U.S. investment offers more cash flow than Canada
by Jennifer Paterson19 Feb 2015 – Canadian Real Estate Wealth
Despite a falling loonie, investing in the U.S. property market still offers more guaranteed cash flow than investing in Canada, say experts.
“Positive cash flow is really easy in the U.S.,” said Mike Wolf, a Canadian investor who focuses on the U.S. market.
“When I first started investing in the U.S., there were very few Canadians investing down there. It was around nine years ago, our dollar was at around 0.70 cents and the homes were a lot more expensive than they are now.
“Then the recession kicked in, and all of a sudden, all the Canadians wanted to get on board because the dollar went to par and the houses went up for sale down there.”
Chad Urbshott, an investor and founder of EquiGrowth, was worried about the rising prices in Canada around two years ago.
“It was harder to find positive cash-flow properties here,” he added. “The returns were not equal to the risk, so I started to look down south.”
There is still time for Canadians to get involved in the U.S. investment market. After all, Canadians purchased USD$13.8 billion worth of U.S. properties in the 12 months leading up to March 2014, according to a report by the National Association of Realtors.
Favourite spots include Arizona, California and Florida. In fact, according to a recent report by BMO Financial Group, more than 500,000 Canadians own real estate in Florida alone.
The BMO report noted that, compared to record-high prices in hot Canadian markets like Toronto and Vancouver, residential prices in the American Sunbelt are still attractively priced.
Chad Urbshott will be joining a panel at CREW’s InvestorForum, discussing opportunities in the U.S.
The event will be held March 28 and 29 at The International Centre in Toronto. Register here
Also, look out for the March/April issue of CREW, currently on newsstands, for a full report on investing in the U.S.