Recent studies show that Canadian homebuyers are becoming increasingly interested in the United States’ property market. In particular, Canadians have begun flocking to cities such as Phoenix, and other warm locations, to look for deals. Lured by the markedly-weak U.S. dollar, as well as exceptionally-low interest rates and property prices, Canadians have begun looking to these cities as locations for second homes or investment properties with more frequently.
In fact, according to the National Association of Realtors, over the past two years, Canadians have made up the largest percentage of foreign buyers of property in the United States. In total, Canadians equal 23 percent of foreign buyers, up from 11 percent in 2007. The majority of homes purchased by Canadians were found to be in Arizona and Florida.
Good Investment Opportunity for Foreign Buyers
The most common reason for Canadian purchase of U.S. property in recent years is for investment reasons. Most buyers surveyed are betting on the market recovering in the next few years and the dollar regaining strength, meaning that homes purchased now will be sold for a profit.
Such profits will be especially pronounced in areas such as Phoenix that are currently suffering a high rate of foreclosure, and where it is possible to buy a home through a short sale. Further profits will be made when the investment is converted back into Canadian dollars.
However, such investments are not without risks. Experts suggest that continued economic weakness and high unemployment rates could mean that the housing market could remain depressed for a while. Yet, despite such risks, the number of Canadian buyers in warm-weather cities continues to rise.