The prohibition ends on 1 January 2027 — section 237(2) of the Budget Implementation Act, 2022, No. 1 as consolidated sets the repeal at the fourth anniversary of 1 January 2023, amended by S.C. 2024, c. 17, s. 149. It catches less than people assume. It applies only inside census metropolitan areas and census agglomerations — property outside them is prescribed and so is not “residential property” at all. Vacant land has not been caught since 27 March 2023, when SOR/2023-66 repealed the provision that brought it in. And the definition covers buildings of not more than three dwelling units, so a fourplex is outside it. Exceptions cover qualifying students, work permit holders with 183 days remaining, protected persons and purchases with an eligible spouse. The penalty is a fine of up to $10,000 and it reaches anyone who knowingly counsels, induces, aids or abets.
The foreign buyer ban is the most misdescribed law in Canadian real estate. Two things about it are almost always got wrong, and both of them are the difference between a legal purchase and a $10,000 fine.
One: the prohibition applies only inside census metropolitan areas and census agglomerations. Property outside them is not caught at all. Two: since 27 March 2023 vacant land is not caught either, anywhere. And a third, for anyone in my business: the $10,000 fine reaches “every person or entity that counsels, induces, aids or abets” a prohibited purchase — which means the agent, not just the buyer.
When it ends: 1 January 2027
The Prohibition on the Purchase of Residential Property by Non-Canadians Act came into force 1 January 2023. It is repealed by section 236 of the Budget Implementation Act, 2022, No. 1, and section 237(2) as currently consolidated says that repeal “comes into force on the fourth anniversary” of that date.
So the prohibition ends on 1 January 2027. The Act as originally enacted said “second anniversary”; the change came from S.C. 2024, c. 17, s. 149, and only the consolidated version shows it.
Two cautions. First, CMHC’s own FAQ page — last updated 3 March 2023 — still says the prohibition is “in effect for a period of 2 years”. That is superseded. Do not use CMHC for the expiry date. Second, as at the consolidation current to 21 June 2026 there is no instrument extending it past 1 January 2027. That is an absence, not a guarantee — and it is now under four months away, so check before you rely on it.
What is “residential property”
Section 2 of the Act defines it as, in substance:
- a detached house or similar building containing not more than three dwelling units, with the land reasonably necessary for its use; or
- a semi-detached house, rowhouse unit, residential condominium unit or similar premises that is or is intended to be a separate parcel;
— but expressly “other than a prescribed real property or immovable”. A “dwelling unit” is one with private kitchen facilities, a private bath and a private living area.
Read the unit count carefully: a building with four or more dwelling units is not caught at all. CMHC says so in terms — the Act “doesn’t prohibit the purchase of larger, multi-unit buildings containing 4 or more dwelling units”. A fourplex is outside the ban; a triplex is inside it.
The census-area carve-out, and why the mechanism matters
Section 3(1) of the regulations: a property located in an area “not within either a census agglomeration or a census metropolitan area is a prescribed real property or immovable”.
This is not an exception to the prohibition. It works through those words “other than a prescribed real property” in the opening of the definition. Property outside a CMA or CA is prescribed, so it is not “residential property” at all, and section 4(1) never engages.
The correct statement is therefore: the prohibition applies only inside census metropolitan areas and census agglomerations. Recreational and rural property outside any of them sits entirely outside the Act. The boundaries are Statistics Canada’s, from the Standard Geographical Classification (SGC) 2021.
Vacant land: caught, then released
As originally made, section 3(2) pulled vacant residential land into the Act — land with no habitable dwelling, zoned residential or mixed use, inside a CMA or CA.
SOR/2023-66 repealed that subsection effective 27 March 2023. Since then vacant land is not caught, whether or not it is zoned residential and whether or not it is inside a census area. Anything written in the first three months of 2023 is describing a rule that no longer exists.
Who is exempt
| Category | Condition |
|---|---|
| Temporary residents — students | Enrolled at a designated learning institution; filed returns for each of the five preceding taxation years; physically present at least 244 days in each of the five preceding calendar years; purchase price not over $500,000; not more than one property |
| Temporary residents — work permit holders | 183 days or more of validity remaining on the permit or authorization at the date of purchase; not more than one property |
| Protected persons | Within the meaning of the Immigration and Refugee Protection Act |
| Purchasing with a spouse or partner | Where that spouse or common-law partner is a citizen, a registered Indian, a permanent resident, a qualifying temporary resident or a protected person. Common-law requires cohabiting in a conjugal relationship for at least one year |
| Prescribed classes | Diplomatic and consular passport holders; certain people granted status for safe haven from conflict; those whose refugee claim has been found eligible and referred |
| Pre-existing agreements | Where the non-Canadian became liable under an agreement of purchase and sale before 1 January 2023 |
Note that the work-permit branch was relaxed in 2023: SOR/2023-66 repealed the former condition requiring tax filing and employment history.
