Canada is a top destination for expats moving from South Africa – and the good news for those that are moving there is that it has been voted as one of the most welcoming countries in the world, with a very tolerant attitude towards all foreigners. Expats who move to Canada often do so for the long-term and after renting for a while, many expats want to own their piece of Canadian property – to help you on your way, here is a quick guide to property purchase in Canada:
Guide to purchasing property in Canada
Equal rights for all
Purchasing property in Canada is very easy for expats, and non-residents have the same rights of ownership as residents and citizens of Canada. Canada has an open-door policy when it comes to foreign property ownership and what’s more, Canadian housing property prices are more reasonable than many of the other top expat global destinations.
Financial options available
If you require a mortgage, you need to apply directly to a bank and provide personal information, which includes assets/liabilities, income verification, tax returns and credit information. Foreign banks can’t register mortgages in Canada – so a mortgage needs to be raised by a local Canadian mortgage broker or bank.
In general the Canadian mortgage system is quite safe and solid with tight regulations and supervision. The banks are not allowed to offer the risky mortgage structures that happened across the border in the USA. Underwriting standards are also high in Canada, and that possibly explains a very low rate of default.
The purchasing process
The purchasing process in Canada is the same across all provinces and the transfer process usually takes between 60 and 90 days. If the property is vacant, it could be completed within a month. To help with the buying process, it is a good idea to get a pre-qualified mortgage from the bank, so you know exactly how much you can afford. Having your mortgage pre-qualified also helps cut down on the purchasing time as you can make a solid, realistic offer almost immediately.
As a buyer, it is important to be aware that property transfer tax is paid by the buyer at one percent of the first 100 000 CAD and two percent on the balance. You may also be liable for inspection fees, if these have not been undertaken by the seller, insurance costs and closing legal fees.
Places to live
Canada is a huge country and if you’re not tied down to a particular city for your career, you have lots of options. One of the top considerations for people buying in Canada is what the weather is like in a particular region – as certain areas in Canada have extreme weather conditions. It is generally regarded the large cities of Vancouver and Toronto are the most expensive cities in which to buy property, however there are many other cities to choose from such as Calgary, Montreal and Ottawa.
Cash in your SA Retirement Annuity to assist with your purchase
If you are living in Canada, you are eligible to cash-in your South African retirement annuity, even before the age of 55. The only proviso is that you have financially emigrated from South Africa. Financial emigration does not change your status as a South African. You and your partner will still have South African citizenship and your South African passports. What’s more, financial emigration can take place at any time – on your exit from South Africa or many years after you have chosen to live abroad.
At FinGlobal we have simplified the financial emigration process for thousands of South Africans living abroad and have helped them cash in their retirement annuities so they can make the most of their retirement abroad. To find out more about how we can assist you with this process, contact us today.