Guy Dubreuil has drawn a roadmap for the coming years , and the needle of the compass points strongly to the south : he plans to purchase a condo in Florida. “I would like to rent it for four years and then settle there six months a year , taking my retirement ,” says Laval amateur golf and motorcycle.
But there are still bargains to Uncle Sam, now that property prices are rising and the Canadian dollar weakens ? will he demand.
In recent years, plummeting property prices across the United States and particularly in the Sunshine State, combined with a strong dollar has enabled many Quebecers to grab a property under the palms for a song bread . La dolce vita in warmer climes was no longer the preserve of the rich.
“Last year , you could find condos for less than $ 30,000 that were worth $ 100,000 a few years ago, says Yves Beauchamp , realtor and owner of Le Soleil Florida . Half the people who bought in recent years would not have been able to afford before the crisis. “
In the roller-coaster ride that has shaken the U.S. property prices in recent years, Florida has the lead car . It is in this state that prices have climbed faster and higher in the mid- 2000s, then plunge precipitously in 2011. Then, the ride has regained momentum : the value of properties is now bullish .
“Florida has been more affected than all other states by the housing bubble, says Francis Generous economist for Desjardins. Prices have tripled between 2000 and 2006. The fall was therefore sharper than elsewhere in the United States . “
Many owners have found themselves in trouble, and Florida has turned into a huge “liquidation” . Buyers from around the world rushed to get their hands on the best deals, including a large number of Canadians.
This is also what drove the real estate market recovery . ” Properties are sold above the asking price , because there are sometimes multiple offers on the same property ,” says Jean Feuillet, real estate agent in the Fort Lauderdale area .
The best deals are probably past . The Canadian dollar down also increases the cost of purchase: for a property of $ 150,000 , the change of the currency represents an additional expense of $ 14,250 compared to 2012.
Treasures to find
Should we conclude that the train has passed and those who remained on the platform have to stay at home in the cold? Not necessarily .
“You may not come across the deal of the century, the golden opportunities are a little harder to find, but there are still says Yves Beauchamp . Although prices have increased, there are still good opportunities. “
“Despite the decline in the Canadian dollar , buyers know they are still a good deal, says Jean Feuillet. A condo built in the 80s who then sold $ 100,000 now sells for $ 120,000 . With inflation , it is as if it cost $ 40,000 in 1980 dollars . “
Property values continue to increase , but at a slower pace. “We do not expect to return to the same price as before the crisis for several years ,” says Francis Generous . The Canadian dollar , experts do not expect significant fluctuations in its value in the months ahead.
“Quebecers who buy to enjoy themselves for several years and not to invest should not have fears. The important thing is to pay a price that suits their budget , says Generous . But those who buy thinking make a lot of money maybe take risks. “
Of particular note is that the real estate market in Florida is still struggling with a large number of homes seized by banks , and third mortgages exceed the value of the property , owners who sell so do not get a enough to repay their mortgage rates .
Jean Feuillet warns buyers who might be tempted by condos advertised at extremely low prices , including those sold by banks : they may be in poor condition , or located in unsavory areas . ” The very low prices have attracted other types of buyers , demography has changed in some areas , and this is perhaps not what Quebec snowbirds looking for,” he said.
Sylvie Champagne, a Montrealer who bought a first condo in Fort Lauderdale area in 2006, observes that the popular sectors of Quebecers are somewhat protected bursts real estate market. ” The criteria for these buyers are not the same as traditional buyers, she said. Although Quebec retirees looking for apartment complexes where they can speak French , which supports demand in these sectors. “
Favorite places Canadian buyers :
Naples -Marco Island: 13%
Cape Coral -Fort Myers: 12%
Orlando -Kissimmee : 12%
Brandenton – Sarasota- Venice : 10%
Fort Lauderdale : 8%
Tampa- St Petersburg -Clearwater : 8%
Palm Beach : 6%
The choice of Sylvie
After a few trips to Florida and camping at the hotel over the years , Sylvie Champagne and her husband were tempted by a first condo they bought in 2006. Then a second , three years later … Then a third , there is a year!
Here are the reasons for their choice :
1st purchase, April 2006 – $ 70,000
Margate, north of Fort Lauderdale, 30 minutes from the ocean.
Condo one bedroom in a popular complex of Quebecers .
They bought when prices were at their peak .
“We have been in contact with the owner by an acquaintance and paid a price that was just in that moment and that suited our budget ,” says Sylvie .
2nd purchase, December 2009 – $ 105,000
In the same complex as the first.
Two bedrooms and two bathrooms.
The place need renovations of $ 12,000 .
At that time , prices have begun to fall , but are far from being at their lowest .
“We wanted more space to be able to entertain family and friends , and to spend more time working remotely ,” says Sylvie .
The first condo was leased .
3rd purchase, January 2013 – $ 320,000
Boca Raton, a little further north, in front of the ocean
Two bedrooms , three bathrooms , pool, gym , spa, underground parking.
“We wanted to get closer to the ocean and have more space , says Sylvie . We could never afford such a property a few years before , when prices were more around $ 600,000 . Our purchase has appreciated in value since last year , since it is a fairly sought . “
The other two condos are rented with a small profit .
” They probably sell when prices have increased , but there is no hurry ,” said Sylvie .
User manual for a purchase without worries
Here are 10 things to consider before buying Florida.
1 . Transaction costs can reach 2000 or $ 3000. Future owners may need , depending on the county pay for the title search , obtaining title insurance and inspection. By cons , it is the seller who pays the property transfer tax ( $ 7 per $ 1,000 of sales price) .
2 . A mortgage loan from a U.S. bank will be accompanied by a registration fee of $ 0.35 for every $ 100 borrowed . The process can be long and difficult , prompting the majority of snowbirds to pay cash for their purchase , often réhypothéquant their property in Canada. It is easier to negotiate at the time of purchase.
3 . If you fear the fluctuations in the exchange rate between the filing of your offer and closing the sale , you can convert the amounts necessary for your purchase in advance. Exchange companies also help block a few months in advance favorable interest rates and reduce the cost of remittance .
4 . An interview with the owners’ association is often required for the transaction to be approved, and that you are informed of rules to follow . It also requires a credit check and a criminal investigation. These steps may take about a month .
5 . Condominium charges rose in some areas affected by the housing crisis , because owners in financial difficulty could not pay their share . Other owners have had to clean the invoice . The maintenance of some buildings may also have suffered from financial problems of condominium associations . These problems are generally less important in the complex for 55 years and over who have suffered less from the crisis. Remember , if the selling prices have declined, condominium charges have not necessarily followed the same trend .
6 . Municipal taxes are generally lower for a permanent resident of Florida for an alien who has his main residence elsewhere , because of measures taken to avoid excessive increases in property taxes when the housing bubble. Do your calculations accordingly.
7 . Insurance much more expensive since the hurricanes of 2004-2005 . Insurers refuse to cover certain areas , forcing the owners to turn to the insurer of last resort established by the state, whose rates are higher.
8 . If the property is rented out , the rental income may be taxed in the United States and Canada, with the ability to claim a tax credit here for the amounts paid to the IRS . Many homeowners associations regulate the location, for example by prohibiting rent during the first year after purchase , and imposing a limit of one rental per year.
9 . By selling your property, you will , again, be taxed on the capital gain in the U.S. first, then Canada for the excess. Here you can claim a credit for taxes already paid south of the border.
10 . If you live in Quebec at least six months in the year, you continue to be covered by the Quebec health insurance plan . But if you have spent an average of 122 days per year in the United States for three years , you may be considered a resident in the eyes of the IRS