Non-Residents: Buying and Selling Canadian Property
Information for Non-Residents wanting to Purchase and Sell Canadian Property
British Columbia Real Estate Association
This article provides information only, not legal advice. If you have a legal problem or need legal advice, contact us at firstname.lastname@example.org.
Non-Residents Buying Canadian Real Estate
There are no restrictions for non-residents purchasing real estate in Canada, though they may become subject to Canadian income tax laws, and will certainly encounter the following taxes on their transactions:
Property Transfer Tax (British Columbia) – The tax rate is one per cent on the first $200,000 of the property's fair market value and two per cent on the remaining fair market value. For more information, visit the Government of British Columbia’s Property Taxation Branch’s website at www.rev.gov.bc.ca/rpt.
Harmonized Sales Tax (British Columbia) – The 12% HST applies to the purchase price of newly constructed and substantially renovated homes. The government has created a rebate under which, on average, buyers of new homes up to $525,000, would not pay any more tax due to harmonization than under the old PST system, in the price of a new home. Buyers of new homes above $525,000 will be eligible for a rebate of about $26,250. For more information, visit the Canada Revenue Agency website at http://www.cra-arc.gc.ca/gncy/hrmnztn/bc/menu-eng.html.
The standard form Contract of Purchase and Sale contains this clause:
“The Property and all included items will be in substantially the same condition at the Possession Date as when viewed by the Buyer...” (Clause 8: Viewed).
If the property’s condition is different when you take possession of your property, talk to your REALTOR® and/or your lawyer as to whether the seller has breached Clause 8 of the contract.
Buyers may impose a specific obligation on the seller, for example, to make repairs or to clean the property prior to the closing. Examples could include shampooing carpets, power washing the driveway, removing garbage and unwanted items, cutting lawns, and repairing fences.
Sellers (and buyers) are obligated to keep their contractual commitments. If a contractual commitment has been breached, consider talking to your REALTOR® and/or your lawyer as to your options.
Your REALTOR® and his/her brokerage may be able to help resolve this complaint by contacting the other party’s REALTOR® or brokerage to ask for assistance or to communicate your concerns.
Note: Your REALTOR® cannot force the other party to do what they said they would do in the contract. For this, you need the assistance of a lawyer or the Courts.
Subject to clauses
Buyers may wish to make “subject to” offers for example; subject to the buyer being able to obtain financing; subject to an inspection of the property and/or subject to legal advice. Sellers can accept an offer subject to the seller being able to find another suitable property within a specified period of time or subject to legal or financial advice. The parties must act in good faith and are expected to make reasonable efforts to satisfy and remove subject clauses from the agreement.
Note: A subject clause is not necessarily an “escape clause.” If the other contracting party does not believe you have made an effort to satisfy the subject clause he/she may consider that you have breached your contractual obligations.
Deposits are most commonly held in trust by the buyer’s REALTOR®’s brokerage. Once deposit monies have been placed in the brokerage trust account they can only be removed from the trust account with the written approval of the buyer and seller. If the parties cannot agree, the real estate brokerage may pay the monies into court pending legal action that the parties may choose to take.
If you require legal advice about a contract and/or the obligations set forth in the contract, please contact us at email@example.com or by phone at 604-294-0101.
Original Article here.