The U.S. real estate market is a “hot spot” for Canadians who want to flee from the frosty conditions during winter.
These individuals are referred to as “snowbirds”. The goal of snowbirds is to purchase a shelter for them to stay in during the cold season.
With the cheap prices of properties in the States, U.S. real estate has become popular for snowbirds.
Their tendency is to buy without learning the facts about U.S. real estate. Here are some tips that will aid you in purchasing your second home:
- Personally check the U.S. real estate property you are planning to purchase before deciding on taking it. See the surrounding areas and if you intend to lease your property, make sure that it’ll be worth it. A desirable location for your property would be near recreational and tranquil areas like the malls, beaches, and medical facilities. Then, the last requirement when collecting rentals from a property would be to file a U.S. tax return.
- Knowing the proper way of titling a property you bought in the U.S. real estate is also a must. This will also give you an idea on the different types of ownership – one is joint ownership. Merely buying a U.S. real estate property does not mean you need to file a U.S. tax return. This is only required on properties leased.
- Financing a property in the U.S. with a U.S.-based financial institution is recommendable. Enough knowledge and awareness of mortgaging in the U.S. is indicated when securing this type of financing. It is better to deal then with a Canadian-owned for an easier cross-board financing.
- Back then, the Canada-U.S. Tax Treaty was made and implemented. This treaty will prevent property owners, both local and foreign, from paying on two countries at the same time. Thus overriding the bylaws of U.S. and Canada, and reduce tax bills of those Canadians who own U.S. real estates and vice versa.
- Various appealing propositions were offered to retired Canadians that will give them numerous opportunities to get a high and tax-free interest returns. Canadians find this more attractive, for the cost of living for retirees in Canada is very expensive comparing to the United States. This is why more retired Canadians wants to move and are moving to the U.S. because of the strong and high value of Canadian dollars.
- When exchanging currencies, it is more practical if you consult and see different institutions, banks or brokers offering the best rates. This is to ensure a better transaction. Then, when exchanging currencies, also consider doing it at one instant only and with a larger amount so that you may ask for the exact spot rate. It is better to go see reputable currency exchangers or brokers to avoid regrets.
- When foreign individuals stay in the United States, they are only treated legally as visitors and are only allowed for a certain number of days. If that individual exceeds for the number of days he/she stays, taxes may be set to pay for. Meanwhile, if foreign individuals are staying for 6 months or more for educational or job purposes, a corresponding and appropriate visa is of necessity.