Budget 2026 and the Foreign Buyer Ban: What Changes for Fraser Valley Sellers and New-Home Buyers

Budget 2026, tabled in Ottawa on November 5, 2026, proposes two changes to Canada's foreign buyer ban: keep it on existing homes for two more years, until January 1, 2029, and let foreign buyers purchase new homes. For a Fraser Valley owner thinking about selling a house and moving to something smaller, the first change matters more than the second. For anyone buying new, the bigger savings come from tax rules that are already law.

This guide explains the proposal in plain words, what it changes for sellers, and what a new condo or townhouse costs in tax for a downsizer and for a first-time buyer. It is general information. Before you sign anything, confirm your own case with your lawyer or notary and your accountant.

What did Budget 2026 propose?

The passage is in Chapter 3 of the Budget 2026 document. It reads:

"Budget 2026 proposes to extend the ban on foreign purchases of existing residential properties for two years, to January 1, 2029, while exempting new residential properties. This would help protect housing affordability by keeping the vast majority of the market available for Canadians, while unlocking additional investment in new housing supply."

The same paragraph says the federal government "will propose legislation and launch a regulatory process on this change in short order." The budget's list of planned laws confirms a bill to extend the Prohibition on the Purchase of Residential Property by Non-Canadians Act to January 1, 2029.

Three things are missing. There is no bill yet. There is no start date for the new-home exemption. And there is no definition of a "new residential property". It could mean a presale bought before the building is finished, a home nobody has lived in, or a home built after a certain date. We do not know yet, and we suggest nobody makes a decision that depends on the answer until the rules are published.

Where does the ban stand today?

The ban took effect on January 1, 2023, and was first set to end on January 1, 2025. On February 4, 2024, the Department of Finance extended it to January 1, 2027. That is still the end date in law today.

The ban covers people who are not Canadian citizens, not permanent residents and not registered under the Indian Act, plus some companies they control. Under the Act, it covers a house or similar building with "not more than three dwelling units", and semi-detached homes, rowhouse units and condo units. The fine for breaking it is up to $10,000.

The regulations already allow some purchases. A work permit holder can buy one home if the permit has 183 days or more left on the day of purchase. A purchase "for the purposes of development" is allowed. We explain these in more detail in our earlier guide to who the ban covers.

If you are a Canadian citizen or a permanent resident, none of this limits you. You can buy any home, new or resale.

Does this change who can buy my house when I sell?

No. This is the most useful line in the budget for a long-time owner. The proposal keeps existing homes inside the ban until January 1, 2029. A detached house you bought 20 or 30 years ago is an existing home. The people who can buy it in 2027 and 2028 are the same people who can buy it today.

Under the law today, the ban ends on January 1, 2027. If Parliament passes this proposal, that date no longer matters for a resale house, because foreign buyers stay out of the resale market for two more years. Your timing can follow your own plans: when you want to move, when your next home is ready, and what the market is doing in your city. Our guide on the best time to sell a house in the Fraser Valley covers those points.

Will foreign buyers come to Fraser Valley new homes?

We expect few, even if the exemption becomes law. The reason is a provincial tax the budget does not touch.

BC's additional property transfer tax charges foreign nationals, foreign companies and some trustees 20% of the fair market value of their share of a residential property. It applies in five regional districts, and two of them cover all six FRIVE cities: the Metro Vancouver Regional District (Surrey, Langley, Maple Ridge) and the Fraser Valley Regional District (Abbotsford, Chilliwack, Mission).

On a new $700,000 townhouse, a foreign buyer would pay $140,000 in this tax alone. On top of that comes the regular property transfer tax and the 5% GST on a new home, with no first-time buyer rebate, because that rebate is only for citizens and permanent residents.

The budget also says the federal government will keep supporting measures "levied by other levels of government" against speculation. In our opinion, that means BC's 20% tax stays. So the exemption may help a builder sell a few units, and we do not expect it to change prices for the rest of the market.

