm your status first Citizen, permanent resident, or exempt temporary resident? Your status determines every downstream question, from the ban to insured lending to provincial taxes.
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2
Get pre-approved so financing is ready Rate windows and inventory windows do not wait for policy announcements. A written pre-approval gives you a clear budget and a rate hold — get an instant pre-approval certificate to start.
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3
Understand the stress test that applies regardless The OSFI B-20 stress test requires borrowers at federally regulated lenders to qualify at the greater of contract rate plus 2% or 5.25%. This applies to citizens, PRs, and exempt temporary residents alike, and is not affected by the ban or the review.
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4
Watch for the federal announcement, but do not chase it Whatever replaces the Act will have public implementation dates. Rules will not change overnight without notice.
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5
Talk to a licensed mortgage broker before making decisions Insured lending through CMHC, Sagen, and Canada Guaranty, alternative lending for self-employed buyers, and provincial taxes all vary by situation. Razi Khan, Founder and Mortgage Broker at Pegasus has guided clients through multiple extensions of this ban, and practical advice is almost always specific to your file.
How This Interacts With Provincial Foreign-Buyer Taxes
One point that gets lost in the news coverage: the federal foreign buyer ban is separate from provincial foreign-buyer taxes. If Ottawa lets the ban lapse or replaces it with the Australian-style model, provincial taxes do not automatically disappear.
Ontario’s Non-Resident Speculation Tax (NRST) applies province-wide at 25% of the purchase price when the buyer is a foreign national. Toronto adds a further 10% Municipal NRST on registrations in the city. British Columbia charges a 20% Additional Property Transfer Tax on foreign buyers in specified regions including Metro Vancouver and the Fraser Valley. Alberta has no comparable provincial foreign-buyer tax.
For readers in Quebec, closings require a notary and QST is administered by Revenu Québec rather than the CRA. Our OSFI 2026 mortgage rules for investors post covers how these pieces fit together for investor files.
| Rule | Applies to | Rate / penalty | Geography | Status Aug 2026 |
|---|---|---|---|---|
| Federal Prohibition Act | Foreign nationals and foreign-controlled corporations | Fine up to $10,000 plus court-ordered sale | CMAs and CAs Canada-wide | In force through Jan 1, 2027 — under review |
| Ontario NRST | Foreign nationals, foreign corporations, taxable trustees | 25% of purchase price (+10% Toronto MNRST in-city) | All of Ontario | Active — rebates may apply |
| BC Additional Property Transfer Tax | Foreign nationals and foreign corporations | 20% of fair market value of foreign share | Metro Vancouver, Fraser Valley, Capital, Nanaimo, Central Okanagan | Active |
Common Mistakes Canadians Make Reading the News on This
Housing coverage on this file has been noisy. Here are the misreadings we see most often when clients come in with questions.
- Assuming permanent residents are affected. PRs are treated the same as citizens under the Act.
- Assuming provincial taxes end with the federal ban. Ontario’s NRST and BC’s Additional Property Transfer Tax are separate provincial laws.
- Assuming any change would happen overnight. Federal policy replacements go through public process with fixed effective dates.
- Assuming the ban meaningfully lowered prices. Foreign buyers were roughly 1.1% of BC home sales in 2021, yet average Canadian prices still rose more than 20% during the ban period.
- Confusing foreign investment with foreign residency. Someone who lives and works in Canada on a valid permit is not a foreign buyer for most policy purposes.
- Skipping the broker conversation. Working with a mortgage broker often surfaces exemptions clients did not know they qualified for.
Frequently Asked Questions
Will Canada’s foreign buyer ban be extended past 2027?
Can a non-resident buy a house in Canada in 2026?
Does the foreign buyer ban apply to permanent residents?
Can someone on a work permit buy a home in Canada?
Can foreigners buy pre-construction condos in Canada?
What is the fine for breaking the foreign buyer ban?
If the ban ends, will Ontario’s Non-Resident Speculation Tax also end?
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About the author
Razi Khan
Founder, CEO & Licensed Mortgage Broker · Pegasus Mortgage Lending · Toronto, Ontario · FSRA Lic # 11479
Razi Khan is the Founder, CEO, and a licensed Mortgage Broker at Pegasus Mortgage Lending Center Inc., based in Toronto. With over 20 years of experience in the Canadian mortgage industry, Razi has personally guided more than 3,000 clients through some of the most complex and high-stakes financial decisions of their lives — from first-time purchases in the GTA to refinancing strategies, alternative lending solutions, and cross-border mortgages for Canadians buying in the United States.
Razi founded Pegasus in October 2008, launching the brokerage at the height of a global financial crisis. He works across the full spectrum of borrower profiles, with particular expertise in complex files including self-employed borrowers, credit-challenged clients, and investors building multi-property portfolios.
Learn more about Razi Khan →Sources & References
- Government of Canada — Prohibition on the Purchase of Residential Property by Non-Canadians Act. laws-lois.justice.gc.ca/eng/acts/P-25.2
- Department of Finance Canada — Two-year extension of the ban (February 4, 2024). canada.ca — finance news release
- Government of Canada — March 2023 regulatory amendments. cmhc-schl.gc.ca
- Borden Ladner Gervais LLP — Canada’s foreign buyer ban: What the 2027 expiry signals for investors (July 2026). blg.com
- Government of Ontario — Non-Resident Speculation Tax (25%). ontario.ca
- City of Toronto — Municipal Non-Resident Speculation Tax (10%, effective Jan 1, 2025). toronto.ca
- Government of British Columbia — Additional Property Transfer Tax (20% in specified regions). gov.bc.ca
- Office of the Superintendent of Financial Institutions — Guideline B-20. osfi-bsif.gc.ca