The federal government is extending a ban on foreigners buying homes in Canada, Finance Minister Chrystia Freeland announced in a release Sunday.
The rules were first announced in 2022 and will now be extended until the beginning of 2027. Foreign nationals and commercial businesses are prohibited from purchasing residential property in Canada, with the exception of some international students, asylum seekers, and temporary workers.
“Extending the foreign purchase ban will ensure that homes are used as homes for Canadian families and do not become a speculative financial asset class,” Freeland said in a statement Sunday. .
Experts question whether the ban has had a significant impact on Canadian housing prices. relatively small share Percentage of the total housing market owned by non-Canadians. For example, in some states measured in 2020, market share owned by non-residents ranged from 2 to 6 percent.
In 2021, it’s only about 1.1 in B.C. Percentage of home sales includes foreign buyers.
Additionally, there are further exceptions to the home purchase rules that allow for the purchase of buildings with four or more dwelling units and buildings in some sparsely populated areas.
“The ban on foreign buyers was more political than economic policy or housing policy,” Brendon Ogmundson, chief economist at the BC Real Estate Association, told CBC News late last year.
Deputy Prime Minister Chrystia Freeland announced at a press conference with Mayor Olivia Chow that the federal government will provide more than $162 million to support asylum seekers and other vulnerable communities in Toronto. Toronto will also receive an additional $19.75 million through the Ontario Housing Benefit, which helps low-income people pay rent.
Some Canadian provinces have already introduced a foreign homebuyer tax, and Toronto recently proposed a local tax on non-Canadian homebuyers.
Housing has become a major political flashpoint as Canadians grapple with a severe housing affordability crisis. The Canada Mortgage Corporation (CMHC) says 3.5 million more homes need to be built by 2030 on top of projected growth to achieve affordability.
Conservative leader Pierre Poièvre has made the housing crisis a key part of his political criticism of the ruling Liberal Party, saying the country is in “housing hell”.
He has proposed a series of measures to help increase housing starts, including using federal funds to reward municipalities that meet ambitious housing goals and penalize those that fall short. It also includes a series of incentives.
The federal government has responded to the crisis with a number of actions, including a series of negotiations with major cities to link federal funds from the Housing Acceleration Fund to zoning reforms and other pro-construction policy changes at the municipal level.
