Moving to a new country comes with a long list of firsts: a new job, new neighbourhood, new bank accounts—and, eventually, perhaps a new home.

But there's a frustrating situation many newcomers to Canada encounter when they start thinking about buying.

You may have a good job. You may have substantial savings. You may have managed your finances responsibly for years. But much of that financial history happened somewhere other than Canada.

Does that mean you have to spend years building Canadian credit before you can buy a home?

Not necessarily.

The good news is that Canada has mortgage programs designed to help newcomers become homeowners, even when they haven't had much time to establish themselves financially in their new country.

The Canadian Credit History Problem

When you apply for a mortgage, lenders want to understand how reliably you manage financial obligations. For someone who has lived in Canada for years, a Canadian credit report provides much of that history.

A newcomer may simply not have had enough time to build one.

Fortunately, a limited Canadian credit history doesn't automatically mean you can't qualify for a mortgage.

Mortgage insurers and lenders may consider other ways of demonstrating creditworthiness. Depending on your circumstances, that can include an international credit report, banking history from your country of origin, Canadian bank statements, or a history of consistently paying expenses such as rent, utilities, phone bills and other regular obligations.

In other words, the financial habits you established before arriving in Canada may still matter.

Can Newcomers Buy With a 5% Down Payment?

In some circumstances, yes.

There are mortgage options available to qualified newcomers that allow the purchase of a home with a down payment starting at just 5%.

For an eligible home priced at $500,000 or less, the minimum down payment can be 5%. Above $500,000 and below $1.5 million, the minimum is 5% of the first $500,000 plus 10% of the remaining amount. Homes priced at $1.5 million or more require at least 20% down. A lender may require a larger down payment depending on your circumstances.

For example, on a $400,000 home, a 5% down payment would be $20,000. That's considerably less than the $80,000 you'd need for a 20% down payment.

Keep in mind that mortgages with less than 20% down generally require mortgage default insurance, which adds to the overall cost of borrowing.

Of course, not everyone automatically qualifies. Your income, employment, existing debts, credit history, immigration status and the property you're purchasing can all affect your options.

The source of your down payment matters, too. Savings are commonly acceptable, and some programs allow financial gifts from qualifying family members. Other sources of funds may be subject to additional restrictions.

The important thing to understand is that you may have more options than you realize.

Can You Buy a Home in Canada Without Permanent Residency?

If you're new to Canada, your immigration status can affect your ability to purchase a home.

Under the federal Prohibition on the Purchase of Residential Property by Non-Canadians Act, certain non-Canadian buyers are restricted from purchasing residential properties.

However, the rules include important exemptions.

Canadian citizens and permanent residents are not subject to the prohibition. Certain people living and working in Canada on valid work permits may also qualify, as can some international students and other individuals who meet specific requirements.

Location matters, too. The restrictions generally apply to residential properties within Statistics Canada's designated census metropolitan areas and census agglomerations, including the Edmonton area. Properties outside those boundaries are exempt from this federal prohibition. The specific property's location must be checked; being in a rural municipality does not automatically mean it is exempt.

The important distinction is that qualifying for a mortgage doesn't automatically mean you're legally eligible to purchase a home.

Before beginning your home search, it's worth confirming both your purchasing eligibility and your financing options. A qualified real estate lawyer can help clarify how the legislation applies to your circumstances.

For additional information, visit the Canada Mortgage and Housing Corporation's guide to the federal foreign-buyer prohibition.

Your Paper Trail Can Be Surprisingly Important

If you're relatively new to Canada and homeownership might be in your future, start keeping good financial records now.

Bank statements, proof of rent payments, utility bills, employment documentation and records from financial institutions in your previous country may all become useful when a lender is trying to establish your financial history.

It's also a good idea to begin building your Canadian credit history as soon as practical. Opening a Canadian bank account, using a credit card responsibly and making payments on time can help establish a financial track record.

You don't necessarily need years of Canadian credit history to qualify for a mortgage, but having some history certainly doesn't hurt.

This is one of those situations where being organized ahead of time can make a significant difference.

Get the Financing Sorted Out Before the House Hunting

This is good advice for any buyer, but it's particularly important when you're new to Canada.

Mortgage requirements aren't identical from one lender or mortgage insurer to another. A situation that doesn't fit neatly into one lender's guidelines may have options elsewhere.

Before we start looking at homes, I generally want my buyers to have a clear understanding of three things:

• What they can comfortably afford. Just because a lender approves a certain amount doesn't necessarily mean you should spend it all.

• What financing they're likely to qualify for. Understanding your mortgage options early helps establish a realistic price range.

• What documentation or conditions could affect their purchase. Identifying potential issues before making an offer can help avoid unnecessary complications later.

This preparation allows us to search for homes within a realistic budget and, just as importantly, prepare an offer with financing conditions and timelines that make sense.

Buying a home is exciting. Discovering an unexpected financing problem after you've fallen in love with a property? Not so much.

A New Country—and Eventually, a Home of Your Own

Establishing yourself in Canada takes time. Building a Canadian credit history does too.

Homeownership, however, doesn't necessarily have to wait until you've accumulated years of Canadian financial history.

Whether you've recently arrived in Alberta or have been here for a few years, understanding your options is an important first step.

And if you're considering buying a home in Spruce Grove, Edmonton, Stony Plain, St. Albert or the surrounding communities, I'd be happy to help.

I've been helping people buy and sell homes throughout the Edmonton region since 2002, and I understand that everyone's situation is different. I can help you navigate the local housing market, understand the buying process and connect with qualified mortgage professionals who can assess your financing options.

