Buying Property in Canada
Buying property in Canada can be a very profitable way to invest in Canada, but it is important to note that you cannot obtain permanent residency in Canada through property purchase. One of the advantages of buying a house in Canada is that there is no limit on the value of the property purchased for non-Canadian citizens. If you are looking to immigrate to Canada through buying a house, you must meet the following requirements:
- Have a good credit history in Canada (to get a loan)
- Proof of stable and sufficient income
- Have a down payment (usually between 5% and 20% of the property price)
- No criminal record
House prices in Canada vary by province, area, and neighborhood, with average costs ranging from CAD 500,000 to CAD 2.5 million. Purchasing property in Canada is a viable route for immigration.
For more information or questions about investment in Canada through property, contact the Malekpour Immigration Institute for free consultation or leave your questions in the comments.
Advantages and Disadvantages of Buying a House in Canada
We will examine the advantages and disadvantages of buying a house in Canada in detail:
| Advantages of Buying a House in Canada | Disadvantages of Buying a House in Canada |
|---|---|
| Property value increases over time | Requires a significant down payment |
| Builds equity and long-term assets | Annual property taxes |
| Possibility to rent out and earn income | Home insurance and additional expenses |
| Freedom to customize and renovate the property | Risk of property value decline in some areas |
| Potential tax deductions if the property is rented out | Annual property taxes (duplicate, but commonly emphasized) |
Conditions for Buying a House in Canada
Foreign buyers can easily purchase all types of properties in Canada—apartments, single-family homes, luxury estates, commercial real estate, farms, and vineyards—without restrictions. Non-Canadian citizens are eligible for mortgages covering up to 65% of the property’s value, requiring a minimum 35% down payment. To qualify, buyers must provide financial details (assets, income, employment) through a bank interview by phone or email.
Generally, to buy property in Canada, you must meet the following conditions:
- Having a down payment (usually between 5% and 20% of the property price)
- Ability to pay monthly installments
- Having adequate financial credit
- Providing for ancillary costs such as property transfer tax and legal fees
- No criminal record
Residency through Buying Property in Canada
Currently, very few countries allow foreign nationals to buy property and obtain residency in that country. Buying property in Canada does not lead to residency or Canadian citizenship and nationality for non-residents. Canada requires going through its official immigration process for permanent residency. However, foreigners can still invest in Canadian real estate as a long-term investment.
If your goal is immigration, starting a business in Canada offers a faster pathway. Non-residents can still purchase property by working with real estate agencies, and may qualify for mortgages—though often at higher interest rates and with larger down payments.
Steps for Buying a House in Canada
Buying property in Canada involves steps that must be carried out by experienced lawyers knowledgeable about the legal, financial, and tax matters of this country. In this section, we will address the requirements and legal steps for purchasing property in Canada.
- The real estate representative, along with a lawyer, assists in preparing the purchase offer document for the property seller. The purchase offer is presented to the seller with a down payment of approximately 10% of the property price.
- The buyer and seller agree on the price.
- A copy of the agreement is sent to the lawyer for them to review the terms and specify the contract’s signing date.
- Until the date of signing the contract, there is an opportunity to visit the property.
- The lawyer conducts necessary checks regarding the seller to ensure they have no criminal record and that the property has no debts.
- The lawyer prepares a document that confirms the contract amount and the payment that the buyer needs to make.
- The lawyer pays all amounts to the seller, and the document and keys to the home are handed over to the buyer after the contract is signed.
It is worth mentioning that to carry out these steps, you can enter this country with a multi-entry Canada visa or, in other words, with a Canadian tourist visa and complete all these steps according to the better timing you have.
How to Write a Contract When Buying or Renting a House in Canada
Writing and signing a contract for buying or renting a house in Canada is a crucial step in this process. Contracts should be written precisely and clearly to prevent legal issues from arising. Below are key points and steps necessary for drafting a house buying or renting contract in Canada:
- Details of the parties to the contract
- Property details
- Price and payment terms
- Specify who is responsible for paying any incidental costs
- Terms of contract termination
- Exact date of transfer of title deed and delivery of property to buyer
- Signatures of the parties and witnesses
Cost of Buying a House in Canada
Applicants when buying a house in Canada should also consider the ancillary costs, as they cannot calculate these amounts in the mortgage and must pay them out of pocket. Ancillary costs when buying a house in Canada may include tax costs, property inspection fees, municipal fees, title insurance, homeowner’s insurance, and more. Below is an explanation of each.
