Can I Buy Land In Canada? (Foreigner's Guide) | askBAMLand

For many foreigners, the question as to whether or not they can buy land in Canada has come up more and more in recent years.

Some of us are interested in buying land in Canada because we are interested in investment properties. Others are looking to move out of the United States and would like to own something in our neighboring northern country that we can build on, and don’t want to just rent.

You can buy land in Canada as long as you do the following:

  • hire the right people
  • prepare the correct paperwork
  • have your finances in order
  • understand the tax laws (and be prepared to pay accordingly)
  • don’t expect to gain Canadian citizenship from owning land

Land continues to be a commodity that many covet, and Canada certainly still has a lot of it. But trying to determine if purchasing land in Canada is allowed for Americans can be a bit daunting. Even if you’ve purchased land or other forms of real estate in the past, involving yourself in the real estate market in a foreign country can come with all sorts of other questions, concerns, and unpredictable situations. But, if you stay mindful of these suggestions, buying land in Canada can be very rewarding, regardless of what your intent is.

I love real estate, and land is no exception. And, as someone who has lived in other countries for extended periods of time, I have often thought about buying my own piece of land on a different country’s soil. Let’s take a closer look at what you need to do in order to buy land in Canada.

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Can I Buy Land in Canada?

We have always been fascinated by our neighbors to the north. Their lifestyle, though similar to ours in some ways, is also vastly different. Not only are the people friendly and the cost of living low, but Canada has a ton of other perks that make the idea of living there (or at least investing in property there) attractive for many of us.

Canada makes up slightly more than six percent of the world’s land mass and it’s no wonder so many of us would like to own a slice of it. Here’s how you can do it with relative ease and comfort.

1. Hire the Right People

Once you decide you may even be considering purchasing land in Canada, the first thing you should do is start figuring out which professionals you will need to employ to help make your land purchase a success.

This is similar to the process in the United States. Hiring a good real estate agent in Canada will save you tons of potential headaches and work later down the road.

Many real estate agents in Canada are well-versed in helping foreigners buy property in their country, as so many of us find the idea of living at least part of our time in Canada to be extremely appealing.

Finding someone with a strong reputation who can help you lay out exactly what will be required of you is important, particularly since you are a person purchasing land who is not a resident of the country.

A good real estate agent will clarify for you which laws may be different for you, and what types of additional paperwork, financial assets, and tax implications you are going to need to be aware of before you decide this is the right purchase for you.

In addition to that, I would highly recommend that you find a real estate agent who works specifically with expats wanting to buy land, versus property that already has a home or business on it.

Just like in the United States, there are different hoops you may need to jump through when acquiring a loan, insurance, or legal documents for a piece of property and not an already-built structure.

Real estate agents in Canada don’t have a set commission rate. Most charge somewhere between 3 and 7 percent and the commission comes out of the proceeds of the sale, meaning that the commission is calculated on whatever price you agreed to pay.

In Canada, it is also typical for the seller to pay the commission, though most of this is somewhat negotiable.

In the end, though, working with someone who knows the ends and outs of buying land in Canada, especially if you’re a foreigner, will make a big difference in your overall experience, and will guarantee that no red flags pop up later.

2. Prepare the Correct Paperwork

Making sure that you’ve obtained and prepared the correct paperwork will be easier if you are working with a real estate agent, but it’s still an imperative part of your process in order to be able to buy land in Canada.

Just like in the United States, there is a bounty of paperwork that must be done when purchasing land in Canada. From tax returns to bank statements, there are a variety of things you’ll need to have before any property will be sold to you and transferred into your name.

Land sales are oftentimes considered riskier, since you may not have as much emotionally invested in the purchase as you would if you were buying a home. For this reason, you will oftentimes see real estate agents, sellers, and bank lenders asking you for more than they would if you were buying a traditional home.

That said, there is still a lot of lands to sell in Canada, and an incentive on the part of the government to sell it.