For corporate buyers, “control” means direct or indirect ownership of shares or interests representing 10 per cent or more of equity value or voting rights, or control in fact. That threshold was raised from three per cent by SOR/2023-66.
The penalty, and who it reaches
Section 6(1) is worth reading slowly:
“Every non-Canadian that contravenes section 4 and every person or entity that counsels, induces, aids or abets or attempts to counsel, induce, aid or abet a non-Canadian to purchase, directly or indirectly, any residential property knowing that the non-Canadian is prohibited … is guilty of an offence and liable on summary conviction to a fine of not more than $10,000.”
Under section 6(2) an officer, director, agent or senior official who directed, authorised, assented to, acquiesced in or participated in the offence is a party to it, whether or not the corporation is prosecuted.
The sale is still valid. Section 5: “The contravention of section 4 does not affect the validity of the sale.” But under section 7 a superior court may, on a conviction and on the Minister’s application, order the property sold — and section 8(2) requires that no non-Canadian receive from the proceeds more than the purchase price they paid. The waterfall in the regulations puts costs of sale and unpaid fines first, then other entitled parties, then the buyer up to their purchase price, then anything remaining to the Receiver General. Any appreciation goes to the Crown.
The five questions that resolve almost every case
- Is the property inside a census metropolitan area or census agglomeration? If not, the Act does not apply.
- Is it vacant land? If so, not caught since 27 March 2023.
- How many dwelling units? Four or more is outside the definition.
- Does an exception apply — work permit with 183 days remaining, qualifying student, protected person, purchase with an eligible spouse?
- Is the agreement dated before 1 January 2023?
And one more for anyone advising: the fine attaches to knowing assistance. If you are not sure of the answer, that is a question for an immigration or real estate lawyer before the offer, not after.
Not sure whether the ban applies to a purchase?
Most of the time the answer turns on three checkable facts: whether the property is inside a census area, how many dwelling units it has, and which exception the buyer might fall in. I will walk through those with you honestly, including telling you when the answer is not clear enough to proceed without a lawyer. That last part matters here more than usual, because the fine in section 6(1) reaches the people advising, not only the buyer.
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Frequently asked questions
When does the foreign buyer ban end?
On 1 January 2027. The prohibition is repealed by section 236 of the Budget Implementation Act, 2022, No. 1, and section 237(2) as currently consolidated provides that section 236 comes into force on the fourth anniversary of the day the Act came into force, which was 1 January 2023. The Act as originally enacted read second anniversary; the extension came from S.C. 2024, c. 17, s. 149, and only the consolidated version shows it. As at the consolidation current to 21 June 2026 there is no instrument extending it further, but that is an absence rather than a guarantee.
Does the foreign buyer ban apply outside cities?
No. Section 3(1) of SOR/2022-250 provides that a property located in an area not within either a census agglomeration or a census metropolitan area is a prescribed real property. Because the definition of residential property in section 2 of the Act expressly excludes prescribed property, such a property is not residential property at all and the prohibition never engages. The prohibition therefore applies only inside census metropolitan areas and census agglomerations, as defined in Statistics Canada’s Standard Geographical Classification 2021.
Does the ban apply to vacant land?
Not since 27 March 2023. As originally made, section 3(2) of the regulations prescribed vacant land with no habitable dwelling that was zoned residential or mixed use and located within a census area, bringing it within the Act. SOR/2023-66, section 3 repealed that subsection effective 27 March 2023. Vacant land is now outside the Act regardless of zoning or location. Anything written in the first three months of 2023 describes a rule that no longer exists.
Can a non-Canadian buy an apartment building?
The Act does not prohibit it where the building has four or more dwelling units. The definition of residential property in section 2 covers a detached house or similar building containing not more than three dwelling units, and separately owned units such as semi-detached houses, rowhouse units and residential condominium units. CMHC states expressly that the Act does not prohibit the purchase of larger, multi-unit buildings containing four or more dwelling units. A dwelling unit is defined as a residential unit containing private kitchen facilities, a private bath and a private living area.
What are the exceptions to the foreign buyer ban?
Section 4(2) of the Act excepts temporary residents satisfying prescribed conditions, protected persons, and a non-Canadian purchasing with a spouse or common-law partner who is a citizen, registered Indian, permanent resident, qualifying temporary resident or protected person. Under section 5 of the regulations, a student must be enrolled at a designated learning institution, have filed returns for each of the five preceding taxation years, have been physically present at least 244 days in each of the five preceding calendar years, be purchasing for not more than $500,000, and not have purchased more than one property. A work permit holder must have 183 days or more of validity remaining and not have purchased more than one property. Section 6 prescribes further classes including certain diplomatic passport holders and people whose refugee claim has been found eligible and referred. Section 4(5) excludes purchases where the non-Canadian became liable under an agreement before 1 January 2023.
