housing market continues to plummet, increasing numbers of savvy Canadians
are embracing a new, money-saving strategy - cross border real estate
The financial benefits can be stellar. In fact, according to a panel of
experts who spoke recently at the Vancouver seminar entitled Buying in
Washington State and Beyond, current market conditions make it tough to
actually find a downside to investing south of the 49th parallel.
Most immediately apparent, with the dollar effectively at par and expected
to remain there for the foreseeable future, Canadian money simply buys a
whole lot more house than it does in our still overheated Lower Mainland
marketplace. New supply is also becoming more diverse and upscale as
developers react to consumer demand for sophisticated product with a
contemporary edge - especially in the burgeoning condo/hotel sector.
In this new market place, Vancouver's sister city of Seattle is gaining ground as an
investment location of choice thanks, in large part, to a vibrant economy and proximity to a plethora of amenities. "Seattle is consistently ranked one of nation's most desirable cities," notes Dean Jones from Seattle-based Realogics, a company specializing in real estate market research and prod-uct development
throughout the Pacific Northwest. Small wonder considering Seattle hosts
more than 200 large-scale events annually, is visited by many cruise ships
every year, and is home to five professional sports teams, seven museums,
plus more than 55 art galleries.
More good news U.S. law, unlike its Canadian counterpart, prohibits
mandatory or exclusive rental programs even in the increasingly popular
strata-style hotel condominium -an owner may rent their property to whomever
they like, whenever they choose, either privately or through the in-house
rental program - thus further enhancing the appeal of a vacation/secondary
property that helps pay for itself over time.
Still, Dennis Archer, owner of the Archer Group and a specialist in
cross-border real estate transactions, cautions that while he believes this
an excellent time for Canadians to purchase property in the United States,
it is crucial for any investor to seek professional advice on the many
nuances differentiating Canadian and American law.
Inheritance taxes that kick in upon death of the owner, possible
restrictions on assignment sales, and the requirement to declare a rental
election on your first U.S. tax return if you are planning to use your
property as a revenue generating investment are just a few of the
However, the panel was unanimous in its overall assessment: Whether you're
looking for a more favourable tax structure, legacy building, portfolio
diversification or you'ie simply a snowbird searching for a vacation home in
a warmer climate, now is a great time to turn your attention south for solid
real estate investment potential.
- Susan M. Boyce, 24 hours