As the Canadian dollar goes up and down when compared to the American green back, many people wonder what kind of real estate investment they could make going either way. If one was to look at purchasing power of sale properties in Brampton, would it be a better investment than doing so in Detroit? What kind of things should you look at when it comes to buying property internationally? Let's take a look at a few key points.
While you may have heard that the real estate in the United States is at an all time low, the truth is the prices did not bottom out everywhere. Major cities in wealthy areas continue to have very high price tags on real estate. New York and Los Angeles, for example, still list the average home at above $450,000. If you look at the average Toronto real estate listing, that's about a $150,000 difference. That of course depends on what the dollar is doing on any given day; we're basing it on a .90 Loonie compared to the US dollar (which is what the banks will try to give you, everyone wants in on the profit of exchange).
That means if you are selling with Sutton reality in the north and buying in a big city in the south, it is probably a bad investment. Not only are you still buying high, it is likely that you will have to sell lower. Prices in the big American cities are high mainly because people can't stand the thought of losing all the money they have invested. Even in New York and LA, and outlying areas such as Orange County, houses are not selling well. They just sit there while someone hopes to sell them!
In the medium size cities in the States, on the other hand, it is a totally different scenario. If you could only dream of purchasing property in Phoenix or another sunshine belt city upon the sale of your London Ontario property before, you need dream no longer. Sellers in these cities are getting desperate to unload the vacation homes they bought when times were good and prices high. The result is an incredible Canada US exchange rate on real estate transactions in formerly desirable cities such as Tempe, Tucson, and even Miami. The exchange rate is weighted heavily on the Canadian side!
So before you put your Brampton homes for sale with plans to head south, make sure you have thoroughly checked out the reality of the real estate picture in the area where you are headed. Not all home owners in the States are desperate to sell yet. Even in areas where prices have fallen, the market still may not be touchable for the average Canadian buyer.
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