Due to the condition of the United States housing market, home prices are lower than they have been in a number of years. This has resulted in a number Canadian citizens who have been purchasing a second homes in the United States. If you are a Canadian citizen considering a home or condo purchase in the United States, there are a few things you should consider.
You must be a U.S. citizen to buy a U.S. property as a primary residence. However, non-citizens can purchase a property as a vacation residence or for investment/rental purposes. There are also VISA rules which indicate that non-citizens cannot stay for over six months at a time. For more information on VISAs you can check the US Government VISA information on their website.
In terms of title transfer and fees, the transaction is basically the same as it is for a U.S .citizen making a purchase of property in the U.S. However, there is an extra charge of about $15 for international money wires and additional time needs to be allowed in the escrow period to allow for international mailing of documents.
Although there are no U.S. tax issues for purchasing the property, you would have some U.S. taxes due when you sold the property. If you have questions about this you should speak with an accountant familiar with U.S. tax rules. I also recommend that you talk with your accountant regarding the implications of purchasing in the U.S. for your Canadian taxes.
You should consult with a lender in the U.S. as well as a lender in Canada to compare rates and costs of loans. It is best to have a conversation with a lender before looking at houses so you know how much cash you will need to put down on the loan, what loan costs will be, and the amount of a loan for which you will qualify.
This information applies to people who would be purchasing as an individual or individuals and not as an entity. If you are planning on purchasing as an entity, some different regulations would apply.
Amy Monahan, CRS, GRI, MBA
West USA Realty, Mesa, AZ
Amy has been awarded the prestigious Certified Residential Specialist (CRS) Designation by the Council of Residential Specialists, the largest not-for-profit affiliate of the National Association of Realtors. Realtors who receive the CRS Designation have completed advanced courses and have demonstrated professional expertise in the field of residential real estate. Home buyers and sellers can be assured that CRS Designees subscribe to the strict realtor code of ethics, have access to the latest technology and are specialists in helping clients maximize profits and minimize costs when buying or selling a home.