Canadians Buying Homes Abroad
When it comes to purchasing property, a lot of questions and answers need to be resolved. This is even more true for Canadians who wish to purchase a house in the United States. The US real estate structure and market can be very different than that of Canada’s. Buyers need to step carefully and make decisions wisely. Whether you’re buying for financial benefits or residence necessities, the research you must do prior to purchase is the same
One common mistake that many buyers make, not just Canadians but any buyers in general, is that they only consider the cost of the property and don’t look at anything else. For them, low price equals a good deal but that is not always the case which is why if you are a Canadian hoping to acquire property in the US, you must consider all aspects outside of the home purchase.
For this article, we will look at buying a home in Arizona as this is a common relocation state for many Canadian snowbirds, retirees and business advocates.
Initially, start off with considering your reason of purchase. Are you looking for a lifestyle change or is this going to be an investment? Then, no matter what your reason may be, keep in mind the taxes that you will be faced with. Getting professional advice regarding taxes and land transfer to non-residents will ensure that you get the best deal and the most accurate information. You do not want to pay taxes in both countries, miss necessary fees or overpay on the US side.
Then you focus on the location. If you have decided on Arizona then where in Arizona exactly? Getting help from alocal Arizona realtor is a great choice as they can tell you about local area market trends, supplementary services that are available in each area etc. Additionally, ask your realtor if you are eligible for any financing programs that are provided to Canadians for buying property in the US.
Locations to Consider
Many Canadians, especially the ones who are looking to retire in USA, go for the Phoenix Metropolitan area, for many reasons. There is an abundance of residential properties to buy and residents can enjoy a good environment with many amenities such as restaurants, shops, golf courses and outdoor activities like hiking. Phoenix is also a good option for those who are considering buying a house in the US for investment options, especially those looking to purchase more than one property.
For the people that will not be living in the US full time, then Scottsdale area would suit them well, where the homes vary in types and price range.
After all your basic considerations have been conducted, you work with your realtor to decide on a good deal, what price you will offer, etc. When you are deciding upon your offer, make sure to remember some essential aspects like down payment, closing date, loan interest rate, warranty for the property, expiration of contract, extra/special terms and conditions, etc.
Note: In Arizona, you get the added benefit of not having to attain lawyer services for making real estate transactions. This saves you the cost of having a lawyer.
You can work together with your realtor to carefully consider all aspects and make the best deal. If you do not have a high knowledge of the US real estate market then it is best to hire a local realtor. A good realtors will ensure fast, simple and smooth processes.
FAQs Regarding Canadians Purchasing Homes in Arizona, USA
While you may have a realtor to help you with the purchasing processes, it is still best to consider basic questions that all Canadians are concerned about when they buy residential properties in the US.
Some of these common F AQs are:
- If I buy a property in the United States but remain a Canadian citizen and live in Canada, will I have to pay state tax?
- Yes, anyone who owns a property in the U.S. is subject to tax. If you rent a property, you will be subject to income tax rental income. If your property is for seasonal visits, even then state tax is obligatory to be paid.
- Can I avoid US property taxes?
- A tax advisor in Arizona will be able to assist you in this manner regarding any options for this. It is necessary that you consult one if you wish to avoid property taxes and this planning should be done before making a purchase.
- I am a Canadian citizen, looking to buy another residential property in Arizona. Is that possible?
- Yes, Canadian citizens can purchase more than one property in Arizona, assuming they pay the taxes and pay cash or finance their second purchase.
- How is buying a home in Arizona different than buying a home in Canada?
- While the real estate market varies in the U.S., in Arizona, you will find it easier to purchase a home as it will take less time for all the processes to complete. Additionally, you may find residential properties here cheaper than those in Canada. You will not be required to have lawyer services for your home purchase in Arizona. If you want, you can complete the processes and forms from Canada and email or mail the documents to Arizona.
- When can I move into my purchases property?
- A month is more than enough for cash purchase transactions. For mortgage properties, it can take up to 6 weeks, but that can vary.
- Can I rent out my property and live in Canada? If yes, who will collect and pay the tax?
- It is usually allowed to rent out your property but this needs confirmation from your realtor and the community your property is under. The tax is paid by the tenant of the property and it is combined with his monthly rental charges.