Purchasing Real Estate in the US

by Mike Bouma

Are you considering purchasing real estate in the U.S?  Experts from both sides of the border are trying to convince Canadians to keep purchasing real estate in the U.S.  Some people agree that the experts are correct when they say that the value of the real estate will rise, so today is the time to purchase.  Other people disagree, that the real estate market will not be a lucrative investment, especially in 10 – 15 years when the baby boomers can no longer travel.  Some people are saying to buy in Canada with the stronger dollar and the stronger economy, it will be money well spent.
The experts are saying, according to an article written on the Financial Post website, that people should be purchasing now to avoid the rising costs of the real estate in the U.S.  They say that as of now Canadians are the leaders of purchasing real estate in the U.S. with 25% of the market.   They say that “per every square foot in the U.S. it is $100US compared to $500 - $600 per square foot for a condo in Toronto.”  This really sounds like a bargain to me and many people think so too.  These people agree that to purchase today will give you an advantage later.
Other people disagree with what the experts are saying.  These people are saying that you have to look at the whole package, not just the sale price of the property.  They say that because the U.S. is still looking to find revenue where ever they can, it means that taxes for foreigners to have a second home in their country will rise significantly.  This may cause the property to no longer be lucrative enough to consider purchasing.  Some others think that purchasing in Canada is the way to go.  They say because the Canadian economy is doing so well, the property will be more valuable.
Considering purchasing in the U.S. takes research.  You need to know what all of the cost will be before you purchase and have an exit strategy for your capital gains.  Are you willing to take a risk in the U.S. with rising taxes, people getting older and selling within 10 – 15 years, and any other legal snags you may encounter?  Or will you look closer to home and invest in Canadian real estate?

Mike Bouma is a Broker with RE/MAX Ability in Oshawa, Canada. Visit Mike at http://www.bouma.ca for more articles as well as information on Oshawa homes