There is good news for work permit holders who want to buy a home in Canada. On March 27, 2023, the Honourable Ahmed Hussen announced key amendments. He was then the Minister of Housing and Diversity and Inclusion. The amendments change the Regulations under the Prohibition on the Purchase of Residential Property by Non-Canadians Act. The goal is to make housing more affordable for Canadians. It also gives newcomers and businesses more room to contribute to Canada.
This post covers changes announced on March 27, 2023, so the rules may have changed since. Confirm the current version with the Government of Canada or CMHC before you act.
What the Act means for work permit holders
On June 23, 2022, Parliament passed the Prohibition on the Purchase of Residential Property by Non-Canadians Act. On January 1, 2023, it came into force. The Regulations that go with it set out the exceptions and the key terms. In short, they explain how the prohibition works in practice.
The amendments announced by the Minister expand those exceptions. As a result, non-Canadians can buy residential property in certain situations. The changes help people and families who are building a life here. They can now own a home in their community sooner. They also aim to address housing supply. For work permit holders, this was the most important update.
Who qualifies among work permit holders
One amendment lets more work permit holders buy a home to live in while working in Canada. To qualify, they need 183 days or more left on their work permit or work authorization. They must meet this on the day they buy. In addition, they must not have bought more than one residential property.
The government is also repealing the earlier rules on tax filings and past work experience in Canada. Before the change, those extra conditions kept many newcomers out. Now, the main test is the time left on the permit.
If you hold a work permit, check your permit dates first. Then, speak with a lawyer about your status before you sign an offer. A lawyer can confirm whether you fit the exception and how to document it. It is also wise to plan for the closing costs a buyer should budget for in Ontario.
Vacant land and development
Another amendment repeals the provision that applied the prohibition to vacant land. Now, non-Canadians can buy vacant land zoned for residential and mixed use. The buyer can use it for any purpose, including residential development.
The amendments also include an exception for development. This lets non-Canadians buy residential property for the purpose of development. Meanwhile, the Act already had an exception for publicly traded corporations. Now it also covers publicly traded entities formed under the laws of Canada or a province and controlled by a non-Canadian. These changes matter less to work permit holders buying a family home, but they affect builders and investors.
A higher control threshold for private companies
Lastly, the control threshold has risen from 3% to 10%. This applies to privately held corporations or entities formed under the laws of Canada or a province and controlled by a non-Canadian. It lines up with the definition of ‘specified Canadian Corporation’ in the Underused Housing Tax Act.
What the Minister said
In the words of the Hon. Ahmed Hussen:
These amendments will allow newcomers to put down roots in Canada through homeownership and businesses to create jobs and build homes by adding to the housing supply in Canadian cities. These amendments strike the right balance in ensuring that housing is used to house those living in Canada, rather than a speculative investment by foreign investors.
The Canada Mortgage and Housing Corporation (CMHC) website provides more information on the Act and the amendments to its Regulations. Here is the link: CMHC news release on the amended Regulations. You can also check the Government of Canada website for the current rules for work permit holders.
Next steps for work permit holders in Mississauga
For many newcomers, Mississauga is a natural first stop. It has good transit, schools and a wide mix of homes. For work permit holders, that mix means more choice. So, if you qualify, the next step is planning. First, get a mortgage pre-approval, because lenders have their own rules for newcomers. Next, settle on a budget and a short list of neighbourhoods.
My ten steps for first-time buyers in Mississauga can help you get organized. Above all, work with professionals who know the rules. They can help you avoid costly mistakes. And they can help you reach your goal faster.
Talk to a Mississauga real estate agent
Do you have questions about buying a home on a work permit? I am happy to help, so please reach out through my contact page or call 416 908 5600. A. Q. Mufti, Sales Representative, RE/MAX Real Estate Centre Inc., Brokerage.
Disclaimer: this article was published on 18 January 2025 and reflects the information available at that time. Interest rates, prices, and government programs change, so check the current position before acting on anything here. It is provided for information only and is not financial, mortgage, tax or legal advice. A. Q. Mufti is a registered Sales Representative with RE/MAX Real Estate Centre Inc., Brokerage, Ontario, Canada.