- Land Transfer Tax
Land transfer tax (property transfer) ranges from 0.5% to 2% of the total property value. However, Alberta, Nova Scotia rural areas, and Saskatchewan are exempt from this rule.
- Legal Fees
Legal fees can be negotiable but may in some cases reach up to 10% of the property’s value.
- Goods and Services Tax
For new homes, a 5% Goods and Services Tax (GST) is applied to the purchase price. However, GST is often included in the selling price.
- Estoppel Certificate Fee (for apartments and detached units only)
A status certificate outlines the legal and financial status of a condominium unit and its costs, typically up to CAD 100 (USD 74). This fee does not exist in the province of Quebec.
- Legal and Notarial Fees
Lawyers review the purchase offer document, investigate the seller’s credibility, prepare loan documents, and oversee the process’s details. Each party pays their lawyer’s fee separately.
- Real Estate Agent Fee
Real estate agent fees range from 3% to 7% of the property value, plus a 6% GST. The seller usually pays the agent’s commission, but in some cases, the buyer may also have to pay a portion.
Taxes on Buying a House in Canada
Taxes are set by city councils, and homeowners in this country must pay an annual tax amount to the government. In Canada, there are several taxes and costs for buying a house. One of the main taxes is the land transfer tax, which is paid by the buyer during the property transfer.
Tax calculations differ in various places and cities in Canada. Property taxes in Canada are about 15% of the property’s total value, which also varies according to the area. Note that this tax percentage applies to non-residents.
Buying a House in Canada with a Loan
Loans are provided to Canadian citizens and residents to enable them to purchase homes. These loans, which are dispensed by the government and private institutions, have specific conditions that applicants must meet. Loans can be granted in two forms: open and closed, each with its own conditions for purchase, but there are differences in repayment.
For the repayment of closed loans, over a specified period ranging from 15 to 25 years, the borrower must pay monthly installments, and in some cases, additional payment options may not be available, while the interest rate is fixed. However, for the repayment of open loans, the borrower can pay a higher amount toward the installments to the lender, resulting in lower interest paid on the loan.
Buying affordable Houses in Canada
When looking to buy an affordable house in Canada, several factors can help ensure an informed and successful purchase:
- Low-cost Location
- Property Type
- Property Condition
- Knowledge of Real Estate Market Conditions
- Thinking About Financing Options
- Working with a Real Estate Agent
- Considering Additional Costs
Buying Land in Canada
When buying land in Canada, there are several important factors to ensure a successful purchase. Be aware of zoning laws and land use restrictions in the area where you intend to purchase land. Zoning laws determine the use of land, such as residential, commercial, agricultural, or industrial purposes.
Consider the land’s location—proximity to amenities, transportation, schools, and essential services. Set a clear budget and explore financing options. Remember additional costs like property tax, legal fees, land transfer tax, and development expenses.
If developing, check building permits, zoning rules, and restrictions. Align your purchase with long-term goals and assess the land’s potential resale value.
Buying Commercial Real Estate in Canada
Commercial properties in Canada include shopping centers, grocery stores, office buildings, manufacturing shops, and many others. Purchasing commercial property in Canada is typically recognized as a valuable investment. Applicants intending to buy property in Canada can invest in commercial properties.
The average apartment price in Canada is around CAD 400,000, varying by size, location, and amenities. Toronto, a top city to live in, had an average house and apartment price of CAD 832,703 in 2021. The cheapest houses in Toronto start at about CAD 400,000, usually located outside the city center and may require some construction completion.
Buying a Farm in Canada
Another way to buy property and invest in Canada is by purchasing a farm. Ontario province, due to its good climate and beautiful nature, has many farms. Canada has suitable land for growing agricultural products and has excellent weather for raising animals and growing agricultural lands.
