Canadians who are considering buying property in popular snowbird cities south of the border (read: warm cities like those found in Florida, Arizona and Nevada) should act soon as prices remain far below peak levels seen in 2006, but are expected to begin to rise shortly.
“Now, with the American economy and employment gaining strength, home sales should gather some momentum,” said the senior economist for BMO Capital Markets, Sal Guatieri. “We expect prices to rise over time alongside growing family incomes. We also expect the U.S. greenback to ride moderately further against the Canadian dollar, boosting capital gains appreciation for Canadians who purchase U.S. property.”
According to BMO Bank of Montreal, approximately 500,000 Canadians own homes in Florida, where home prices are significantly lower than many Canadian cities.
The Chief Investment Officer for BMO Harris Private Bank, Jack Ablin, said that, “Florida properties are a bargain compared to real estate in Canada. The median priced home in Florida is nearly half that in Canada. Popular areas include Sarasota-Bradenton-Venice, Orlando-Kissimmee, Miami-Ft. Lauderdale-Palm Beach, Cape Coral-Ft. Myers, Tampa-St. Petersburg and Naples-Marco Island. We project retirement state housing prices to outpace the national average, due to increasing numbers of retirees, and abundance of capital from abroad and lower interest rates. Foreign buyers are interested in U.S. real estate because it’s relatively cheap when gauged against incomes and is situated in a stable/safe haven economy.”