Americans See Canadian Buyers Flood into Property Markets
Photo: Flickr / Roman Boed
While Canada and other countries such as Australia, Singapore and the United Kingdom have to contend with foreign buyers from Asia raising local property prices, in the United States, it is the Canadians who are responsible for these patterns. According to a report published by America’s National Association of Realtors, buyers from Canada have been responsible for massive $19 billion of property sales in the United States over the past year. The majority of purchases have been in places with tropical or temperate climates compared to Canada. Foreign buyers have decided to purchase properties in locations such as Florida, California, and Texas – all of which combined account for close to 50 percent of foreign home sales in the country. The most popular property destination for Canadians, according to the statistics provided by the association, was Florida.
In addition to Canadian buyers, the Americans also still have to contend with buyers from China. Even though Chinese buyers still manage to make up the bulk of property sales volume in the country – and keeping their spot at the top for the last four years in a row, Canadian buyers account for a large amount of the increase of foreign sales of homes in the United States this year.
One of the reasons for this, according to the chief economist of the association, is that American homes are, compared to their Canadian counterparts, much more affordable. As a result, since Canadians have been able to sell their own properties in Canada for record prices, they are thus able to purchase more costly homes in the United States to serve as a secondary residence or a vacation home. On average, the association reports that Canadians spend $560,000 USD, and this is the case even when the Canadian loonie is only worth three quarters of the value of the American greenback. This average price also reflects a massive rise of nearly seventy percent compared to what Canadians paid for American properties in past years.
American home prices are incredibly affordable compared to other countries, especially those from which the foreign buyers come from. The average home price in the United States is just $263,800 American – nearly half of the Canadian national average of $504,458. Along with cheaper prices, foreign buyers also often purchase properties overseas as a way to hide their money, or to skirt strict regulations that prevent them from taking more than a specific sum out of the country annually.
Published Date: Sep 27 2017