American Buyers Eye Canada as the Countdown Starts on Its Foreign-Buyer Ban

Canada's federal ban on residential property purchases by non-Canadians is entering its final stretch. The Prohibition on the Purchase of Residential Property by Non-Canadians Act, in place since January 1, 2023, is set to expire January 1, 2027, and American buyers are increasingly using this year to lay the groundwork for a purchase once the door opens.

The ban currently blocks most non-Canadians from buying detached houses, townhomes and other residential properties inside census metropolitan and agglomeration areas, covering most of the country's major cities. It does not apply to recreational property outside those zones, multi-unit buildings with four or more dwellings, or commercial real estate, and it includes carve-outs for US citizens holding a valid work permit with significant time remaining. Realtor associations report that American traffic to Canadian listing websites has climbed notably this year, with buyers concentrating searches on Atlantic Canada, Quebec and other relatively affordable markets rather than Vancouver or Toronto.

Even where purchases are technically allowed, Americans face a layered cost structure that does not exist for Canadian buyers. Ontario applies a 25% Non-Resident Speculation Tax on top of standard land transfer taxes, Toronto adds its own municipal surcharge, and British Columbia levies a 20% Additional Property Transfer Tax in specified regions. Non-resident buyers are also generally underwritten at around 35% down by major Canadian banks, since lenders often cannot rely on a US credit history alone.

Legal and tax advisers who work with cross-border clients say interest is real but still cautious, since the rules governing what happens after January 1, 2027 have not been finalized and could change again before urban markets fully reopen to foreign buyers. Provinces retain the ability to layer new restrictions on top of whatever the federal government ultimately decides, meaning the ban's expiry may not translate into a simple, uniform opening.

For now, real estate professionals on both sides of the border describe 2026 as a positioning year, with serious American buyers using the remaining months to sort out financing, legal structure and target markets before competition for Canadian urban property potentially intensifies.