Buying a property in Canada

Buying a property in Canada and getting a residence permit in Canada

Currently there are a few countries that allow foreigners to buy a property and reside in their country, but unfortunately Canada is not one of these countries. It is a fact that buying a property in Canada for non-residents does not lead to getting a residence permit in Canada or citizenship, and it is mandatory to go through the legal process of immigration.

The important thing is that if you are buying a property just to get a residence permit in Canada, you should know that starting a business is a faster solution to enter this country. In this regard, only if you intend to invest in real estate, regardless of getting a residence permit in Canada, you can achieve to your desired result through buying a property in Canada, and this will only be a foresight and long-term investment for you.

If you do not reside in Canada and you are planning to buy a property in Canada, you should know that going to real estate agencies is the first step. It is also possible to give the buyers who do not reside in Canada a loan by calculating a higher interest rate. In this case, lending companies and institutions are responsible for providing a part of the costs of the property during the conclusion of a mortgage agreement with the buyer.

Buyers who are not residents in this country must pay 35% of the total amount of the property first. One thing to keep in mind is the importance of contacting with an accountant or tax advisor. For example, when you buy a property in Canada as a foreign buyer, you pay the same tax as a Canadian citizen, but when you are selling it the situation is different, and the Tax Office of Canada (The Canada Revenue Agency) enforces certain rules and regulations on foreigners. For more information in this regard, you should visit the official website of the Tax Office of Canada (The Canada Revenue Agency).

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Topics reviewed in this article:

• Buying a property in Canada and people who are eligible to buy property
• Buying a property in Canada and its legal process
• The prices of Houses in Canada 2020
• Ancillary costs of buying a home in Canada

Buying a property in Canada and people who are eligible to buy property

When it comes to buying a property in Canada, you need to know that the rules are different for citizens of different countries. Any investor who is interested in buying a property in other countries can also buy a property in Canada. The only thing which is worth mentioning in this section is that from April 21, 2017, people who are not resident in Canada must pay a 15% surcharge (surplus tax), which of course applies only in certain areas of Canada.

The laws of Buying a property for non-residents (foreigners) in Canada also applies to Canadians who have lived abroad for more than half a year, but they are exempt from paying a 15% surcharge (Tax surplus). So people who want to buy a property in Canada, can first get a residence permit in this country though different investments in different states with much lower costs, and then buy a property in Canada which will costs less and will be more appropriate.

Buying a property in Canada and its legal process

Buying a property in Canada has some steps that must be taken by experienced lawyers who are aware of the laws and the financial laws and tax issues of this country, in this section we will discuss the requirements and legal process of buying a property in Canada.

• The real estate agent and the lawyer assist the seller in preparing the documents to be offered for the purchase. The offer to buy will be presented to the seller with an advance payment of about 10% of the amount of the purchased property.
• Buyer and seller agree on price.
• A copy of the agreement is sent to the lawyer to review the terms and specify the date of the contract.
• There is an opportunity to visit the property until the date of signing the contract.
• The lawyer does the necessary investigations about the seller to make sure that he/she has no criminal record and no property debt.
• The lawyer prepares a document in which he / she approves the amount of the contract and the amount that the buyer has to pay.
• The lawyer pays (gives) all of the amounts to the seller and the documents of the house and keys are provided to the buyer after the contract is signed.

It should be noted that to perform these steps, you can enter this country with a Canadian Multiple entry visa, or in other words, with a Canadian tourist visa, and go through all these steps according to the better timing you have.

The prices of Houses in Canada 2020

Canadian homes have different prices depending on which city and in which area of the city they are located. Toronto is one of Canada’s most popular cities to live in, so here we take a look at the prices of houses in Toronto Canada in 2020. The average price of a house and an apartment in Toronto in 2020 is $ 832,703. The cheapest homes in Toronto cost around C $ 400,000, which is usually far from downtown and parts of which may not be completed yet. By 2020, house prices in Toronto will be on the rise.

Ancillary costs of buying a home in Canada

• Land transfer tax

Land transfer tax (property transfer) covers between 0.5 to 2% of the total value of the property. Of course, Alberta, rural Nova Scotia and Saskatchewan are exceptions to this rule.

• Legal fees

It is negotiable, but in some cases the legal fee can be up to 10% of the value of the property.

• Taxes on goods and services

For newly built homes, a 5% Goods and Services Tax (GST) is levied on the purchase price. Of course, GST is often included in the sale price.

• Estoppel certification fee (for apartments and separate units only)

An Estoppel Certificate describes the legal and financial status of an apartment and its costs up to C $ 100 (US $ 74). This fee does not exist in Quebec.

• Legal fees and official documents

Attorneys (or notaries in Quebec) check the buying offer, research the seller’s credit, prepare the loan documents, and oversee the details of the process. Legal fees are at least US $ 370 plus GST, depending on the province, the complexity of the buying and the selling process, and the value of the property. Each party pays his/her attorney’s fee separately.

• The cost of real estate agency

Real estate agent costs vary from 3 to 7% of the property value plus 6% GST. The seller usually pays the agent’s fee, but in some cases the buyer must also pay a fee.