A Guide to Selling your House as a Non-Resident

Are you a homeowner who lives outside of Canada and is looking to sell your property in Alberta? You may feel overwhelmed or unsure about the necessary steps to take. However, selling a home in Alberta as a non-resident does not have to be a daunting experience. With proper planning and assistance, you can successfully sell your property and achieve your desired outcome. In this guide, we will cover everything you need to know about selling your house in Alberta as a non-resident.

As a non-resident, you may be subject to different rules and regulations compared to Canadian residents. It’s essential to determine your residency status for tax purposes. Consult with a tax professional to understand your obligations and any potential exemptions or tax implications.

Hire a Real Estate Agent:   

The first step to selling your house in Alberta is to hire a licensed real estate agent who specializes in working with non-residents. Your agent should have experience and knowledge of the local market and regulations. They can provide essential advice and guidance throughout the selling process. A trusted agent may also help you find potential buyers and complete the transaction on your behalf, saving you time and hassle.

Get a Property Appraisal:

It is important to determine the market value of your property before putting it up for sale. A professional property appraisal can provide you with an accurate estimate of the current value of your house. A licensed property appraiser or your real estate agent can conduct this appraisal.

In Alberta, sellers are legally required to disclose any known material defects or issues with the property. Provide potential buyers with a completed Property Disclosure Statement to ensure transparency.

Obtain a Clearance Certificate:

As a non-resident seller, you are required to obtain a Clearance Certificate from the Canada Revenue Agency (CRA). This certificate confirms that you have paid all necessary taxes related to your property ownership in Canada. Because the application process can take several months, we recommend applying for the certificate early in the selling process.

Understand the Tax Implications:

Selling a property in Canada as a non-resident may have tax implications. The CRA may withhold taxes from the purchase price of your property as a security deposit until you file your Canadian tax return. It is important to understand the tax laws and regulations related to property sales for non-residents to avoid any unexpected financial consequences.

The CRA requires that non-residents pay a withholding tax of 25% on any capital gains realized from the sale of a Canadian property. However, this rate may be reduced if there is a tax treaty between Canada and your home country. If your property is a rental property, the withholding amount is greater.

Determine Your Selling Strategy:

Finally, you need to determine your selling strategy. Your agent can help you create an effective marketing plan that showcases your property’s unique features and attracts potential buyers. As well, you may also have to decide if you are willing to negotiate on the sale price and how much you are willing to spend on repairs or upgrades to your property.

Selling a house in Alberta as a non-resident can be a challenging and complex process but is very achievable. By following these tips and working with trusted industry professionals, you can successfully sell your property and achieve your desired outcome. It’s essential to stay informed about the regulations and requirements related to non-resident property sales. With a clear plan and realistic expectations, selling your house in Alberta can be a financially rewarding experience. Working with experienced professionals and ensuring that you comply with all legal requirements is essential for a smooth and successful sale.

Avoid the Risks: Pros and Cons of Buying and Selling a House on the Same Day

Buying and selling a house or property on the same day can seem like a convenient and hassle-free approach, right? In a perfect world, it makes sense. However, if you’re considering simultaneous closings, there are a few things to keep in mind. While there are certainly benefits that come along with simultaneous closings, there are also some potential risks and pitfalls that can make the process less than ideal.

In this blog post, we’ll explore the pros and cons of simultaneous closings when purchasing or selling a home. We’ll take a closer look at the benefits and drawbacks of this approach. Then you can better understand what you’re getting yourself into and make an informed decision that’s right for you.

Pros of Simultaneous Closings:

One of the biggest benefits of simultaneous closings is that it can be more convenient and cost-effective than traditional sales. For example, if you’re purchasing a new home and want to sell your current one, simultaneous closings can help you avoid paying two mortgages at once. Additionally, you’ll will have one mortgage payment after both transactions closing, which can save you a lot of money in the long run.

Another pro of simultaneous closings is that it can save you time. Instead of dragging out the process over several weeks or months, you can complete both transactions on the same day. This can be especially advantageous for people who are in a hurry to move and don’t want to wait around for a buyer or a seller to come through.

Cons of Simultaneous Closings:

One of the biggest drawbacks of simultaneous closings is that they require a significant amount of coordination and timing. Any unforeseen circumstance in legal or financial issues can cause significant delays and impact the transaction closing on time. There is just no margin for error.

Additionally, there are certain situations where simultaneous closings may not be possible. For example, if the buyer needs to secure financing, but the sale of their own home is not yet final, they may not be able to close on their new property until the old one is sold. If either transaction falls through, everything else falls through with it – leaving you back at square one.

Another potential drawback of simultaneous closings is that they can be more stressful and overwhelming than traditional sales. You’re dealing with two properties, two sets of negotiations, two sets of paperwork, and two separate closing procedures. This can be a lot to handle, especially if you’re unfamiliar with handling complex real estate transactions.

One of the most common risks for delays is obtaining funds from the buyers’ lender, which could result in the delay of a few hours or even a whole day.

Or, failure to obtain proof of insurance required by the lender could result in a delay in closing the sale.

Other possible risks could include issues with property inspections, appraisals, or with the title clearance, which could also cause delays.

This can lead to a chaotic situation where agreements need to be made quickly, which can cause anxiety and stress for buyers and sellers.

Our recommendations?

  • Avoid having your purchase and sale transactions close on the same day if possible.
  • Minimize potential disruptions by arranging any third-party services such as cleaners or movers on any day except possession day.
  • Have a contingency plan in case the closing is delayed.  
  • Have a backup living arrangement or storage unit for your belongings.

While simultaneous closings can be beneficial under the right circumstances, they’re not always the best or safest option. Take the time to weigh the pros and cons of this approach, so you can make an informed decision that’s right for your situation.

Ultimately, if you’re considering simultaneous closings, it’s always a good idea to consult with a qualified real estate lawyer so that they can help you understand the specific steps, risks, and timing demands involved. With expert guidance and planning, you can mitigate risks and increase the chances of a successful and complication-free simultaneous closing.