Liberals won't say if foreign homebuyer ban will be extended as renewal window narrows

Housing Minister Gregor Robertson was not available for an interview with the Star, but has previously said the government is examining approaches used in other countries, particularly Australia, where a foreign-buyer ban includes exemptions for new homes and vacant land.

A briefing note obtained through the access-to-information system says amending and extending the ban through regulations would require a public consultation process, including publication in the Canada Gazette and a period for public feedback. The note says that process “typically averages 18 months.”

That timeline would extend beyond the Jan. 1, 2027 expiry date, though the government could instead choose to introduce new legislation, a path the briefing note does not address.

The briefing note says public opinion polling shows the ban is popular, but notes that most external analyses found foreign buyers accounted for only a small share of home purchases — between two and five per cent. The note adds that foreign buyers tended to focus their spending on luxury properties.

The ban was initially set to expire on Jan. 1, 2025, but the government extended it in February 2024. Several groups representing realtors and housing developers have called for the ban to be lifted, but the government has not said whether it plans to extend it.

In a statement, Robertson’s director of communications, Jenna Ghassabeh, didn’t say whether the ban would be extended, but said the government is focused on adding more homes people can live in. 

“The government of Canada is committed to ensuring that homes in Canada are first and foremost for housing Canadian families, and not speculative investments,” she said. “Our government recognizes the need for more affordable housing, and the impact that supply has on housing affordability in many parts of the country.”

NDP housing critic MP Jenny Kwan said the government’s inaction is a clear indicator it is going to let the ban expire. 

“If your inclination is to move forward with it then you have to actually plan for that deadline,” she said. 

Kwan said even if foreign buyers were only focused on luxury units, that has a trickle-down impact and the ban should be extended. 

“There are a whole variety of different measures that the government can take to ensure first-time home buyers have a level playing field for them to get access to housing and one of those measures is to extend the foreign home-ownership ban,” she said. 

Conservative housing critic MP Scott Aitchison said the market needs certainty the Liberals are failing to provide, but said his party has always viewed the ban as nothing more than political scapegoating. 

“I don’t think that foreign buyers were really driving prices up. It was really more government charges, fees, and taxes in those high-priced markets,” he said. 

He said the ban may be popular, but that doesn’t make it good policy. 

“I’m more interested in results and I think that the generation of Canadians who’ve been locked out of housing are more interested in results than performative politics.”

Mike Moffatt, founding director of the housing think tank Missing Middle Initiative, said the Australian model could be worth considering because it would still allow investments that help finance new housing construction.

“What the ban is kind of intended to do is to stop foreign capital coming in and buying up homes. It’s a little bit different if they’re coming in providing capital,” he said. 

Moffatt said the ban probably had some small positive impact on housing affordability, but it also reflected a much different housing market than the one Canada is in today.

“I don’t think the policy was without merit, but I would think that the benefits were always overstated,” he said. “Even if this was a sensible policy in 2022, it might not make sense in 2027.”