The first step doesn't have to be making an offer. Sometimes it's simply finding out what's possible.

Jason Hafso, REALTOR®

MaxWell Challenge Realty

780-964-7335

jason@MyRealHome.com

https://myrealhome.com

Please note: Mortgage qualification depends on individual circumstances, lender and mortgage insurer requirements, and applicable Canadian laws. Foreign-buyer restrictions and exemptions may change. Consult qualified mortgage and legal professionals to confirm your eligibility before purchasing.

Feature photo: Gustavo Fring / Pexels. Used under the Pexels License.

One of the biggest questions I get from homeowners isn't what their home is worth or when they should list it. It's this:

"Should we sell our current home before we buy our next one?"

It's a fair question, and one that doesn't have a one-size-fits-all answer. Every family's finances, comfort level, and goals are different. That said, after more than two decades helping people buy and sell homes throughout Edmonton, Spruce Grove and the surrounding communities, I've seen enough transactions to know that some approaches consistently create less stress and produce better financial outcomes than others.

For most people, I believe the safest approach is to sell first, then buy.

That might not sound very exciting. In fact, many people initially dislike the idea because they're worried they won't find their next home in time. But once your current home is sold, everything becomes much clearer. You know exactly how much money you'll have available, your mortgage broker can give you an accurate budget, and when you make an offer on your next home, you aren't asking the seller to take on additional risk. That makes your offer more attractive and often gives you more negotiating power.

Perhaps most importantly, you've removed one of the biggest sources of stress from the process. You're no longer wondering whether your home will sell before a deadline arrives. Instead, you're simply looking for the right home.

Of course, selling first isn't perfect. Occasionally the timing doesn't line up exactly, and you may need temporary accommodations or storage between homes. While moving twice certainly isn't ideal, I've found that most people would rather deal with a temporary inconvenience than make a rushed financial decision involving hundreds of thousands of dollars.

Some homeowners choose the opposite approach and buy first. This can work very well, but only if your finances support it. Depending on your situation, your lender may be able to arrange bridge financing or another financing solution that allows you to own both homes for a period of time. This approach lets you shop patiently instead of feeling pressured to find something before your current home sells. The downside, of course, is that you may temporarily be responsible for two mortgages, two property tax bills, two insurance policies and all the other expenses that come with owning two properties. That's a conversation you should have with your mortgage broker before you ever start looking at homes.

Then there's the strategy many people hope will solve everything: writing an offer that is subject to the sale of their current home.

On the surface, it sounds ideal. You secure the home you want, but you're only obligated to buy it if your current home sells first. Unfortunately, in practice, this is often the most stressful option of all.

The first challenge is convincing the seller to accept your offer. Remember that from their perspective, your purchase now depends on another house selling, one they have no control over. They're effectively waiting for two transactions instead of one. Naturally, many sellers are reluctant to accept that uncertainty.

In a strong seller's market, subject-to-sale offers are often at a significant disadvantage. If sellers have multiple buyers to choose from, they're unlikely to choose the offer with the greatest uncertainty unless it's substantially stronger in other ways, such as offering a higher purchase price or more favourable terms. Even if they do accept it, they'll often include what's commonly known as a 24- or 48-hour escape clause, allowing them to continue marketing the property.

That clause can create enormous pressure. If another acceptable offer comes along, you'll receive notice that you have a limited amount of time, often just 24 or 48 hours, to remove your sale condition or lose the home. At that point, you're suddenly racing against the clock.

Ironically, a buyer's market doesn't necessarily make subject-to-sale offers any more appealing.

When homes are taking longer to sell, sellers are already worried about finding a buyer for their own property. Asking them to also take on the risk that your home may face the same challenges doesn't usually make the situation more attractive. Instead of solving one uncertainty, you've simply doubled it. While some sellers will still consider these offers, they often do so only because they have few alternatives, not because they're comfortable with the arrangement.

The biggest problem isn't actually the contract itself. It's what happens emotionally after it's accepted.

Once you've mentally moved into your new home, every showing of your current home feels critical. Every day without an offer becomes stressful. Every piece of buyer feedback feels more significant than it probably is. Before long, many homeowners start asking whether they should lower the price, accept weaker terms, agree to costly repairs, or make other concessions simply to get their home sold before their purchase disappears.

I've seen homeowners negotiate an excellent price on the home they were buying, only to give away far more money on the home they were selling because they were under intense time pressure. In the end, the numbers often work against them.

That's one of the reasons I generally view subject-to-sale offers as a strategy to use only when there's a compelling reason, not as the default plan. There are situations where they're appropriate, and I've successfully negotiated many of them over the years. But they should be entered into with a clear understanding of the risks, not because they seem like the easiest solution.

The reality is that every move involves some compromise. Selling first may mean temporary housing. Buying first requires stronger finances. Subject-to-sale offers can work, but they often transfer the stress from one part of the transaction to another rather than eliminating it.

The good news is that none of these decisions need to be made alone.

One of the most valuable things a REALTOR® can do isn't simply open doors or negotiate contracts. It's help you develop a strategy before any paperwork is signed. That means looking at your home's likely saleability, your financial position, current market conditions, and your personal comfort with risk. Often, a thirty-minute conversation before you start looking at homes can save weeks of stress and potentially thousands of dollars later.

If you're thinking about moving in the next few months, or even next year, I'd be happy to sit down with you and discuss the different approaches. Every situation is unique, and there's no obligation. Sometimes the most valuable advice comes long before your home ever hits the market.