What is the penalty for breaching the foreign buyer ban?
A fine of not more than $10,000 on summary conviction. Section 6(1) applies it both to the non-Canadian and to every person or entity that counsels, induces, aids or abets, or attempts to, knowing the purchase is prohibited — which reaches advisers including real estate agents. Section 6(2) makes officers, directors, agents and senior officials who directed, authorised, assented to, acquiesced in or participated in the offence parties to it. Section 5 provides that a contravention does not affect the validity of the sale, but section 7 allows a superior court, on conviction and on the Minister’s application, to order the property sold, and section 8(2) requires that no non-Canadian receive more from the proceeds than the purchase price they paid.
What counts as control for a corporate buyer?
Under section 1 of SOR/2022-250, control means direct or indirect ownership of shares or ownership interests representing ten per cent or more of the value of the equity or carrying ten per cent or more of the voting rights, or control in fact whether directly or indirectly through ownership, agreement or otherwise. That threshold was raised from three per cent by SOR/2023-66.
Related reading
- The Underused Housing Tax is gone — but not for 2022 to 2024
- Bare trusts and T3 reporting: where it stands now
- Turning your home into a rental: the section 45(2) election
- Renting out property as a non-resident: the 25% trap
Sources
Every figure on this page traces to one of these, and each was read on 1 September 2026. Primary sources only — statute, regulation, and the government or agency that administers the rule. Where I could not verify something from a primary source, the page says so instead of guessing.
- Prohibition on the Purchase of Residential Property by Non-Canadians Act, S.C. 2022, c. 10, s. 235. Justice Laws Website, consolidation current to 21 June 2026. Section 4(1) prohibits a non-Canadian from purchasing residential property. Section 5 provides that a contravention does not affect the validity of the sale. Section 6(1) makes it an offence punishable on summary conviction by a fine of not more than $10,000, and extends to every person or entity that counsels, induces, aids or abets a non-Canadian to purchase knowing the purchase is prohibited. Section 7 allows a superior court, on application of the Minister and following a conviction, to order the property sold. Accessed 1 September 2026.
- Prohibition on the Purchase of Residential Property by Non-Canadians Regulations, SOR/2022-250. Justice Laws Website, current to 21 June 2026, last amended 27 March 2023. Section 3(1) prescribes property located outside a census agglomeration or census metropolitan area, which removes it from the definition of residential property altogether. Section 3(2), which had brought vacant residential land within the Act, was repealed by SOR/2023-66 effective 27 March 2023. Section 5 sets the conditions for temporary residents and section 6 the prescribed classes of persons. The definition of control was raised from three per cent to ten per cent by SOR/2023-66. Accessed 1 September 2026.
- Budget Implementation Act, 2022, No. 1, S.C. 2022, c. 10, section 237. Justice Laws Website, current to 21 June 2026 and last amended 1 January 2026. As consolidated, section 237(2) provides that section 236, which repeals the prohibition, comes into force on the fourth anniversary of 1 January 2023, giving an expiry of 1 January 2027. The citation trail records the amending instrument as S.C. 2024, c. 17, s. 149; the Act as originally enacted read second anniversary. Accessed 1 September 2026.
- Government announces two-year extension to ban on foreign ownership of Canadian housing — Department of Finance Canada. Department of Finance Canada, released and modified 4 February 2024. States that the ban, currently set to expire on 1 January 2025, will be extended to 1 January 2027. The release announces the intention and does not name the legal instrument. Accessed 1 September 2026.
- Prohibition on the Purchase of Residential Property by Non-Canadians Act, frequently asked questions — CMHC. Canada Mortgage and Housing Corporation, page last updated 3 March 2023. Confirms that non-Canadians can purchase residential property located outside a census metropolitan area or census agglomeration, that the Act defines residential property as buildings of up to three dwelling units, that it does not prohibit the purchase of buildings containing four or more dwelling units, and that as of 27 March 2023 the prohibition does not apply to vacant land. Caution: the page still describes the prohibition as being in effect for two years, which was superseded by S.C. 2024, c. 17, s. 149. Do not rely on it for the expiry date. Accessed 1 September 2026.
About the author — Jatin Dua, Broker of Record
I’m the Broker of Record at RE/MAX Quantum Realty, 799 The Queensway in Etobicoke. I am not an accountant, a tax lawyer or an immigration lawyer, and nothing on this page is advice about your own position. Anything that turns on your residency, your corporate structure or your filing history goes to a professional who can see the whole picture.
What I can do is read the statute and the Canada Revenue Agency’s own material and quote them accurately, with the section number and the date the source carries. Tax rules in this area change fast and a great deal of what circulates online is describing law that has since been amended, deferred or repealed. Where that is the case, the page says so. connect@jatindua.com or 437-987-1925.