2025 Year in Review: What Happened and What It Means for Canadian Buyers in 2026

The most significant single event was Royal LePage's August 2025 survey finding that 54% of Canadians with US residential property were considering selling — a number that shocked the industry and validated what agents and advisors had been observing anecdotally for months. The survey, based on 2,500 Canadians, captured a compressed, high-velocity shift that had been building since early 2025 when Canada-US political friction intensified under the second Trump administration. Prior to 2025, the pattern of Canadians reconsidering US property was visible but gradual. After the Royal LePage survey, the scale and speed of the shift became undeniable — and triggered a wave of market analysis, media coverage, and Canadian buyer interest in alternatives that reshaped the flow of 2025 demand. Mexico, the Dominican Republic, and Panama absorbed most of the redirected intent, with Mexico (particularly Puerto Vallarta, Mazatlán, and the Riviera Maya) receiving the largest visible increase in Canadian buyer inquiries and transactions. See our full analysis: Snowbird Alternatives to Florida 2026.

Portugal's Non-Habitual Resident (NHR) tax regime was one of the most powerful incentives driving Canadian buyer interest in Portugal from approximately 2018 through 2023. Under NHR, new residents who qualified could receive a flat 10% tax rate on foreign-sourced income (pensions, rental income from other countries, investment returns) for 10 years. For a Canadian retiree with CPP, OAS, and rental income from a Canadian property, this meant paying 10% Portuguese tax on that income rather than full Portuguese marginal rates — a significant advantage. The NHR program was replaced by IFICI (Incentivo Fiscal à Investigação Científica e Inovação) in January 2024. IFICI is targeted at innovation-sector workers — technology, scientific research, and qualified activity categories — and does not provide the broad income tax advantage that NHR offered to retirees. Most Canadian snowbirds and retirees seeking residency in Portugal do not qualify for IFICI. The practical impact: Portugal's attractiveness as a tax-advantaged destination for Canadian retirees has materially decreased. It remains an excellent lifestyle destination with a practical D7 Visa pathway and no foreign buyer restrictions — but the tax engineering case that drove many 2020–2023 Canadian buyer decisions is no longer available in the same form. See our full Portugal IFICI/NHR guide for Canadians for details.

Exact FIRPTA filing numbers for Canadian sellers are not publicly released, but the scale is significant. FIRPTA (Foreign Investment in Real Property Tax Act) requires the buyer of US property sold by a foreign person to withhold 15% of the gross sale price at closing and remit it to the IRS. Every Canadian selling a US property (Florida, Arizona, Hawaii, or any other state) is subject to FIRPTA unless an exemption applies (the sale price is under $300,000 and the buyer intends to use it as a primary residence — reducing withholding to 0% — or 10% if sale price is $300,001–$1M and buyer will use as primary residence). With 54% of Canadians with US property considering selling, and Canadian snowbird property ownership concentrated heavily in Florida (estimated 50,000+ Canadian-owned properties in Florida alone), the volume of FIRPTA withholdings processed in 2025 was substantial. For individual sellers, the process: 15% is held at closing; you file IRS Form 1040-NR for the sale year; your actual capital gains tax is calculated and the excess withholding is refunded — but refund timelines from the IRS run 6–18 months. Many Canadian sellers in 2025 were experiencing their first FIRPTA encounter and required cross-border tax assistance. See our dedicated guide: FIRPTA for Canadians Selling US Property.

Multiple European Golden Visa programs closed or significantly tightened during 2024–2025, marking a structural change in the investor residency landscape that had been available to Canadians for a decade. Portugal closed its residential real estate Golden Visa in October 2023 (full impact in 2024–2025). Spain announced the closure of its Golden Visa program in 2024 — applications already in process were continued through 2025, but no new residential investment applications are accepted. Greece increased the minimum investment threshold for Golden Visa in premium areas (Athens, Thessaloniki, Mykonos, Santorini) from €250,000 to €800,000 effective August 2023; the lower €250,000 threshold remains available in less-populated areas. Ireland suspended its Immigrant Investor Programme in 2023. The net effect: the accessible EU investor residency landscape available to Canadians in 2020 (€250,000 to €500,000 investments in Portugal, Spain, Greece, Malta, Cyprus) has narrowed dramatically. In 2026, Greece at €250,000 (in eligible regions) and Malta's options remain the most accessible remaining EU pathways, alongside Portugal's D7 (income-based, not investment-based) and Spain's work/retirement visa options. See our Golden Visa comparison guide for Canadians for the current accessible pathways.

Based on Compass Abroad's inquiry and transaction data, combined with publicly available market reports, the ranking of Canadian buyer destinations by demand growth in 2025: (1) Mexico (Pacific coast — Puerto Vallarta, Mazatlán, Riviera Nayarit) — largest absolute demand increase, driven by the Florida exodus and WestJet route expansion. (2) Dominican Republic (Punta Cana, Cap Cana) — strong growth driven by direct Canadian flights, CONFOTUR benefits, and lower entry prices than Mexico coastal markets. (3) Colombia (Medellín) — new entrant, fastest percentage growth from a low base; significant increase in Canadian buyer awareness. (4) Portugal (Algarve, Lisbon) — sustained lifestyle demand from D7 Visa buyers, though down from the 2021–2023 Golden Visa peak. (5) Panama (Panama City, Boquete) — consistent Pensionado visa interest; modest growth. Mexico dominated in absolute volume; Colombia was the fastest-growing on a percentage basis; Portugal was down from peak but stable on a lifestyle-buyer basis. The Dominican Republic punched above its usual weight, absorbing significant Florida-exit demand from Ontario and Quebec buyers with direct flights from Toronto and Montreal.

