Canadians are Over-Taking the United States
At least when it comes to real estate anyway.
For the past several years, investing in real estate in the United States has been something extremely risky for everyone, Canadians and Americans included. But there’s been an interesting shift in the past year or two. American real estate is being offered for rock-bottom prices, far better than anything you’re likely to find on this side of the border. And interest rates still remain at historic lows too. So why not invest in American real estate if you can?
That’s the question that real estate investor Victor Menasce is asking. Within the past two years he’s purchased over 30 properties in Pennsylvania, Illinois, Florida, Arizona, and the Sun Belt. He even purchased a baseball stadium in New Jersey. And he says, he was able to do it all because Canadians have an advantage when it comes to buying American real estate.
“We see value in places that Americans don’t notice quite so readily,” says Menasce, who authored the book The Great Canadian Takeover.
He’s not wrong, the popularity of U.S. real estate right here in Canada is soaring. While $66.4 billion was invested into this country’s properties in 2011, that jumped to $82.5 billion in 2012.
Rick Raddatz, a political commentator that has also noticed the uptick of Canadians buying American real estate, says that he’s not surprised given the world that we live in.
“The reason this is happening is because we’re living in a global economy,” he says. “AS international market places become integrated, we’re discovering more efficient ways to work with each other. The internet also enhances global interaction.”
And while that’s undoubtedly true, Menasce also says that there are reasons American property looks so good to the Canadian investor right now.
“The trend is a result of a combination of factors including the devaluing of the U.S. dollar, a strong Canadian dollar, an impressive U.S. real estate market and properties seeing far below construction costs,” he says.
He points to the fact that while you’ll pay $353,000 for a home in Ottawa, and $510,000 on the same in Toronto, you can get the exact same property for $149,000 in Tampa, Florida.
Jenny Witterick, chartered financial analyst and president of Sky Investment Council, says that while scooping up these properties might just be a dream for these investors, it’s also benefiting the American economy, too.
“Initially, the impact is positive, because when Canadians buy a home, they also spend money on furniture, restaurants, and other things, so it’s positive for the U.S. economy, because there’s more cash coming into the country,” she says.
Want to get in on the American housing boom? Stay tuned, later today we’ll be giving you tips on how you too, can cash in on this American takeover.