Real estate property is an asset everyone wants to invest in, especially if you live in Canada. Owning a house in Canada is worth all the money and everything else.
But the question that arises is where to begin? And how to buy a house in Canada?
All of this can get too confusing, especially if you don’t have the right knowledge. Ignorance in such cases can be damaging.
Here’s a guide on buying a house in Canada comprising of common questions and a process brief. Keep reading to find out more.
Can Foreigners Purchase Real Estate In Canada?
Canada has always kept its doors open for immigrants and foreigners. That explains why Canada’s population has a great number of immigrants and foreigners.
Canada reserves equal rights and opportunities for both residents as well as non-residents. Likewise, Canada offers opportunities for foreigners to have property ownership.
However, keep in mind certain provinces have different policies and requirements for this.
Here’s what you need to keep in mind a few things as a foreigner looking to buy a house in Canada.
- You’re not considered as a resident if your stay in Canada is less than six months.
- In case you wish to stay longer than six months, you need to apply for an immigration
- Different states have different policies for a foreigner seeking to buy property in Canada.
- In April 2017, the Government of Ontario introduced the Non-Resident Speculation Tax (NRST), a 15% tax on the purchase of residential property in the Greater Golden Horseshoe region of the Toronto area for non-citizens or temporary residents of Canada.
How to Choose Where to Buy a House?
Canada is a beautiful country with beautiful sights. Choosing where to purchase a house in such an incredible country can be challenging.
However, your choice can be made easier. Your choice should solely be based on your preference and liking.
- Cost of living
- affordability
- Your standard of living
- Climate
- What place suits you
Process for Buying a House
Decide on What House Do You Want
The first step to buying a house would be deciding on what exactly you are looking for. What do you have in mind? Are you looking for an apartment or a townhouse? Figure out the answers to these questions before you head on a house hunt.
Keep in mind your finances and consider mortgages and how you’re willing to pay them off.
Weigh out all your options and preferences, and then make the final choice.
Look for a Realtor
After you’ve decided and sorted your finances, get in touch with a realtor. You’re more likely to find a house quicker through a credible realtor.
A realtor’s job is to interact with clients; who are either selling their property or looking to buy one. That makes them quite resourceful.
Get Mortgage
According to Canada Mortgage and Housing Corporation (CMHC), your utility bills and other costs mustn’t go over 30% of your monthly income.
Moreover, your mortgage payments and other debts shouldn’t exceed 40 % of your monthly income.
Time to Get a Real Estate Lawyer Involved
People usually get in touch with a real estate lawyer after they have finalized the property and it’s time for the paperwork. However, it’s safer and smarter to consult a real estate lawyer before that.
Be sure to get legal advice throughout the process of buying a house. Get your real estate lawyer involved at an early stage rather than at the end.
Whereas your mortgage payments and other debts shouldn’t be over 40 % of your monthly income.
What Must You Know About Mortgage?
A minimum of 5% down payment is necessary for a property in Canada. If you make a down payment of at least 20%, you’ll need mortgage default insurance. However, for that, the insurer needs to be convinced that you’d repay the payments on time.
Where non-residents are concerned, they’re only allowed to scrounge 65% of the house payment.
To get a mortgage, you could get in touch with a bank or a mortgage broker. However, a mortgage broker is a better alternate. Since they’re quite familiar with how mortgage works and they often have better options to fit you.
Non- Canadian residents need to be careful of the mortgage broker they choose since things are different for overseas buyers.
Why Must You Hire a Real Estate Lawyer?
Having a real estate lawyer on board when making an essential decision like purchasing a house is essential.
Legal guidance is crucial to make the right house-buying decision. The wrong move can make things worse.
Read also – Guide-to-Canadian-immigration
Don’t jeopardize your dream of buying a house by making the wrong decisions! Nanda & Associates can make your real estate dream come true.
Their real estate lawyers help Canadian and non-Canadian residents prepare and review their real estate paperwork. You can learn more about their real estate lawyers here.
About the Author
Samantha James is a realtor who has worked in the real estate industry for the last 25 years. She helps individuals get their dream house in Canada and refers them to real estate lawyers.