- Farm prices in Canada
Here, we will introduce the prices of farms in various provinces of Canada. In the table below, you will see the price per hectare of farmland in some provinces of Canada:
| Province | Price per Hectare (USD) |
|---|---|
| Canada (Average) | $3,417 |
| Newfoundland and Labrador | $5,653 |
| Prince Edward Island | $4,227 |
| Nova Scotia | $2,359 |
| New Brunswick | $2,865 |
| Quebec | $6,910 |
| Ontario | $11,905 |
| Manitoba | $2,281 |
| Saskatchewan | $1,601 |
| Alberta | $3,008 |
| British Columbia | $6,537 |
The Best Places to Buy a House in Canada
Canada’s real estate market offers numerous investment opportunities for both domestic and international investors. With a stable economy, diverse cities, and strong housing demand, investing in Canadian real estate can be a profitable investment. Below are some profitable cities in Canada that have favorable conditions for property purchases.
- Toronto
- Quebec
- Vancouver
- Ottawa
- Montreal
The Best Sites to Buy a House in Canada
Individuals looking to invest in Canada and purchase a house face one of the most important steps, which is finding a home. One of the best ways to find a suitable house in Canada is through the MLS service website, which now operates under the name Realtor.ca.
Here is a list of the best Canadian sites to find a home.
Essential Recommendations Before Buying Property in Canada
Buying a house in Canada is a significant financial decision that requires thorough examination and proper planning. The following key recommendations are provided to ensure a successful and cost-effective purchase in Canada:
- Accurate budgeting and financial capacity review
- Choosing the right city and neighborhood
- Reviewing the housing market situation
- Consulting with a reputable real estate agent
- Reviewing the legal status of the property
- Visit the property and examining its physical condition
Services of Malekpour Institute Regarding Property Purchase in Canada
Malekpour Institute is ready to provide services regarding property purchase in Canada, studying in Canada, investing in Canada, and also work visa in Canada. Utilizing the knowledge of international lawyers, Malekpour Institute will always have the best and most optimal offers for you.
If you wish to obtain residency through property buying, you can proceed with the property purchases in Portugal, Spain, Cyprus, Greece, and Hungary, and you can also benefit from the assistance of professional consultants from Malekpour Immigration Institute.
Investment Standards in Canada for Property Purchase
When discussing the risk of property confiscation in Canada, global statistical organizations and charts indicating this country’s economic growth reveal that Canada has a significant level of security, and only in the charts will the number one represent an indicator that denotes greater security. Therefore, individuals who seek to buy property and invest in Canada can confidently proceed with property purchases, even with government loans.
Additionally, in Canada, judicial corruption and nepotism in comparison to justice are very low, and such laws are quite rare and specific.
Frequently Asked Questions Regarding Property Purchase in Canada
- Is it possible for foreign nationals to obtain Canadian residency through buying property?
Unfortunately, this method is not considered an immigration option in Canada and is only a way to invest in Canada.
- Can one obtain a loan for purchasing a house in Canada?
If you do not have residency in this country, you cannot obtain a loan for property purchase in Canada.
- Can one obtain residency in Canada through buying a house or apartment?
Purchasing property in Canada does not grant residency, and to obtain residency, one should pursue investment or entrepreneurship programs.
- Is the cost of buying property in Canada different for Canadian residents and non-residents?
The cost and price are the same, but the difference lies in the payment methods. Non-residents must pay about 35 percent of the total amount at the beginning of the process.
Conclusion:
We have examined the process of buying property in Canada and the possibility of obtaining residency in Canada through property purchase, the price of houses in Canada in Tomans, the process of property acquisition, and other important aspects to know when buying property in Canada in this article.
Therefore, if Canada is your preferred country for immigration, you can contact Malekpour Institute and benefit from the knowledge of experienced consultants in your journey to immigrate to Canada. You can also pose your questions regarding house prices in Canada in the comments section so that the institute’s experts can respond to you.
