# Canada Plans to Allow Foreign Buyers to Purchase New Homes: What It Means for Ontario Real Estate

```yaml
title: "Canada Plans to Allow Foreign Buyers to Purchase New Homes: What It Means for Ontario Real Estate"
type: Guide
category: "Market Insights"
slug: canada-foreign-buyer-ban-new-homes-ontario
publishedAt: 2026-11-12
canonical: https://pre-construction.ca/blog/canada-foreign-buyer-ban-new-homes-ontario
location: toronto
topics:
  - closing-costs
  - what-is-pre-construction
  - hst-rebate-ontario
related:
  - closing-costs-new-home-ontario
  - toronto-pre-construction-market-reset-2026
  - what-is-pre-construction-ontario
  - two-closings-pre-construction-ontario
```

Budget 2026 proposes letting foreign buyers purchase new homes while keeping existing homes banned to 2029. See what applies today in Ontario and Toronto.

## Canonical HTML page

https://pre-construction.ca/blog/canada-foreign-buyer-ban-new-homes-ontario

## Topics

- [New-Home Closing Costs in Ontario](https://pre-construction.ca/guides/closing-costs) — Markdown: https://pre-construction.ca/knowledge/topics/closing-costs.md
- [What Is Pre-Construction in Ontario](https://pre-construction.ca/guides/what-is-pre-construction) — Markdown: https://pre-construction.ca/knowledge/topics/what-is-pre-construction.md
- [Ontario HST Rebate on New Homes](https://pre-construction.ca/guides/hst-rebate-ontario) — Markdown: https://pre-construction.ca/knowledge/topics/hst-rebate-ontario.md

## Related guides

- [New Home Closing Costs in Ontario (2026): Checklist + Calculator](https://pre-construction.ca/blog/closing-costs-new-home-ontario) — Markdown: https://pre-construction.ca/knowledge/guides/closing-costs-new-home-ontario.md
- [Toronto Pre-Construction in 2026: The Shift to End-User Homes & Builder Strategy](https://pre-construction.ca/blog/toronto-pre-construction-market-reset-2026) — Markdown: https://pre-construction.ca/knowledge/guides/toronto-pre-construction-market-reset-2026.md
- [What Is Pre-Construction in Ontario? A Plain 2026 Buyer Guide](https://pre-construction.ca/blog/what-is-pre-construction-ontario) — Markdown: https://pre-construction.ca/knowledge/guides/what-is-pre-construction-ontario.md
- [The Two Closings in Pre-Construction Ontario: Occupancy vs. Final Closing](https://pre-construction.ca/blog/two-closings-pre-construction-ontario) — Markdown: https://pre-construction.ca/knowledge/guides/two-closings-pre-construction-ontario.md

## Frequently asked questions

### Is Canada lifting its foreign-buyer ban in 2026?

No. As of November 12, 2026, Ottawa has only tabled a Budget 2026 proposal, not passed a law. The current federal ban stays in force until January 1, 2027. Ottawa proposes extending the ban on existing homes to January 1, 2029 while adding a carve-out for new homes.

### Can foreigners purchase newly built homes in Canada?

Not broadly under current law unless an existing exemption fits, such as qualifying work-permit holders, locations outside major cities, or buildings with four or more units. Budget 2026 proposes exempting new residential properties, but Ottawa has not yet released the bill, rules, or start date.

### Can foreign buyers purchase pre-construction condos?

Right now, signing a pre-construction purchase contract counts as buying residential property under federal rules, so most non-Canadians need an existing exemption. Budget 2026 has not yet said whether its proposed exemption will cover pre-construction contracts, finished unsold condos, or both.

### What properties would remain restricted until 2029?

Under the Budget 2026 proposal, existing and resale homes would stay restricted for foreign buyers until January 1, 2029. That includes resale detached houses, semi-detached homes, townhomes, condo units, and buildings with up to three dwelling units in major urban areas.

### Does Ontario's 25% foreign-buyer tax still apply?

Yes. Ontario's 25% Non-Resident Speculation Tax (NRST) is provincial law and does not disappear under a federal budget proposal. It applies across Ontario on residential properties with one to six homes — including new builds and pre-construction condos — unless a provincial exemption or rebate applies.

### Does Toronto charge an additional 10% tax?

Yes. Inside the City of Toronto, the Municipal Non-Resident Speculation Tax (MNRST) adds another 10% on top of Ontario's 25% NRST. That makes the combined foreign-buyer tax 35% before regular provincial and Toronto land transfer taxes.

### Could the policy encourage new construction and condo sales?

It could help builders reach pre-sale targets or sell completed new units by widening the buyer pool. In Ontario, however, the real impact will depend on final federal rules and whether buyers can absorb Ontario's 25% tax and Toronto's extra 10% tax.

### How does Ontario calculate NRST on a pre-construction home?

Ontario calculates NRST on the full taxable purchase price, called the value of the consideration, not always the base sticker price. Upgrades, lot premiums, assumed development charges, and assignment markups can all raise the final tax bill at closing.

### What happens to non-resident withholding tax in Budget 2026?

Budget 2026 proposes cutting Section 116 purchaser withholding rates when foreign corporations sell taxable Canadian property on or after January 1, 2027. Rates would drop from 25% to 15% on standard capital property and from 50% to 30% on inventory. It changes closing holdbacks, not capital-gains tax rates or personal sellers.

## Publisher

Pre-Construction.ca — buyer representation for Ontario pre-construction homes.