VANCOUVER BUYERS GUIDE
Whether you are looking to purchase a 2nd home for yourself or a family member, or a vacation or rental property, we are here to guide you through the process, handling all of the details so that you can focus on finding your new home!
A non-resident, for lending purposes, is anyone who does not earn their income in Canada, and who does not file taxes in Canada.
There are no restrictions on the types of properties non-residents can purchase in Canada, nor on which country you call home.
If you are a U.S. citizen, you can purchase a property in Canada for as little as 20% down. For all other countries, it is a minimum of 35% down if you fully income qualify. This down payment must be verifiable and cannot be gifted from any source with most lenders. If you will be using gifted funds, please let me know up front as this dictates which lenders I may approach on your behalf.
Your down payment and required closing costs need to be in a Canadian institution 30 days prior to your closing date as a general rule, so you will most likely need to travel to Canada to open this account if you don’t have one already, as well as to sign with a lawyer or notary in person at closing.
Canadian mortgage lenders will want to see proof of income and/or verification of assets to confirm you can service the Canadian loan. Your international credit bureau and letter of good standing from your bank will be required as well as the normal application required of all borrowers.
The mortgage products offered to you are the same as to Canadian borrowers, although a surcharge may be added to the rate depending on your circumstance, and is generally added for all rental properties. Mortgages in Canada are generally shorter term mortgages, the most common term being five years, after which you have the option to renew again with that lender or another. The maximum amortization of the mortgage is 25 years with most lenders.
Purchases of property are subject to Property Transfer Tax, which cannot be included in the mortgage. This tax is charged at a rate of:
• 1% of the fair market value up to $200,000,
• 2% of the portion of the fair market value greater than $200,000 and up to and including $2,000,000,
• 3% on the portion of the fair market value greater than $2,000,000, and
• If the property is residential, a further 2% on the portion of the fair market value greater than $3,000,000
As a foreign national or foreign corporation, you will also be charged an additional 20% property transfer tax if the property is located in the:
• Greater Vancouver Regional District
• Capital Regional District
• Fraser Valley Regional District
• Regional District of Central Okanagan
• Regional District of Nanaimo
A Speculation and Vacancy Tax of 2% for foreign owners and satellite families has been introduced in B.C. to turn empty homes into housing for British Columbians, and ensure foreign owners and those with primarily foreign income contribute fairly to B.C.’s tax system. This applies in the following areas:
• Capital Regional District
• Metro Vancouver Regional District
• City of Abbotsford
• District of Mission
• City of Chilliwack
• City of Kelowna
• City of Nanaimo
• District of Lantzville
If the property purchased is in the city of Vancouver, it will be subject an Empty Home Tax of 1% of the value annually if it is not a principal residence and not rented for at least six months of the year.
Our team will help you from first call or email through to following up with your lawyer at closing to ensure your home buying experience is a smooth and a happy one!
Please call 604-996-7701 or email me personally for help on how to start down the path of home ownership in Canada!