For nearly 19 months, the Canada-U.S. land border was closed to non-essential travel. In November 2021, fully vaccinated travellers were once again allowed to enter the U.S., and travel began to pick up immediately. As of February 2022, the largest increase in arrivals into the U.S. was among Canadians.1
Just as they enthusiastically travelled back to the U.S., Canadians began investing in U.S. real estate again, making up the largest share of foreign U.S. property buyers. In the first few months of 2022, Canadians spent $5.5 billion on U.S. real estate purchases.
Florida remains the top purchase destination
Florida has long been a prime destination for Canadian travellers as short-term vacationers and snowbirds who enjoy an extended winter stay. As temperatures dip north of the border, the Sunshine State’s warm weather broadens its appeal to Canadians. So when it comes to purchasing real estate, it’s not surprising that Florida is again top of the list.
According to a National Association of Realtors® 2022 study, for U.S. real estate property purchases by Canadians:
- 45% were in Florida
- 23% were in Arizona
- 12% were in California
Canadians are primarily buying vacation properties
According to the same NAR study, 44% of all foreign buyers of U.S. real estate purchase a property for use as a vacation home, rental home or both. Comparatively, 58% of Canadians are more likely than the average foreign buyer to buy U.S. real estate for vacations.
While most Canadian buyers purchase detached single-family homes in the U.S., they are also the most likely to purchase condominiums.
Despite price increases, U.S. homes remain affordable for Canadians
The rate of home sales in the U.S. began to slow in early 2022, falling nearly 6% compared to the same period last year — likely in response to rising mortgage rates. Even so, there is more demand than supply in the U.S. real estate market, so home prices have continued to rise. The median sales price for an existing home reached $391,200 USD in April 2022, up almost 15% over last year.
Still, the prices for single family homes in the U.S. remain more affordable than the cost of property in Canada. For example, according to the Global Property Guide for prices in global cities, the median price of a home is $530,000 USD in the Miami/Fort Lauderdale/ West Palm Beach region — or $3,170 per square meter. In Toronto, the median price per square meter is $10,947 USD. So far, in 2022, Canadians are paying an average of $485,000 for their U.S. properties.
On a recent episode of Go-To Grandma, Kathy Buckworth sat down with Alain Forget, Head of U.S. Sales and Business Development at RBC Bank, to discuss the current state of the U.S. real estate market. Tune in at the 18:00 mark to hear Alain’s insights on the U.S. real estate market and find out where Canadians are buying U.S. real estate these days.
Buying U.S. Real Estate: The Rundown
While the U.S. real estate market is experiencing some of the same challenges as the Canadian market – higher prices, increasing mortgage rates and rising demand – Canadians are still buying U.S. properties. As the U.S. remains the most popular destination for Canadian travellers, many are investing in their favourite U.S. spots, purchasing vacation homes and condos in Florida (primarily), Arizona, and California to enjoy longer stays south of the border.
1 National Association of Realtors®: Profile of International Transactions in U.S. Residential Real Estate 2022
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