The 2025 data points to several clear 2026 implications. (1) Mexico is the default recommendation for most Canadian snowbird buyers — the combination of flight access, price, and quality of life is unmatched. Buyers who hesitated in 2025 will find 2026 prices somewhat higher in the fastest-growing markets (Mazatlán, Playa del Carmen), but still dramatically below Florida equivalents. (2) The EU investor residency landscape is narrower — buyers who want EU residency via property investment now have fewer and more expensive options. Greece at €250K (in eligible regions) is one of the few remaining accessible Golden Visa pathways; Portugal's D7 (income-based, not investment minimum) remains excellent for income-qualified buyers. (3) The FIRPTA/US-exit process is becoming more familiar but also more complex as IRS processing times lengthen — Canadian sellers of US property should budget 12–18 months for refund processing and engage a cross-border CPA well before listing. (4) T1135 compliance is under increasing scrutiny — the growth in Canadians owning foreign property has triggered more CRA attention to foreign property verification. File correctly and on time. (5) Mexico market selection matters more in 2026 than it did in 2020 — the divergence between strong markets (Mazatlán, established PV corridors) and oversupplied markets (Tulum, some Cancun sub-markets) is real and widening. Market-specific due diligence is essential. See our Mexico market forecast and 2026–2027 snowbird guide.

2025 saw a notable increase in T1135 compliance activity, driven by two forces. First, the growth in Canadians owning foreign property — particularly from the 2020–2024 Mexico, Dominican Republic, and Portugal purchase waves — has increased the total number of Canadians who have T1135 obligations. Many first-time foreign property owners in 2020–2022 are now receiving their third or fourth T1135 filing reminder from their accountants, and the learning curve for annual compliance is established. Second, CRA has increased its verification of T1135 filings as part of broader international tax compliance enforcement. The Foreign Account Compliance framework and data-sharing between Canada and other countries' tax authorities (under OECD's Common Reporting Standard, CRS) means CRA has more information about foreign property ownership than ever before — and can cross-reference T1135 filings against that data. The consequences: late or non-filing penalties are $25/day up to $2,500, and gross negligence penalties can reach 5% of the property's cost per year. The Voluntary Disclosure Program (VDP) can reduce penalties for late filers, but CRA updated its VDP guidelines to make relief less automatic — particularly for repeat non-filers or those who come forward only after a CRA inquiry. If you own foreign property worth more than CAD $100,000 and have not been filing T1135, engage a cross-border accountant to review your situation and file amended returns before CRA contacts you. See our guides: Canadian Tax on Foreign Property and T1135 VDP Guide.

The biggest emerging risk in 2025 was developer quality divergence in oversupplied markets — particularly Tulum and some secondary Mexican markets that saw speculative development 2022–2024. The pattern: developers launched pre-construction projects during the 2022–2024 period of peak international demand, collected deposits and installment payments, and in a number of cases either delayed construction significantly or, in some instances, failed to complete. This is not new to Mexican real estate — developer default has always been a risk — but the scale of the 2022–2024 construction boom created a larger-than-usual exposure. Canadian buyers who purchased pre-construction in Tulum and certain other markets in 2022–2024 and paid installments without escrow protections are in some cases dealing with delayed or stalled completions. The lesson for 2026: insist on escrow for all pre-construction payments, verify developer completion track record on prior projects, engage an independent Mexican real estate attorney (not the developer's attorney), and be skeptical of projected rental yields that cannot be supported by actual occupancy data from completed comparable units. See our Mexico buying guide and Mexico market forecast for the full due diligence framework.

Belize's Qualified Retired Persons (QRP) program received renewed attention in 2025 as Canadian buyers looking at accessible alternatives to Panama's Pensionado encountered Belize's offering. The QRP requires applicants to be at least 45 years old with verifiable foreign-sourced income of at least USD $2,000 per month (from pension, investment, or other passive sources). Unlike some programs that require a specific investment in country, the QRP is primarily income-based. Benefits include exemption from Belize income tax on foreign-sourced income, duty-free import of household goods and personal vehicle, and a clear permanent residency pathway. Belize has several distinctive advantages: English is the official language (unique in Central America), the Belize dollar is permanently pegged 2:1 to the USD (no currency risk), freehold property ownership is available to foreign buyers, and Belize is significantly cheaper than Panama for day-to-day living. The drawbacks: Belize is smaller with less developed infrastructure than Panama or Costa Rica; healthcare requires travel for serious conditions; and the property market is less liquid than Panama or Mexico. But for the right Canadian buyer — those who want English, USD stability, Caribbean beach access, and a smaller community character — Belize remains an underrated option. See our Belize QRP visa guide.