What tax does a downsizer pay on a new condo or townhouse?

A new home comes with a warranty and no big repairs for some years, and many new buildings have an elevator or a main-floor bedroom. The tax is different from a resale home, so it helps to see both sides.

On a new home in BC you pay GST of 5%. The old GST new housing rebate is gone by $450,000, so for most Fraser Valley townhouses and condos it gives nothing. The new first-time buyer rebate does not apply if you have owned and lived in a home in the past five years.

On the other side, BC's newly built home exemption can remove the property transfer tax. It covers a new home with a fair market value up to $1,100,000, with a partial exemption up to $1,150,000. You must be a Canadian citizen or permanent resident and live in the home as your principal residence. You do not need to be a first-time buyer.

Here is one example, for illustration only:

$850,000 home, bought as your principal residence	New townhouse	Resale townhouse
GST at 5%	$42,500	$0
BC property transfer tax	$0 (newly built home exemption)	$15,000
Tax in this example	$42,500	$15,000

Based on the BC property transfer tax rates (1% on the first $200,000 and 2% from $200,000 to $2,000,000) and the newly built home exemption. Some builders include GST in the price and some add it on top, so read the contract. Confirm your own numbers with your lawyer or notary.

So for a downsizer, a new home often carries more tax than a resale home at the same price, because GST is larger than the transfer tax. That does not make it the wrong choice, because a new roof, furnace and windows are part of the price. We cover how to weigh those costs in our guide to condo, townhouse or rancher for downsizers and in strata fees on a fixed income.

What can a new home save a child or grandchild?

If you are helping a child or grandchild buy a first home, a new home can carry no tax at all.

The first-time home buyers' GST rebate returns all of the GST on a new home up to $1 million, up to $50,000. Between $1 million and $1.5 million the rebate shrinks in a straight line. The Department of Finance gives the example of a $1.25 million home, which gets 50%, up to $25,000. Bill C-4, which carries the rebate, received royal assent on March 12, 2026.

At least one buyer must:

• be 18 or older and a Canadian citizen or permanent resident
• not have lived in a home they or their spouse owned in the current year or the four years before
• buy the home as their main residence and be the first person to live in it

The agreement with the builder must be signed on or after March 20, 2025 and before 2031. Construction must start before 2031, and the home must be finished before 2036. Each person can claim it once in their life.

Add BC's newly built home exemption, and the example looks like this:

$650,000 new condo, first-time buyer	Amount
GST at 5%	$32,500
First-time buyer GST rebate	minus $32,500
BC property transfer tax	$11,000
Newly built home exemption	minus $11,000
Tax left to pay in this example	$0

Illustration only, assuming the buyer qualifies for both programs. Rules from the Department of Finance and the Province of BC.

If you plan to give part of the down payment, our guide to gifting a down payment to your children in BC explains the gift letter lenders ask for.

Does the budget change anything else for buyers of new homes?

Two mortgage measures in the same chapter of the budget touch new homes.

The first is a proposal. It would raise the home price limit for optional mortgage insurance from $1 million to $1.5 million and allow a 30-year amortization on those insured mortgages, "provided that at least one borrower is a first-time home buyer or the home is newly built." An amortization is the number of years it takes to pay a mortgage off in full. A mortgage broker can tell you whether this would change your payment once the rules are final.

The second is for builders. From February 1, 2027, new mortgage insurance rules let a builder get an insured construction loan of up to 90% of the value of a new three- or four-unit home, with no price limit and no rule that the builder live in one of the units. Private insurers will also be allowed to insure loans on buildings with 5 to 50 homes. For an owner of a large lot in a Fraser Valley city that allows more homes per lot, this may mean more builders able to make an offer. We would talk with your city's planning office before counting on it.

What should you do now?

If you are selling an existing house, nothing in this budget changes who can buy it. Plan your sale around your next home and your own timing. If you want to know what your house might sell for today, ask us for a free home value.

