Can a Newcomer Buy a Home in Canada? 2025 Complete Guide

Who Can Buy a Home in Canada?

Canada generally allows anyone to own property — citizens, permanent residents, temporary residents, and even non-residents. However, the Prohibition on the Purchase of Residential Property by Non-Canadians Act (in effect since January 2023) restricts non-Canadians from purchasing certain residential properties.

Canadian Citizens

No restrictions. Full access to all mortgage products and first-time buyer programs.

Permanent Residents

No restrictions. Same mortgage access as citizens. Eligible for FHSA, RRSP Home Buyers' Plan, and First-Time Buyer incentives.

Temporary Residents (work/study permit)

Can buy if: you've lived in Canada for the last 3 of 4 years OR the property is under $500K. Some restrictions apply.

Non-Residents / Foreign Nationals

Generally prohibited from buying residential property in Canada until January 1, 2027 (under current law). Commercial property is unrestricted.

Mortgage Requirements for Newcomers

Getting a mortgage as a newcomer depends on your immigration status, income, and credit history:

Factor	Requirement	Newcomer Notes
Down Payment	5% (under $500K), 10% ($500K–$999K), 20%+ ($1M+)	Same as all buyers. More may be required with limited credit history.
Credit Score	680+ preferred for best rates	Some lenders accept newcomers with 12–24 months of Canadian credit
Employment	Proof of stable income	2 years employment or signed offer letter accepted at many banks
SIN	Required for mortgage	Must have a valid SIN before applying
Stress Test	Qualify at rate + 2%	Applies to all borrowers regardless of status

Newcomer Mortgage Programs

Several lenders offer dedicated newcomer mortgage programs with more flexible requirements:

RBC Newcomer Mortgage — Considers foreign credit history (from some countries) and employment letters
TD Newcomer to Canada Mortgage — Accepts newcomers within 5 years of arrival with 10% down on homes under $1M
Scotiabank New to Canada Banking Program — Mortgage with flexible credit history requirements
BMO Newcomer Program — Mortgages for newcomers with no Canadian credit history
CMHC Mortgage Loan Insurance — Insured mortgages (5% down) available to PRs and qualifying temporary residents

First-Time Home Buyer Programs for Newcomers

First Home Savings Account (FHSA)

Available to permanent residents who have never owned a qualifying home. Contribute up to $8,000/year ($40,000 lifetime). Contributions are tax-deductible. Growth is tax-free. Withdrawals for a first home purchase are tax-free.

RRSP Home Buyers' Plan

As a PR, you can withdraw up to $35,000 from your RRSP (per person, $70,000 per couple) to buy your first home. Must repay over 15 years or include in income. Requires RRSP funds be in account for 90+ days.

First-Time Home Buyers' Tax Credit

Claim a $100 non-refundable tax credit in the year you buy your home, worth up to $1,500 in tax savings. Available to PRs and citizens.

Step-by-Step: Buying Your First Home as a Newcomer

Build your credit — You need at least 12–24 months of Canadian credit history for most mortgage lenders
Save your down payment — Open a FHSA immediately to save tax-free
Get mortgage pre-approval — Talk to a bank or mortgage broker before you start house hunting
Hire a real estate agent — Choose one experienced with newcomer buyers
Budget for closing costs — Land transfer tax, legal fees, home inspection: 1.5–4% of purchase price
Make your offer — Include conditions for financing and home inspection

Foreign Buyer Tax: If you're not a PR or citizen, you may be subject to provincial foreign buyer taxes of 20–25% on top of the purchase price in Ontario, BC, and other provinces. Check your province's rules before making an offer.

Frequently Asked Questions

Can a permanent resident buy a house in Canada?

Yes. Permanent residents have the exact same home-buying rights as Canadian citizens. There are no restrictions, additional taxes, or special requirements beyond normal mortgage qualification. PRs are also eligible for the FHSA, RRSP Home Buyers' Plan, and First-Time Buyers' Tax Credit.

Can someone on a work permit buy a house in Canada?

Yes, in most cases. Work permit holders who have been in Canada for 3 of the last 4 years are exempt from the foreign buyer ban. Those who haven't been here that long may still purchase if the property is under $500,000. Check with a real estate lawyer for your specific situation.

How much of a down payment does a newcomer need in Canada?

The minimum is 5% for properties under $500,000, 10% for the portion between $500,000 and $999,999, and 20% for properties $1 million and above. Some newcomer mortgage programs may require a higher down payment (typically 10–20%) if you have limited Canadian credit history.

How long do I need to live in Canada before I can get a mortgage?

There's no strict residency minimum, but most lenders want to see at least 12–24 months of Canadian credit history. Some newcomer programs accept employment letters and foreign credit history. A larger down payment (20%+) can sometimes offset limited credit history.

What is the Foreign Buyer Ban in Canada?

The Prohibition on the Purchase of Residential Property by Non-Canadians Act (in force since January 2023) generally prohibits non-residents and foreign corporations from buying residential property in Canada. It's currently set to expire January 1, 2027. Permanent residents and qualifying temporary residents are exempt.

Can I use my FHSA as a newcomer?

Yes — if you are a permanent resident (or Canadian citizen) who has never owned a qualifying home in Canada. You must be at least 18 years old and a Canadian resident for tax purposes. You can contribute $8,000/year up to a $40,000 lifetime maximum, all of which is tax-deductible and grows tax-free.