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Finding, Buying and Renting for Expats in Canada

Author: Jim Newham
Submitted: December 2013

Finding Property

It is probably best to start looking for property on the internet, as you can do this while you are still at home. It will also enable you to a feel for the types and prices of property there are available. Some popular websites are given below:

The below site is also well used, though it is for property purchase only:

https://www.realtor.ca/index.aspx?cul=1

Otherwise you can use an estate agent or local newspapers. Many rental properties are advertised by means of a poster outside the building, so if you are renting it may be worth walking around likely neighbourhoods.

Renting

Most expats rent their first property, partly because price-to-rent ratios are high. Properties up for rent generally have no more than three bedrooms, and most are unfurnished.

Most tenants rent direct from the landlord rather than via an estate agent. The initial tenancy agreement is often for 12 months, after which period it generally lapses into a rolling contract, which can have either a monthly or an annual term. It is generally inadvisable to terminate your tenancy before the initial fixed term is up, as you will be liable for loss of rent plus all costs associated with finding your replacement.

Property rental is well regulated in Canada. Although rental conditions vary between the provinces and territories, property laws generally favour the tenant. A typical amount for a security deposit is only two weeks’ rent. The legal maximum is one month’s rent, except in Quebec, where deposits are forbidden. Furthermore, in some provinces, the deposit is held by the authorities not the landlord; in others the landlord is obliged to return the deposit within a (short) decreed period.

Rental agreements in Canada must include some standard information. This is designed to ensure that both landlord and tenant enjoy a degree of protection. This standard rental agreement sets out essential details such as charges and bills payable and terms of payment.

Buying property

Reflecting the health of Canada’s economy, the housing market is generally stable. Since 2009, house prices have usually increased, the most recent figures being  a gain of 2.4% in the second quarter of 2013 and 1.4% in the third.

There are no federal restrictions on non-residents buying property. Four provinces do impose limitations, though they are minor. For example in Saskatchewan, non-residents cannot own more than 10 acres of land. Note that buying a property does not grant you residence or enable you to become a Canadian citizen.

If you choose to use an estate agent (‘real estate agent’ or ‘realtor’ in North American English.) in Canada, and they cannot find you a suitable property, they will contact other agents to find one for you. Nevertheless, if you go through with a purchase, you will still be dealing with the original agent.

Once you have decided on a property and secured a mortgage, the next stage is to make an offer your prospective new home. According to Canadian law, the offer must be in writing. It is a good idea to include in it a list of all fixtures and fittings in the property that will be staying, headed ‘chattels included.’

The offer can either be firm or conditional. You might want the offer to be conditional if you have not yet found financial backing or sold your existing property. If the offer is firm, you will immediately be required to pay a 1% to 10% deposit on the property. Once you have signed a firm offer, it is legally binding. If you now decide to pull out of the purchase, you will lose your deposit and may be sued. This ensures that the practice of gazumping is not possible in Canada.

The next stage is conveyancing the property. In Quebec, this is performed by an impartial notary; elsewhere in Canada, if you are not using an estate agent, you will need to hire a lawyer. Once conveyancing is complete and all the necessary legal checks have been made, an Agreement of Purchase and Sale is signed, and the property is transferred to your name.

Note that the vendor is responsible for paying most of the fees in a house purchase. The buyer need only pay a total of 1% to 3%, as follows:

  • land transfer tax at 0.5% - 2% (nil in Alberta, Saskatchewan and parts of Nova Scotia)
  • legal fees at 0.5% - 1%

Note, however, that any estate agent, lawyer and notary fees will increase this total.

 

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