Thinking of moving to Toronto? We can help.
There are many factors to consider when planning and preparing your move to Toronto.
To get you started, we have prepared some important information about real estate purchase by a Canadian citizen with non-residence status or prospective immigrants.
Location, location, location.
Location is the most important factor when choosing a new home. Land value is driven by demand, and demand is primarily driven by accessibility to infrastructure (i.e. schools, parks, malls, jobs), and ease of access (i.e. highways, rapid transport systems, etc). When choosing a location, ask yourself these questions:
Types of Homes
Unlike Hong Kong, Canada has a lot more options when it comes to housing. Here’s a general overview of the most common type of homes with their advantages and disadvantages.
Advantage: highly accessible | managed property | include amenities like pools and gym rooms
Disadvantage: potential noise | management fee | comparative smaller space (still a lot bigger than HK) | no private backyard
Suitable for couples and small families
Starting at 500sqft, $400,000 CAD and up (Approx. $2,400,000 HKD)
Townhouse / Semi Detach
Advantage: private backyard | garage space plus driveway | freedom to renovate
Disadvantage: potential noise (minimal) | lack of natural light | small yard
Best suited for nuclear family
Starting at 1200sqft, $700,000 CAD and up (Approx. $4,200,000 HKD)
Advantage: spacious yard | privacy | extra parking space | potential rental income
Disadvantage: higher cost | responsible to maintain property | higher property tax
Good for families of all kinds, especially for living with parents
Starting at 1500sqft, $900,000 and up (Approx. $4,200,000 HKD)
Mortgage and Finance
Mortgages are one of the best tools in keeping control over your money and maintaining liquidity, especially in times of uncertainty like immigration. Currently, Canada is experiencing some of the lowest mortgage rates in history. You need to be aware of some recent changes in mortgage policies that could make the application process challenging for non-residents. Here are two important topics you should be aware of.
Effective October 25, 2022, the Government of Ontario implemented a 25% Non-Resident Speculation Tax ("NRST") for foreign home buyers in additional to the Ontario Land Transfer Tax. This tax applies to all residential property located in the Greater Golden Horseshoe Region.
But don’t worry, under certain circumstances, this might not apply to you or you may be eligible for a rebate on the NRST.
Took effect in January 2018, home buyers are now subject to stricter qualifying criteria (also known as a "stress test"). This created an added barrier for Canadians currently living in Hong Kong but wish to purchase a home in Canada.
To overcome these barriers, first understand what type of mortgage lender best fits your means.
Logistics of Purchase
With technology, digital signatures are becoming increasingly popular, making contract completion faster and easier. However there are still some situations which require quick immediate responses where time-zone difference makes difficult, or in-person signing is still required. POA can help fill this gap. A POA he or she has the legal authority to act in specific ways for another person, such as buying or selling real estate.
How to choose a POA?
When assigning a power of attorney, you’re choosing someone to act on your behalf and to take care of your financial affairs in your absence. This person has enormous power and responsibility over your legal obligations, so when choosing your POA, besides choosing someone who you trust will act on behalf of your interest, you should also consider whether your power of attorney has the intellectual capacity and business acumen to exercise sound judgment over your investment.
Working with a Realtor
Buying or selling a home is the biggest transaction most of us will ever go through.That’s why it’s so important to be informed and take advantage of expert advice. If you decide to work with a registered real estate professional, you’ll have help navigating the buying or selling process along with the added benefit of valuable consumer protection from the Real Estate Council of Ontario (RECO).
Click here to learn more about working with a realtor.