Federal government to exempt new homes from Canada's foreign buyer's ban | Daily Hive

Federal government to extend Canada's foreign buyer's ban to 2029 while exempting new homes

Construction crane for a new Vancouver residential building. (Lijuan Guo/Shutterstock)

Prime Minister Mark Carney’s administration is proposing to exempt new residential properties from Canada’s foreign homebuyer ban, while extending the current restrictions on purchases of existing homes for another two years, to Jan. 1, 2029.

The changes are outlined in the 2026 federal budget released this afternoon. The federal government’s approach would encourage investment in new housing while preserving access to existing homes for Canadians.

The ban is currently scheduled to expire on Jan. 1, 2027. Under the proposal, it would continue to apply to existing and resale properties, subject to applicable exemptions, while new residential properties would be exempt.

“This would help protect housing affordability by keeping the vast majority of the market available for Canadians, while unlocking additional investment in new housing supply,” reads the budget document.

“We will continue to support a range of policy measures, such as those levied by other levels of government, which address housing market pressures, including speculation. The federal government will propose legislation and launch a regulatory process on this change in short order.”

The budget does not outline the detailed eligibility rules or an effective date for the new-home exemption.

You might also like:

As a housing affordability measure, the ban first took effect on Jan. 1, 2023, initially for two years. In early 2024, the federal government subsequently extended it to Jan. 1, 2027.

Under the existing rules, the ban generally prevents non-Canadians from buying certain residential properties in urban areas, including detached houses and condominium units. Canadian citizens and permanent residents are not subject to the ban, while exemptions allow some temporary residents and other eligible buyers to purchase homes.

The measure was first introduced at a time when Canada’s housing market was seeing a major upswing after the initial pandemic slump, resulting in record-high increases to home prices and rents. At the time, Canada was also experiencing substantial surges in population growth due to the federal government’s heightened immigration targets.

The federal foreign buyer’s ban was seen as a way to curb foreign demand and help keep homes available for people living in Canada.

There also appears to be broad public support for the ban, based on a national survey in April 2025 by Vancouver-based polling firm Research Co. It found that 76 per cent supported the federal government’s policy, while 13 per cent opposed it and 11 per cent were undecided. Support crossed party lines: 82 per cent of respondents who voted Conservative in the 2021 federal election backed the ban, along with 78 per cent of both Liberal and NDP voters in that election.

However, assessments of the ban have raised questions about its effectiveness and whether it should remain in place, particularly given current housing market and economic conditions and the changes to immigration targets. Some developers have also expressed concerns about its impact on their ability to secure financing for new housing projects.

The proposed extension comes as some developers — particularly in Metro Vancouver and Greater Toronto — in the past two years have been urging the federal government to loosen the ban, arguing that foreign buyers could help clear unsold condominiums and provide the pre-sales needed to finance construction for the next round of new housing projects in future years.

Some developers have also called on the federal government to create new exemptions for new pre-sale homes, as well as homes in new mid-rise and high-rise building projects.

In more recent months, there have been requests from the real estate and development industry to simply let the existing ban expire naturally on Jan. 1, 2027.

Meanwhile, Metro Vancouver’s new condominium market is struggling with weak sales and unsold inventory. The Fall 2026 market report by Rennie counted more than 14,000 unsold new condominium units at the end of June 2026, spanning projects before construction, under construction, and completed. Just 1,340 new condominium units were sold in the first half of 2026, which is a record low for the region.

Condominium developers in both Metro Vancouver and Greater Toronto are increasingly turning to bulk purchases to unload their unsold inventory.

Condominium prices and sales remained below year-earlier levels across B.C.’s Lower Mainland in October 2026. In Greater Vancouver Realtors’ area, the condominium benchmark price was $673,400, which is down 5.9 per cent compared to October 2025, while sales fell 16.7 per cent to 892 units. In Fraser Valley Real Estate Board’s jurisdiction, which includes the major Metro Vancouver areas of Surrey and Langley, the condominium benchmark price was $460,800, which is down 8.1 per cent compared to October 2025, while sales dropped 20.1 per cent to 238 units.

You might also like: