Tax Sales in Canada: Complete Investment Guide 2026

info What Are Tax Sales?

Tax sales occur when property owners fail to pay their property taxes for an extended period. Municipal governments then have the authority to sell these properties to recover the unpaid taxes. This creates opportunities for investors to acquire real estate at prices significantly below market value.

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Did You Know?

Currently there are 376 active tax sale properties listed across Canada. Properties can sell for as little as the back taxes owed—sometimes just a few thousand dollars.

route How Tax Sales Work in Canada

The tax sale process varies by province, but generally follows these key steps:

1

Tax Arrears Accumulate

Property owner fails to pay property taxes for 2-3 years (varies by province). Interest and penalties accumulate on the unpaid balance.

2

Notice Period

Municipality provides formal notice to the property owner about the pending sale. The owner has a final chance to pay the arrears and save their property.

3

Public Advertisement

Properties are advertised publicly for a set period before the sale. This is when investors like you can research and prepare bids.

4

Sale Event

Properties are sold via public tender (sealed bids) or auction (open bidding) to the highest qualified bidder.

5

Transfer of Ownership

Successful bidder receives title to the property. The tax deed typically clears most existing liens and mortgages.

category Types of Tax Sales

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Public Tender

Sealed bids are submitted by a deadline. The highest qualified bid wins. Bids remain private until opened.

Ontario Nova Scotia New Brunswick

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Public Auction

Live bidding event where participants compete openly. Fast-paced and requires quick decision-making.

Alberta Saskatchewan

Learn more about Tender vs Auction arrow_forward

map Tax Sales by Province

Province	Primary Method	Active Listings	Guide
Nova Scotia	Public Tender	323	Read Guide arrow_forward
Ontario	Public Tender	53	Read Guide arrow_forward

fact_check Due Diligence Checklist

Before bidding on any tax sale property, complete these essential checks:

check_circle Title search for liens and encumbrances

check_circle Verify property boundaries and survey

check_circle Check zoning and permitted uses

check_circle Environmental assessment

check_circle Physical inspection of the property

check_circle Research market value and comparables

check_circle Calculate total costs including fees

check_circle Review tender documents carefully

warning Key Risks to Consider

Tax sale properties are sold 'as-is' with no warranties. Some liens may survive the sale. Always consult with a real estate lawyer before purchasing.

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No Interior Access

You rarely get to see inside a building before bidding. Budget for significant renovations and unexpected repairs.

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Environmental Liability

You become responsible for any environmental contamination. Check for past industrial or commercial use.

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Redemption Periods

In some provinces, the previous owner has time to pay back taxes and reclaim the property after you buy it.

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Occupied Properties

Some properties may be occupied by tenants or previous owners, requiring legal eviction procedures.

help Frequently Asked Questions

Yes, it is highly recommended. A lawyer can help with title searches, ensure the tender package is filled out correctly, and handle the closing process. The cost is minimal compared to the potential risks.

Traditional mortgages are difficult to get for tax sales because of the tight timelines and 'as-is' nature. Most investors use cash, lines of credit, or private lenders.

If a property sells for more than the taxes owed, the surplus is paid into court. Previous owners or lienholders can apply to claim these funds.

Typically 20% of your bid amount is required as a deposit, usually in the form of a certified cheque or bank draft. The exact requirements are specified in the tender package.