Not only will you have paperwork to fill out in order to get a loan, but you will also have to prove your citizenship and country of origin, your financial stability, and other things, like your marital status, place of employment, current bank and asset holdings, and more.

The paperwork with any purchase can be overwhelming, but when you are buying something in a different country than yours, it can be even more complicated.

Work with a good real estate agent, as well as your tax accountant when gathering all the paperwork for the purchase of your land. You may even want to consult with a Canadian tax advisor along with your own, just to make sure there are no needed documents you are forgetting.

3. Have Your Finances in Order

Anytime you are purchasing a piece of property, you’ll want to make sure your finances are in order, but this is even more important when you are purchasing land outside of the United States.

In Canada, this is no exception.

Canada will require you to get a loan from one of their local banks – you can not use a banker in your own home state when applying for a Canadian mortgage.

Furthermore, most foreign buyers will be asked to put down at least 35% of the amount of the land purchase.

This is significantly more money upfront than what is required for purchase in our own country. But, the obvious risk ratios are understandable, and a lending bank will need more security when giving you a land purchase loan.

You will want to set up an account with the Canadian bank that writes your loan.

Other things they may ask for are your tax returns, proof of income or assets, and a Canadian credit check. (Even if you’ve recently had one done by an American company.)

But having your finances in order doesn’t just apply to getting a load for your land.

It’s important to review your other debts versus assets and make sure this purchase is one you can afford.

Just like in the United States, lenders will sometimes loan you more than what you can realistically handle. Getting comfortable with knowing what your monthly budget is, will help ensure you don’t take out a loan above your means.

You will also need to consider paying property taxes on your land, as well as other things like insurance, and if there are going to be any building or improvement costs. All these should be factored in when you decide how much land you can afford, and how it is going to affect your household budget.

4. Understand the Tax Laws and Be Prepared to Pay Accordingly

Another aspect of buying land in Canada when you’re not a Canadian is that some of the tax implications may affect you differently than they do the residents of the country.

This may not seem fair, but it is widely done and is a way for a country to lower the tax burdens on its own citizens, while also allowing people from other countries to own property on their soil.

In Canada, all property buyers are expected to pay a property transfer tax after the sale is complete. This is usually somewhere between 1 to 3 percent of the fair value of the home, building, or piece of land.

If you are a foreigner purchasing property in Canada, you can also expect to pay an additional property transfer tax of up to 20 percent of the fair value of the home, but this is only in certain areas of Canada.

Another tax that is potentially looming out there is what Canadians call the vacancy tax, which typically applies to homes that are used for vacation spots and are not occupied for most of the year.

The vacancy tax won’t affect your land if there is no home on it, and you are solely purchasing the dirt and not a livable structure. This also applies to rental properties but again, if you are only interested in purchasing a piece of land, these tax implications shouldn’t affect you.

As with anything else, make sure you understand the tax laws and how they are going to affect your purchase before you sign on the dotted line.

Along with a good real estate agent and tax advisor, you may want to consult with a property attorney before making your final decision.

5. Don’t Expect to Gain Canadian Citizenship from Owning Land

Finally, a big incentive for some buyers is that they hope their purchase of land in Canada will give them the chance to become Canadian citizens.

This is simply not the case.

Even though you can buy property in Canada and spend up to 6 months there on a visitor’s visa, gaining your citizenship by simply owning some Canadian soil is not going to get you a Canadian passport. Just like the United States, this is not a route that will help you bypass the more tedious process of citizenship.

You will need to go through the immigration process in order for this to happen, just like people who don’t own land or property in Canada who wants to have access to the country and come and go as they please.


Brittany Melling

Brittany Melling

Brittany has been in the land business since 2020 when the world was starting to shut down. Since then, we’ve sold to dozens of people from ATV weekend warriors to camping enthusiasts to retired truck drivers. Our inventory spans mostly in the western United States. We’ve been trained by experience, land acquisition courses, and hundreds of hours meeting with county assessors and clerks, zoning officials, realtors, and land investors. We’ve answered hundreds of questions from people regarding the buying and use of land.

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