Denver Estate Real
Many Canadians dream, in the south for the winter, but not only to beat the cold. You need to invest in real estate on their minds. Our strong dollar combined with a collapse of the housing market in the U.S. spells opportunity for many. But Canada and the United States are not the same country, and what we have in common, we have differences. Each investor money Canadians see the United States must have a basic understanding of some key differences betweenBuying a property in Canada, compared to a purchase on So, before you put the spinner in Florida or Texas to get started, read on.
Denver Estate Real
Control Systems:
Denver Estate Real
Talk to a tax consultant who has experience with real estate investing in the U.S. that countries differ with respect to the taxation of property investment.
Denver Estate Real
United States
1031 exchanges to obtain capital gains from the sale of investment property helddeferred and rolled up into a purchase of a similar type of property when purchased within 180 days. This can often be deferred capital gains, at the end of an asset is final and not be replaced; If capital gains are realized (the property is sold and the collection), the seller is 15% of the total net income (provided that the property has been taxed more than a year, if significantly lower rates above); Property taxes are generally similarthose in Canada, but if you are a Canadian-owned and just in a state like South Florida or California, you can be much higher "non-residents' property taxes and the room or if you invest in other Member States of United States; Similar to Canadian tax laws will not be taxable on your principal residence, but the United States, you can deduct the interest charged on your home page.
This contrasts with Canada
Sell your real estate investment in Canada, you have to pay capitalgains tax to 50% of net income. Canada is not yet possible to extend the gain from an exchange. The "profit" or "loss" is added and the income is taxed at the rate in force (which could be much higher than normal rate of 15% in the U.S.); Similar to that of the United States in relation to your expenses can be written in taxable income to the ownership of capital goods such as billing related. See the previous two articles to tax-time tips: Part 1 and Part 2
Before theSouth Loon this winter:
Whether it's "non-residents' property taxes in the city / country you are considering; If (not buy and use another Exchange 1031-strategy) is already in the States and the sale of the property you are obligated to pay U.S. taxes on sales. You pay only the first of the United States, but the statement of income in Canada (taxes paid in the United States) files. So, you have to pay once (you will receive a tax credit to CanadaTaxes), but there are two shoulders (February / March 2008 Money Sense has an excellent article on this topic) files; Rents are two deposits for taxes, too. You must claim the income (and costs) in both countries pay taxes and receive a credit card for your Canadian taxes.
The differences in lending between Canada and the United States:
The "credit crunch" or "collapse of the subprime market" has had a dramatic impact on the credit in the United States and sunk inBorder with Canada. Because of the economic crisis, lenders have changed dramatically in the guidelines and policies of both countries. United States, there were almost as many loans to all applicants. The term "Ninja" loans were invented in the UP The acronym stands for "no income, no job, no assets." Many people were given mortgages beyond their means. While the first important phase of ARM (adjustable rate mortgages), to raise prices started foreclosures started popping up all over theNation. Canadians should not fear the same here by chance loans very different environments.
United States
Hundreds of banks across the country with hundreds of differences in credit policies and guidelines; License varies for each state, which can be a mortgage broker. Some states do not test or license is for everyone! Banking regulation is regulated at federal and state, which in turn may be less stringent lending criteria aBank or institution to another.
And Canada
A bank controlled by the state law controls what banks can do and what not to do across Canada; Only five of Canada's largest banks control the majority of all departments of the bank; All five major banks in Canada are able to raise money to pay mortgages, but have also acquired (and monitors) (for borrow money too) many trust companies and licensed broker; Mortgage brokers are regulated by the ProvinceCanada, most provinces require extensive training and successful test of a license agreement.
The economic conditions in the U.S. and Canada:
The Canadian economy continued favorable economic conditions, with unemployment at historic lows, higher wages and enjoy the appreciation of homes. At the same time, a recession in the United States in many areas of American experience houses hidden devaluation, unemployment and a worsening of the consumerTrust.
And 'possible to find some bargains in the U.S., such as seizures accumulate, devalue property / houses (even double-digit in some states - Florida, Michigan, California) continues, and our Canadian dollar parity with the dollar to sit. But before you start, do your research. Most economists still believe that we are in the midst of the subprime fiasco. They provide for the continued depreciation of the entire nation (of course much worse in some areasother) for the better part of two years. So if you really know an area is better soon, waiting for me personally, leading into summer and the beginning of 2009. The election, the war, the federal policy of "saving" for millions of borrowers credit and the worst scenario is expected to hit the subprime fall of 2008, all factors that influence investment in years and is a game of 'chance, not knowing what will happen to purchase.But with the strong dollar is a good time to go south, and noting that the dream house in Florida, right?
Some final thoughts (in this article anyway) on investments in U.S. real estate market, if you intend to purchase in the United States and are a Canadian citizen residing in Canada for three types of help to get the funding.:
A mortgage in the U.S. through a U.S. bank, RBC Centura like, or a Canadian bank-ownedMontreal Harris Bank; Purchase with all cash, so you do not have to deal with cross-border financing issues (for example, pulling equity from your home or other properties in Canada, or ask your rich aunt for money!) To purchase a lot to the south, and Starting a business in the United States with assets (a holding company will not work because they have the capital or income generation should), who received a mortgage from a lender in the United States.
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