Many people have been spending the winter in Phoenix, Scottsdale, Mesa, Queen Creek when the weather is perfect here and very cold and miserable in other countries. This is particularly true of our Canadian neighbors, which at times are affectionately referred to as Snowbirds.
Many snowbirds have been escaping to the Valley of the Sun for many years. They have been paying exorbitant rental rates for the high season and have been committing to the property a year in advance in order to secure the rental. This year seasonal rentals are very expensive and scarce because of the Super Bowl and the Waste Management Phoenix Open occurring the same week, along with the Barrett Jackson Auction. Now may be the time to look at the opportunity of purchasing a second home in the Valley of the Sun.
Our Canadian Home Buying Expert Deb Gordon
Home Loan Incentives - Get A $1295 Closing Cost Credit On Your Loan
Address: 8502 E. Princess Dr., Suite 180 Scottsdale, AZ 85255
Thank you for visiting our site today. Here you will find the most current city homes for sale listed on the MLS. To refine your home search, click on the tab underneath to change home price criteria or bedrooms and bathrooms. You can also refine the properties criteria by listing date or property status. This will give you the most recent listings to hit the market in area. If you have any concerns, please feel free to give us a call or fill out the contact form at the bottom of the page. Our local real estate agents would be happy to facilitate in any way they can. We are here to help and make every effort to earn our customers trust by bringing local city knowledge and value.
Owning Versus Renting For Canadians
With rents being so high and availability limited I wonder why repeat renters and committed snowbirds do not jump at the opportunity of owning their own condo, patio home, townhouse, lock-n-leave or single-family dwelling, especially if you are considering retiring here. The facts are that this the perfect time to buy. There are approximately 28,000 available properties, interest rates are still down, the Canadian dollar is strong and there are more loan opportunities with the merger of the Bank of Montreal and Harris Bank.
All this being said there are a few facts that Canadians buying in the US should consider and make some decisions on. The first question that you must ask yourself – Is the property going to be used as a second home, an investment or a vacation home? Your lender will need to know this information to determine which loan program will fit your needs best.
If you are a Canadian who spends less than 121 days in the U.S. in any year, you are not considered a U.S. resident for income tax purposes. However, if you stay longer than 120 days without proper tax planning, you may have the joy of paying income tax in both countries. There may be ways to avoid this, but you need to find a professional tax advisor who is familiar with both U.S. and Canadian Tax Codes. It is much better to understand the correct procedures up front or to return to Canada on the 119th day just to be safe.
If you plan to live in the property part of the year and leave it vacant the rest of the year, you have many choices, some income producing. With 8.8 million visitors in Arizona a year we can accommodate everything from a local representative, vacation rentals only to a full service property manager.
GET ADVICE on this... if you are planning to rent the property out for all or part of the year, the U.S. IRS may consider you a "non-resident alien" and require you to pay U.S. income tax, Arizona income tax and city rental tax on the rental income. I have also been told that there maybe a 30% withholding on the rent you collect.
I have also been told you can avoid this withholding tax by filing a U.S. tax return and paying tax on net rental income after such expenses as mortgage interest, property taxes, insurance, maintenance and repair, and property management have been deducted. Be sure to get a professional opinion on this.
As a foreign property owner you are subject to the Foreign Investment in Real Property Tax Act of 1980 or FIRPTA a mandatory tax withholding of 10% of the gross sale price. Like everything in life and especially with the government there are a few exceptions: the sales price must be under $300,000, the purchaser plans to use the home as their residence or a withholding certificate is obtained to show the tax amount owed is less than 10% of the gross sales amount. A foreign person is a non-resident alien individual; a foreign corporation not treated as a domestic corporation; or a foreign partnership, trust or estate. A resident alien is not considered a foreign person under FIRPTA.
The Bank of Montreal advises Canadians to understand the differences in mortgage financing between the U.S. and Canada and how interest is charged in the U.S, so please check with your Canadian Lender for your best option in the US.
Real estate is all about location, location, and location and although Canadians have always favored Arizona, choosing the right location for your vacation or investment property is crucial. Such as a lock-n leave or adult active community. You need the services of a trusted Realtor who knows the areas and can direct you to the neighborhoods that will give you access to the things that you enjoy: hiking, biking, swimming, restaurants, scenic views, shopping, low HOAs, night life to name a few.
I recommend that you contact The Bank of Montreal or use Canadian Banks established in the U.S., Canadian bank subsidiaries or U.S. financial institutions that have ties to Canadian banks loans.
Be sure to contact Deb Gordon for all of your real estate needs. It is never too early to investigate and see what your options are.