On January 1, 2023, Canada implemented the "Prohibition on the Purchase of Residential Property by Non-Canadians Act," which aims to limit the ability of non-Canadian citizens and non-permanent residents to purchase residential property in Canada in order to alleviate the housing supply crisis. The ban was initially set to last for two years. However, on February 4, 2024, the Canadian Minister of Finance announced the extension of the ban for an additional two years, until January 1, 2027. Therefore, non-Canadians are currently prohibited from purchasing residential property in Canada until January 1, 2027.

Key Details:

Prohibited Parties:

• Non-Canadian citizens

• Non-permanent residents

• Companies controlled by foreigners

Prohibited Action:

• The purchase of residential property within Canada.

Exceptions:

Although the law imposes restrictions on non-Canadians purchasing residential property, there are several exceptions:

• Temporary Residents: Temporary residents holding a valid work or study permit may purchase residential property, provided they meet specific conditions.

• Refugees: Individuals recognized as refugees are exempt from the prohibition.

• Diplomats: Diplomats and their families, while performing their duties in Canada, may purchase residential property.

• Spouse of a Canadian Citizen: If the spouse of a non-Canadian is a Canadian citizen or permanent resident, the non-Canadian may purchase residential property.

Consequences for Violating the Law:

If a non-Canadian violates the law by purchasing residential property, they may face a fine of up to $10,000 CAD and may be required to sell the property.

Example:

Suppose a foreign national holding a valid work permit is working in Vancouver and wishes to purchase a home. According to the law, this person qualifies as a temporary resident and may purchase residential property if certain conditions are met. However, this person would still need to consider other applicable taxes, such as the foreign buyer's tax.

It is important to note that the details and scope of the law may change over time. Therefore, non-Canadians intending to purchase property in Canada should consult a legal professional to ensure compliance with the relevant regulations.

Starting on January 3, 2023, British Columbia implemented a new homebuyer protection policy known as the "Three-Day Cooling-Off Period." This policy is designed to give homebuyers three business days to carefully consider their purchase, ensuring that necessary financial and property inspections are completed, and helping to avoid impulsive or pressured decisions that could lead to unwise home purchases.

Key Points of the Cooling-Off Period:

• Duration: The cooling-off period begins the next business day after the sale agreement is signed and lasts for three days.

• Right to Cancel: During this three-day period, the buyer can unilaterally decide to cancel the transaction.

• Cancellation Cost: If the buyer chooses to cancel the deal, they must pay a compensation fee of 0.25% of the purchase price. For example, if the price is CAD 1 million, the cancellation fee will be $2,500 CAD.

Example Case Analysis:

Suppose you sign a purchase agreement on February 1, 2025 (Monday) with the seller for a house priced at $800,000 CAD. According to the rules, the cooling-off period would start on February 2 (Tuesday) and end on February 4 (Thursday). During this period, you could:

• Hire an inspector to conduct a home inspection to ensure there are no major structural issues or repair needs.

• Confirm with the bank or lender that the mortgage loan has been approved to ensure funds are in place.

• Reflect on your financial situation and assess if continuing with the purchase is still suitable for you.

If, during the cooling-off period, you decide not to proceed with the purchase, you can choose to withdraw from the transaction. However, you will need to pay a compensation fee of 0.25% of the purchase price, which in this case would be $2,000 CAD, to the seller.

Scope and Exceptions:

This rule applies to most residential real estate transactions, including properties sold directly by individuals, but certain types of properties may be exempt. Additionally, buyers can still include conditions in the purchase agreement, such as home inspections or mortgage approval conditions, to ensure additional protections beyond the cooling-off period.

This measure was introduced to establish a fairer mechanism in the real estate market, giving buyers more time to conduct necessary inspections and evaluations, thus avoiding rushed decisions. It also ensures that sellers are not at risk of losing money due to unjustified last-minute cancellations.

1. Vancouver City (Vancouver)

   Vancouver allows the construction of multi-family residential buildings with up to 6 units, but specific conditions must be met:

   • The property must be located in a zoning district that permits high-density residential use (such as RM zoning).

   • The building must comply with height, density, and design standards.

   • Adequate parking spaces and public amenities must be provided.

   Other Cities (such as Burnaby, Richmond, Surrey, etc.)

   The multi-unit housing limits in other cities may vary, typically ranging from 4 to 6 units.

   For exact regulations, it is recommended to consult the local city government’s zoning bylaws.

   Key Requirements for Building Multi-Unit Residential Properties

   Zoning Regulations:

   • The property must be located in a zoning district that allows for multi-family residential units (such as RM or RT zoning).

   • Verify with the local city government whether the construction of a 6-unit multi-family residential building is permitted.

   Building Design and Standards:

   • The building design must comply with Canadian and British Columbia building codes.

   • Each unit must have its own separate entrance, kitchen, and bathroom.

   Parking Requirements:

   • Typically, each residential unit must be provided with a certain number of parking spaces (e.g., 1 to 2 spaces).

   • The exact number of required parking spaces depends on the city’s regulations.

   Public Amenities and Green Space:

   • Multi-family residential projects may need to provide public amenities (such as green spaces or recreational areas) and meet landscaping requirements.

   Permit Application:

   • To construct or renovate a multi-family building, an application for a building permit must be submitted to the local city government and approved.

   Recommendations:

   If you plan to build a multi-family residential building with up to 6 units, it is advisable to first consult the local city government’s zoning bylaws and planning policies, or seek professional advice from an architect or planner.

   Regulations in the Vancouver metropolitan area may change over time, so it is important to check for the latest information.

In the Greater Vancouver area, particularly in Vancouver City, there are clear regulations governing the operation of short-term rentals like Airbnb. Here are the key rules:

1. Definition of Short-Term Rentals:

   • Rental Period Limitation: In September 2024, the Vancouver City Council updated the short-term rental policy, extending the definition of short-term rentals from "less than 30 days" to "less than 90 days."

   • According to the updated Vancouver City short-term rental regulations from September 2024, you cannot use your secondary property (non-primary residence) for Airbnb or other short-term rental platforms. Short-term rentals are only permitted in your primary residence, meaning you must actually live in the property and can only rent out a portion of the residence, such as a room or part of a floor.

   • If your secondary property is a detached house’s laneway house or secondary suite, these cannot be used for short-term rentals.

2. Exceptions:

   • Long-Term Rentals (over 90 days): If you want to rent out your secondary property, you can consider long-term rentals (with leases longer than 90 days), which are not subject to short-term rental rules.

   • Different Regulations in Other Areas: If your secondary property is located in other cities in Greater Vancouver (such as Richmond, Burnaby, or Surrey), the local short-term rental regulations may vary, so it’s advisable to check the specific rules for that city.

3. Permit Requirements:

   • Primary Residence Only: Only your primary residence can be used for short-term rentals. Any vacant units, secondary suites, or laneway houses are prohibited for short-term rental purposes.

   • Permit Application: All short-term rental operators must apply for a short-term rental permit. Starting from September 12, 2024, Vancouver residents can apply for permits online and obtain approval.

4. Penalties:

   • Violation Fines: If landlords fail to comply with the regulations, individual landlords may face fines ranging from $500 CAD to $5,000 CAD, while businesses could be fined up to $10,000 CAD per day.

5. Other Regulations:

   • Platform Responsibility: Short-term rental platforms like Airbnb and VRBO are required to provide data to the provincial government and must remove listings that do not display a valid permit number.

   • Enforcement Measures: Provincial enforcement units will investigate violations by individuals and companies and impose appropriate fines.