Canada’s Foreign Buyer Ban in Short

Today the Government of Canada released its official regulation governing the ban on Foreign Buyers from purchasing residential real estate in Canada. This regulation goes into effect January 1st, 2023, and will remain in effect for 2 years unless the Federal Government decides to extend it. This ban applies to Census Metropolitan Areas (CMAs) as well as Census Agglomerations (CAs).

Does Canada’s Foreign Buyer Ban Apply to Whistler, Squamish, or Pemberton Real Estate?

What does this mean for our markets and our clients? Well, first of all, neither Whistler nor Pemberton are on the official Statistics Canada list of Census Agglomerations. Pemberton is too small to qualify, and Whistler seems to have other factors which disqualify our Resort Municipality from being included as a Census agglomeration. Thus, property purchases in Whistler and Pemberton appear at this time, to be exempt from Canada’s Foreign Buyer Ban. Squamish IS a Census Agglomeration, and is thus included in the Foreign Buyer Ban. Starting January 1st, 2023, Foreign persons and entities will be barred from purchasing property with residential zoning in Squamish, British Columbia.

Other Exemptions to Canada’s Foreign Buyer Ban

There are exemptions for people with certain temporary statuses in Canada, and they are quite restrictive. If you are here on a student or work permit, there may be things you can do to purchase property, but a lot of these things are along the lines of filing taxes here for a number of years, etc. As a person who initially came to Canada on a student permit (22 years ago!), I decided that I definitely wanted to stay. If this describes your situation, but you’re not quite ready to buy, it’s best to plan ahead! Give us a call and we can help figure out a course of action for those of you readers who want to make a life here.

There appears also to be an exemption for vacant land with residential zoning. (We’re assuming the Federal Government did this because they don’t want to prohibit foreign developers from creating housing!) So, if you are interested in vacant land in a CMA or CA, we can discuss navigating those purchases as well. There are also exemptions for acquisition of property through death, divorce, separation or gifting, as well as the exercising of a security interest, or right of a secured creditor (foreclosure). If you have any questions about this, we can point you in the right direction.

What Does Canada’s Foreign Buyer Ban Mean for Whistler, Squamish, and Pemberton Real Estate?

So, what does all of this mean for our markets? This likely won’t mean a whole lot in Squamish. There are not a lot of foreign buyers purchasing individual residences there. If there were foreigners who purchased several units in condo buildings for example to rent out, there is almost no vacancy and returns on investment are probably enough that any foreign influence on the market will be made up for by Canadians. Interest rates will have a greater effect on pricing in Squamish.

For Whistler, as one of the most desirable places in Canada with proximity to Vancouver, with foreign purchases making up 10% to 15% of our market, we may expect an increase in foreign buyers, as they cannot purchase in the Greater Vancouver area. Our luxury properties may be particularly affected if people want to move their money and cannot put it into Vancouver real estate. An increase in foreign buyers may even help buoy Whistler’s prices from the expected downturn – we’ll have to see how it pans out and as always, we’ll keep all of our clients up to date!

Pemberton is a bit of a wild card. Statistically, Pemberton does not have a history of foreign buyer influence on that market. It may however see a residual increase in foreign buyers as a bedroom community to Whistler, if foreign buyers do not have anywhere to invest.

All in all, for properties serving as primary residence homes for people, workers, and business owners in Whistler, this will not have as big an effect as interest rates. Unfortunately for the average person, interest rates are keeping many people out of purchasing in our housing market. Pressure from foreign buyers may spill over into pricing on residential (non-luxury) homes, but this may only counteract the effects of interest rate hikes and potential recession. Typically foreigners tend to make up a larger percentage of our luxury market, and we may see pricing buoyed there.

Follow our monthly stats releases as we dive into the new year and new markets to see what happens. As always, feel free to contact us to discuss your specific needs in buying or selling your Sea to Sky Property.