Canadian bacon
The growth in the Canadian property market may have levelled off lately, but is not expected to decline any time soon
Ultimately the bedrock of the economy has remained strong as investment and exports continued to grow while retail sales rallied. The diversity and beauty of Canada is enticing more and more investors every year, and with property that is high quality, plentiful, incredibly affordable and easy to purchase it is easy to see why.
Practically speaking the ease of purchase should not be underestimated, as quite often this is a stumbling block for many overseas buyers. Buying is relatively straightforward in Canada, with a system that is similar to that of the US and UK.
There are extra expenses that can be incurred, depending on which province you want to settle in, and it is vital to get good advice before making the final decision. As well as the usual estate agent, mortgage broker, appraisal and legal fees, not to mention surveys and mortgage insurance, you should also look out for land transfer tax - a sales tax on property, which is the responsibility of the buyer and depends on where in Canada you want to move.
As for securing a mortgage, this varies depending on your country of origin and circumstances, but there are plenty of banks that will lend money to non-resident buyers. Complete checks are made on a borrower’s credit history and income for Canadian mortgages. Proof of income and outgoings is essential and a deposit is required, along with the cost of legal fees involved in the purchase. The deposit varies from province to province, but is usually 35 percent (though can be as high as 50 percent). Repayments are made over a maximum of 25 years and must be completed before the buyer’s 70th birthday - as such life insurance is invariably a requirement of the loan.
Bear in mind that eligibility is assessed on the buyer’s current ability to pay back the money, and not on potential income generated from the property he/she is hoping to buy with the mortgage. The mortgage is also secured against the property you will be buying in Canada and not on another property of the buyer’s outside the country.
Having settled on a property, factored in all the costs (including those sneaky hidden ones) and secured a mortgage, what’s to be done next? The regulated nature of the process means it is fairly simple to move things forward.
Despite a strong Canadian dollar demand for property and the real estate market is in keen health. The sturdy economy and the influx of people moving there has meant an unabated demand for property. Added to which the value for money compared to the UK, US or France is surprisingly good, especially given the high standard of living.
That the cost of living is lower and land cheaper makes Canada a real consideration when picking that overseas property. With 38 million square miles of stunning land to fill it’s hard to imagine Canada ever getting overcrowded, and with its stunning scenery, welcoming locals and excellent investment opportunity it is evident why investors and émigrés alike are opting for this piece of paradise.
