An end to Canada's foreign homebuyer ban? Don't count on it

  3/4/2026 |   SHARE
Posted in Foreign Buyers by Vanguard Realty | Back to Main Blog Page

As home prices spiked during the COVID-19 pandemic and competition surged in the housing market, the Trudeau government announced it would clamp down on speculative activity by banning non-resident foreign buyers from snapping up homes.

In 2024, that ban was extended – and it was renewed once again last year, meaning under the current arrangement foreign buyers who don’t live in Canada will be unable to purchase a property here until at least the beginning of 2027.

In the years since that policy was introduced, the housing market has seen its fair share of twists and turns, particularly in homebuying hotspots like Toronto and Vancouver where purchasing has plunged amid a jump in interest rates and continuing affordability challenges.

Also playing its part in the housing market’s downturn – particularly in those cities’ condo sectors – has been a dramatic reduction in the federal government’s targets for new permanent residents in the years ahead, stymying rental and purchase demand.

The ever-rising glut of empty condos in Toronto has sparked questions over whether the government might revisit its ban on non-resident foreign buyers to arrest the market’s ongoing slump.

And while there seems little chance of the government upping its immigration quota anytime soon, housing market experts see a better prospect of policymakers revisiting the ban on foreign buyers – especially as a bargaining chip in the upcoming Canada-US-Mexico Agreement (CUSMA) review.

“I never liked that [ban] in the first place,” Dan Eisner, founder and chief executive officer of True North Mortgage, told Canadian Mortgage Professional. “I always thought that was a bit unfair.

“Could I see it being reversed? Quite possibly. With all the trade negotiations going on right now, that’s definitely something that could [be changed].”

‘Would it move the market substantially? I don’t think so’

Removing the current policy could pose challenges for prime minister Mark Carney’s government because it would likely reintroduce more competition for first-time buyers already struggling with affordability.

But Eisner said scrapping the ban and allowing non-resident foreign buyers to purchase property in Canada wouldn’t necessarily move the needle much in the housing market.

That’s because foreign buyers living outside Canada would overwhelmingly be investors – and a condo purchase in Toronto makes as little sense for that segment of the market as it currently does for investors who live in the country.

Prices have been on a months-long slide in the Toronto condo space, with many buyers reportedly sitting on the sideline as they wait to see just how far they still have to fall.

For Eisner, that would also be an important consideration for investors who aren’t living in Canada. “Would it move the market substantially? I don’t think so, because people are looking at Canada and saying, ‘Is this a good place to get into the housing market?’” he said. “Over the last few years, I don’t know if the answer to that would be ‘yes.’

“So even if it was reversed, I don’t think that would cause the housing market to pick up substantially. They’re going to look at, ‘Why buy now? Why not buy in six months? Why not buy in a year?’”

Canadians overwhelmingly support foreign buyer ban

A key factor that could convince the government to keep the ban in place even amid the flailing housing market: a strong majority of Canadians favour the policy and want to see it continue.

A 2025 poll by Research Co. showed around 76% of Canadians support the ban, with consensus across party lines. The policy is supported by 82% of Conservative voters, 78% of Liberal voters, and 78% of New Democratic Party (NDP) supporters.

The strength of that support raises an important question for the government – namely, whether it’s worth alienating Canadians in an effort to revive the housing market, especially when plenty would rather see prices continue to fall.

That means investors desperate to sell their cashflow-negative property shouldn’t count on the federal government throwing them a bone by ending the foreign buyer ban – especially if the property in question is one of the now-notorious so-called “dog crate” condos in Toronto.

“I think they’ll struggle,” Eisner said. “They’re going to be the last ones to be bought and the first ones to be listed.”

Source: Canadian Mortgage Professional

Foreign Buyer Ban Canada, Foreign Buyers, Foreign Investors