In This Guide
What is a Tax Sale?
A tax sale occurs when a municipality sells a property to recover unpaid property taxes. When property owners fail to pay their municipal taxes for an extended period (typically 2-3 years), the municipality has the legal right to sell the property to recover the owed taxes.
These sales present unique opportunities for investors because properties are often sold at prices significantly below market value. The municipality's primary goal is to recover the taxes owed, not to maximize the sale price.
Key Insight
Properties are typically sold for the amount of taxes owed plus fees and costs - often just a fraction of the property's actual market value.
How Tax Sales Work
The tax sale process follows a general pattern across Canada, though specific rules vary by province:
Tax Arrears Accumulate
Property owner fails to pay taxes for multiple years (typically 2-3 years depending on province).
Municipality Registers a Tax Lien
A legal claim is placed against the property. The owner is notified and given opportunity to pay.
Property is Listed for Sale
The municipality advertises the property for tax sale, either through public tender or auction.
Sale Occurs
Bidders compete to purchase the property. Highest bidder (or winning tender) takes ownership.
Redemption Period
In most provinces, the original owner has a period to reclaim the property by paying all owed amounts plus interest.
Types of Tax Sales
Public Tender
Sealed bids are submitted by a deadline. The highest bid wins. Common in Ontario.
- More time to research
- No bidding war pressure
- Can't adjust bid
Public Auction
Live bidding at a scheduled event. Bidders compete openly. Common in Alberta, Nova Scotia.
- Can react to competition
- Immediate results
- Emotions can drive overbidding
For a detailed comparison, see our Public Tender vs Auction Guide.
Redemption Periods by Province
The redemption period is the time after a tax sale during which the original owner can reclaim their property. This is one of the most important factors to consider.
| Province | Redemption Period | Sale Type |
|---|---|---|
 Ontario | 1 year | Tender |
 British Columbia | 1 year | Auction |
 Manitoba | 1 year | Auction |
 Nova Scotia | 6 months | Both |
 Saskatchewan | 6 months | Auction |
 New Brunswick | 6 months | Auction |
 Newfoundland | 6 months | Auction |
 Alberta | None | Auction |
Alberta Advantage
Alberta is unique in having no redemption period. Once you win at auction, the property is immediately yours with a clean title.
Due Diligence Checklist
Before bidding on any tax sale property, complete this essential checklist:
Risks and Considerations
Redemption Risk
The original owner may redeem the property during the redemption period, returning your payment plus interest but losing the property.
Occupancy Issues
Current occupants may refuse to leave. Eviction can be costly and time-consuming (3-6+ months).
Property Condition
Properties are sold "as-is" with no warranties. Hidden problems may exist.
Surviving Liens
Some liens (environmental, utility) may survive the tax sale and become your responsibility.
Getting Started
Ready to explore tax sale opportunities? Here's how to begin:
Browse Listings
Explore current tax sale properties in your target areas.
Research Properties
Conduct thorough due diligence on promising opportunities.
Submit Your Bid
Prepare and submit a competitive tender or attend the auction.
Start Exploring Tax Sale Properties
Browse thousands of active listings across Canada.
Browse Properties