Canada has lengthened a ban on foreign home buyers for two additional years as the real estate market begins to show signs of a rebound, stoking concerns about the cost of shelter in cities like Toronto and Vancouver.

Prime Minister Justin Trudeau’s government acted to prohibit non-Canadians from buying residential real estate in 2022, with the measure to expire on Jan. 1, 2025. That date has now been moved to Jan. 1, 2027.

“By extending the foreign buyer ban, we will ensure houses are used as homes for Canadian families to live in and do not become a speculative financial asset class,” Finance Minister Chrystia Freeland said in a statement Sunday, adding that the government is concerned about residents being priced out of their local housing markets.

The government has carved out exemptions for non-Canadians buying vacant land or residential property for development. There are also exemptions for foreign students and people on work permits, provided they have been in the country for an extended period and have not already purchased property.

Activity in the housing market has begun to heat up recently as it becomes clearer than the Bank of Canada may be in a position to cut interest rates later this year.  

bnnbloomberg.ca