If you are buying a new home to live in, check three things before you sign: whether the price includes GST, whether the home's value is under $1,100,000 for the transfer tax exemption, and whether you, or a family member buying with you, qualify for the first-time buyer rebate. Our downsizing calculator can help you compare a sale price with the cost of your next home.

If you, or someone you are buying with, is not a citizen or permanent resident, wait. The law has not changed yet, and BC's 20% tax applies either way. Speak with a lawyer who knows these rules before you make an offer on any home.

Key Takeaways

• Budget 2026 proposes to keep the ban on foreign buyers of existing homes until January 1, 2029 and to exempt new homes. Neither change is law yet.
• The budget does not define a "new residential property" or say when the exemption would start.
• If you sell an existing house, the people who can buy it stay the same.
• BC's 20% additional property transfer tax still applies to foreign buyers in all six FRIVE cities.
• A downsizer buying a new home pays 5% GST but can avoid property transfer tax up to $1,100,000.
• A first-time buyer can get up to $50,000 of GST back on a new home, under a rebate that became law on March 12, 2026.

Frequently Asked Questions

Is the foreign buyer ban extended to 2029?

Budget 2026 proposes to extend the ban on existing homes to January 1, 2029. It is a proposal. Until Parliament passes a bill, the law still ends the ban on January 1, 2027.

Can foreign buyers buy new homes in BC now?

Not yet. The exemption for new homes needs a new law and new rules, and the budget does not say what a new home is. Until then, a unit in a new building is covered by the ban like any other home.

Does the budget change who can buy my house when I sell?

No. Existing homes stay in the ban until January 1, 2029 under the proposal, so the people who can buy your house are the same as before.

Does BC's 20% foreign buyer tax still apply in the Fraser Valley?

Yes. It applies in the Metro Vancouver and Fraser Valley regional districts, which include Surrey, Langley, Maple Ridge, Abbotsford, Chilliwack and Mission. The federal budget does not change it.

Do I pay property transfer tax on a new home if I am downsizing?

Often no. The newly built home exemption removes the tax on a new home worth up to $1,100,000 and reduces it up to $1,150,000, if you are a citizen or permanent resident and it is your principal residence.

Do I pay GST on a new condo or townhouse?

Yes, 5%. A first-time buyer may get it all back on a home up to $1 million. A downsizer who has owned a home recently does not qualify for that rebate.

How much is the first-time home buyer GST rebate?

Up to $50,000. It returns all the GST on a new home up to $1 million and shrinks to zero at $1.5 million.

When did the first-time buyer GST rebate become law?

Bill C-4 received royal assent on March 12, 2026. It covers builder agreements signed from March 20, 2025 to the end of 2030.

Sources

• Department of Finance Canada, Budget 2026, Chapter 3 and legislative annex, November 5, 2026
• Department of Finance Canada, Two-year extension to ban on foreign ownership of Canadian housing, February 4, 2024
• Justice Laws Website, Prohibition on the Purchase of Residential Property by Non-Canadians Act
• Justice Laws Website, Prohibition on the Purchase of Residential Property by Non-Canadians Regulations
• Department of Finance Canada, GST relief for first-time home buyers on new homes valued up to $1.5 million, May 27, 2025
• Canada Revenue Agency, First-time home buyers' GST/HST rebate: who can apply
• Parliament of Canada, Bill C-4 (45-1)
• Canada Revenue Agency, Excise and GST/HST News No. 122
• Government of BC, Additional property transfer tax
• Government of BC, Newly built home exemption
• Government of BC, Property transfer tax

Data sourced November 5, 2026. Budget measures are proposals until Parliament passes them. Verify current rules before you make a decision.

Next Steps: Work with FRIVE

The owners we see make the calmest moves plan the sale and the next home together, with the tax on both sides written down before they sign anything. If you are thinking about selling and buying something smaller, start with a free home value, or send the FRIVE team a note and we will go through your numbers with you. You can also read more on our downsizing page.