FREQUENTLY ASKED QUESTIONS

No. In Florida, Canadian property owners are subject to the exact same income tax rates as any other owner, including United States owners. When it comes to property taxes, the rates are also the same, but Florida residents have lower property tax assessments on their primary residence (the state provides a homestead exemption up to $50,000).

No. While Canadian investors in United States rental properties must file their United States tax under the same IRS rules for rental income as a United States resident, Canadians can claim foreign tax credits in their Canadian tax filings. This means that the taxes paid in the United States (which are typically lower than what would be owed in Canada) can be credited on your Canadian taxes owed, effectively only applying the Canadian taxes.

The easiest, and usually the cheapest, way for non-United States investors to obtain financing for United States real estate is by using the equity available from non-United States real estate. We can help connect you with excellent mortgage brokers who can assist you with available foreign national financing options for your situation.

While property prices have a very wide range, we suggest looking at a price range of $350K to $400K. From our experience, cheaper properties, those below $350K, are typically smaller properties that are either not fit for an average family’s needs, are older properties in need of ongoing repairs or renovations, are in poorer locations, and attract lower caliber of tenants. More expensive properties, on the other hand, typically have a much smaller pool of renters leading to a lower return on investment and longer vacancies.

Not everyone has access to this much capital, and there are strategies that can still allow you to own United States real estate. One of the most common strategies is to partner with friends through a limited partnership for your investments. You can include one or more partners to reduce the amount of capital required, and the ownership structure could be as flexible as you want it to be – a 50/50 split is just one option.

Some people believe that they missed the boat by not investing shortly after the real estate market collapse in 2007/2008. While it is true that real estate prices in most cases have increased significantly since that time period, it is important to recognize that rents have as well. This means that the return on investment (or the cap rate) remains very attractive and in many cases even more so than in earlier years.

Insurance is not required by law. Depending on an investor’s risk tolerance, they have an option to purchase insurance as well as the type of coverage. In our lease agreements, we require all renters to purchase a renter’s insurance policy that offers significant benefits and protection to both tenants and owners. A typical renter’s policy includes personal property coverage of $15,000 and personal liability coverage of $100,000. Some Florida real estate owners choose to purchase additional flood coverage to protect from hurricane induced storm surges. We can help connect you with excellent insurance brokers who can assist you with different policy at market leading rates.

We assess the attractiveness of any real estate investment based on the following factors:

1. Current and historical price levels;
2. Demand and vacancy rates;
3. Rental yields and cap rates;
4. Prospective economic growth and housing sector activity;
5. Build quality, condition and age of residential real estate;
6. Tenancy laws and ease of doing business.