The recent collapse of the US housing market has definitely left it's imprint on human psyche; however there is one group that has actually benefited from this event. Foreign real estate purchasers are enjoying the current smorgasbord of cheap real estate. According to the 2010 National Association of Realtors (NAR) Profile of International Home Buying Activity Report, foreign real estate purchasers made up 4% of the US real estate market (accounting for $41 billion of the $907 billion market). International buyers were made up of people from 53 countries, with Canada leading with 23%. These buyers were reported in 39 states; however 53% of these buyers were concentrated in the states of Arizona, California, Florida, and Texas. The number of Canadians buying property in Arizona has increased over the past few years.
Why are so many Canadians buying property in Arizona?
This article will highlight the 3 top reasons behind this trend. Those include a desirable location, reasonable home prices, and a weakening US dollar.
1 - Desirable Location
What is better than relaxing outside around the pool in 70 degree weather enjoying a beverage? Being able to do that in December. One major draw for Canadians deciding to purchase real estate in Arizona is the climate. A desirable location accounted for 45% (the most of any category) of a foreign purchaser's reason for purchasing property in the US. Arizona is one of the most desirable locations in the US. The fantastic weather, hundreds of prime golf courses, a major league baseball spring training mecca, and slew of shopping and eating establishments have consistently ranked Arizona as a top vacation destination. Canadians see Arizona as a reprieve from the cold, snowy winters.
The most popular times for Canadians buying property in Arizona is from October to March. Here are the average temperatures (C) in Phoenix, Arizona during those months:
October - Hi 31, Lo 17 November - Hi 24, Lo 10
December - Hi 21, Lo 7 January - Hi 19, Lo 7
February - Hi 22, Lo 9 March - Hi 24, Lo 11
In comparison to the average temperatures (C) in Calgary, Alberta:
October - Hi 13, Lo -1 November - Hi 3, Lo -9
December - Hi -2, Lo -14 January - Hi -3, Lo -16
February - Hi -1, Lo -12 March - Hi 3, Lo -8
The tagline that sums it all up is 'No snow shoveling required!'
2 - Reasonable Home Prices
The recent collapse of the US housing market has paved the way for truly amazing deals on Arizona real estate. With some home prices dropping over 50% since 2007, Canadians are taking advantage. Think of a popular department store advertising a 50% off sale. How many shoppers would flock to load up on everything from shoes to suits? In terms of real estate, everything from condos and homes for first-time homebuyers to multi-million dollar properties are deeply discounted. This market won't stick around forever. However with foreclosures increasing the shadow inventory of banks there is reason to believe that the market has a ways to go before improving. This year, 2011, there will see an increase in activity from Canadians buying property in Arizona, especially because confidence levels are increasing. The Arizona real estate market will recover, so the mystery is not 'if' but 'when'.
3 - Weakening US Dollar
The third reason why there are so many Canadians buying property in Arizona is due to the weakening US Dollar, compared to the Canadian Dollar (Loonie). According to a NAR Home Buyer Seller Survey, 79% of respondents indicated that changes in the value of the US Dollar have an impact on international sales. Currently, 1 Loonie is equal to 1.0366 US Dollars. This is a big deal for Canadians looking to invest in the US. If a Canadian investor is buying a single family home in Arizona for $100,000 US Dollars, it would cost them $96,470 Loonie. That would mean a 3.5% discount just in the exchange rate. With the Federal Reserve Bank printing money faster than at any time in history, it is hard to foresee the recovery of the US Dollar anytime in the near future. No matter what money is being spent on, whether it is purchasing real estate, shopping, eating out at restaurants, etc., the benefit of the weakening US Dollar is apparent.
As this article has illustrated, there are some key reasons why the number of Canadians buying property in Arizona is on the rise. Great weather, many outdoor activities (especially things that can't be done during the cold, snowy winters of Canada), real estate that is on sale, and a discount on anything purchased compliments of a weakening US Dollar all make it a wining situation for foreign investors from Canada. Now that the decision to purchase real estate in Arizona is evident, now what? The next step is for Canadians buying property in Arizona to find the right real estate agent. An agent that คอนโดมือสอง กรุงเทพ can assist in locating a property that meets their needs and that has experience dealing with Canadian buyers.
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