Canadians buying US real estate accounted for about 23% of international buyers in the past year according to data from the National Association of Realtors. This makes up the largest chunk of foreign investment into American real estate for the past three years in a row.
The US Housing Market Crash
The collapse of the US housing market, along with the fall of the dollar and the global financial crisis that ensued, combined to create opportunities for foreign investors like Canadians to invest and profit from the purchase of prime US real estate. All of a sudden large chunks of prime properties in choice US locations such as Florida, New York, and even Las Vegas real estate became somewhat affordable for the average investor. The 30% fall in housing prices combined with a stronger Canadian dollar made it very lucrative for Canadians to flock south of the border.
Essential Tips for Canadians Buying US Real Estate
The fact that American demand for property soured due to the credit crunch, a lot of developers and realtors are encouraging Canadians to invest in US real estate. Many are offering fire-sale prices from foreclosed properties that were once valued at hundreds of thousands of dollars. However, before you get that checkbook and sign that contract, there are a few things that you need to know.
Check out the Property First
Never buy a piece of property without visiting it in person. The pictures online may tell a different story once you finally get to see with your own two eyes the property you are interested in. This is especially true for foreclosed properties classified as fixer-uppers. Due to the vast amount of US foreclosures, many US properties sit for a year or more without any maintenance at all. There have also been reports that some disgruntled US homeowners have taken out their anger on the property being seized by the bank and have vandalized some sections in order for it to be unsellable.
Be sure that you also check the viability of the neighborhood as well as this will have a direct effect on the value of your property should you decide to sell it later on. Neighborhoods that have higher crime rates and poor schools should be avoided even if the price being offered is really hard to refuse as this can backfire on you in the long term.
Do Proper Tax Planning
It is recommended that you do not stay in the US for more than 121 days if you do not hold US residency status. The consequence of doing this is that you may have to shell out income taxes not only in the US, but also back home in Canada. Consult with a tax attorney that specializes in US tax regulations about the options available to you since investing in US real estate may require you to be in the country for long periods.
Do not Downplay Insurance Coverage
For Canadians buying US real estate, it is important to note that insurance plays a major role in your US real estate investment. Depending on the location of your property, you may require coverage for natural disasters such as hurricanes and flooding. Take into consideration that the premium for these would likely cost more than your average policy. Ensure that you have the correct liability insurance for your property. Be sure to consult with a legitimate insurance firm to know your options regarding this.
For more information on how you can invest and profit from US real estate, check out www.stevemartel.com
The US Housing Market Crash
The collapse of the US housing market, along with the fall of the dollar and the global financial crisis that ensued, combined to create opportunities for foreign investors like Canadians to invest and profit from the purchase of prime US real estate. All of a sudden large chunks of prime properties in choice US locations such as Florida, New York, and even Las Vegas real estate became somewhat affordable for the average investor. The 30% fall in housing prices combined with a stronger Canadian dollar made it very lucrative for Canadians to flock south of the border.
Essential Tips for Canadians Buying US Real Estate
The fact that American demand for property soured due to the credit crunch, a lot of developers and realtors are encouraging Canadians to invest in US real estate. Many are offering fire-sale prices from foreclosed properties that were once valued at hundreds of thousands of dollars. However, before you get that checkbook and sign that contract, there are a few things that you need to know.
Check out the Property First
Never buy a piece of property without visiting it in person. The pictures online may tell a different story once you finally get to see with your own two eyes the property you are interested in. This is especially true for foreclosed properties classified as fixer-uppers. Due to the vast amount of US foreclosures, many US properties sit for a year or more without any maintenance at all. There have also been reports that some disgruntled US homeowners have taken out their anger on the property being seized by the bank and have vandalized some sections in order for it to be unsellable.
Be sure that you also check the viability of the neighborhood as well as this will have a direct effect on the value of your property should you decide to sell it later on. Neighborhoods that have higher crime rates and poor schools should be avoided even if the price being offered is really hard to refuse as this can backfire on you in the long term.
Do Proper Tax Planning
It is recommended that you do not stay in the US for more than 121 days if you do not hold US residency status. The consequence of doing this is that you may have to shell out income taxes not only in the US, but also back home in Canada. Consult with a tax attorney that specializes in US tax regulations about the options available to you since investing in US real estate may require you to be in the country for long periods.
Do not Downplay Insurance Coverage
For Canadians buying US real estate, it is important to note that insurance plays a major role in your US real estate investment. Depending on the location of your property, you may require coverage for natural disasters such as hurricanes and flooding. Take into consideration that the premium for these would likely cost more than your average policy. Ensure that you have the correct liability insurance for your property. Be sure to consult with a legitimate insurance firm to know your options regarding this.
For more information on how you can invest and profit from US real estate, check out www.stevemartel.com
RSS Feed