Canadians Snap Up U.S. Properties

[REQRentals]

Sure,



https://www.youtube.com/watch?v=ZO1mR_N4OO4

 

[Rickson9]

[quote user=REQRentals]What State did you buy in?



I'm shopping off this list by RealityTrac.

 

[REQRentals]

Thanks,



Glad to see Tampa on there. Not married to Tampa but invest & manage there and like to see how it compares.



Funny how it speaks of the institutional investors as they made it very hard to buy for awhile. A lot of the foreclosure buying has slowed down however and good deals are coming available again. I cannot speak for anywhere else but cash sales are down 13% in Tampa while average price rose 23% in February.



There is another good one I saw recently with the affordability of new homes in various markets (price vs income etc...) which might help with upside projections. It is from last October but still relevant.



Basically that the markets that got killed are still affordable whereas the ones that did not crash have become priced out on the low rates.



Cheers

 

[Rickson9]

Here is another article that lists where some of the best rental returns can be found.



Also, shadow inventories that many early posters on this thread were crying about, have experienced double-digit declines for the last 16 months and have been falling for over 3 years.



For those who weren't paralyzed by fear and purchased rental property in the U.S., they are now reaping huge gains both in price and rent. Especially since the CAD quickly melted against the USD at the beginning of this year.

 

[Rickson9]

The following article looks at the US cities that have experienced that biggest increases in rents since the housing meltdown. Here is the list:

 

[Rickson9]

Warren Buffett's Franchise Brand Picks Up Nearly 2,000 More Agents In Phoenix, Las Vegas Markets


Warren Buffett`s real estate franchise brand, Berkshire Hathaway
HomeServices, can now claim nearly 28,000 affiliated agents in 37 states
with the addition of two brokerages owned by Henderson, Nevada-based
Americana Holdings.




The latest Berkshire Hathaway HomeServices affiliates ` Prudential
Americana Group Realtors in Las Vegas, and Phoenix-based Prudential
Arizona Properties ` have a combined total of nearly 2,000 agents
working out of 21 offices.

http://www.inman.com/2014/04/29/warren-buffetts-franchise-brand-picks-up-nearly-2000-more-agents-in-las-vegas-phoenix-markets/#.U2BsyVPLeFE





My agent in Phoenix was picked up.

 

[KevinSolomon]

Warren Buffett's Big Bet On American Housing

After U.S. housing prices had crashed, Warren Buffett of Berkshire Hathaway believed prices would quickly recover.
While Buffett has said that prediction was "dead wrong," but it turned
out to be mostly just "early." Home prices in most parts of the United
States are climbing higher as mortgage rates remain low and unemployment
rates fall.

http://www.fool.com/investing/general/2014/05/18/warren-buffetts-big-bet-on-american-housing.aspx

 

[KevinSolomon]

Investors have transitioned to flipping.



Phoenix No. 2 In The Nation For House Flipping



As home prices have climbed and foreclosures tumbled in recent years,
it`s been increasingly difficult for Phoenix-area home investors to
score a bargain.




But new research by RealtyTrac today shows that hasn`t necessarily been a deterrent for house flippers.



In fact, RealtyTrac said the Phoenix area had the second-highest
number of home flips in the nation between April 2013 and March 2014.


http://www.bizjournals.com/phoenix/news/2014/06/02/phoenix-no-2-in-the-nation-for-house-flipping.html

 

[KevinSolomon]

Why Millennial Professionals Are Excited About Arizona



When businesses decide where to start up or expand, one of the first
things they look for is an abundant source of young, smart job
candidates.



That`s been a major factor for technology-driven companies such as
Apple, ZocDoc, and Garmin, all of which have chosen to open offices in
Arizona ` in large part because of the strong pool of skilled and
available talent in the state.



http://www.businessinsider.com/sc/arizona-millennial-professionals-2014-6

 

[KevinSolomon]

Top 9 States Where Jobs Are BOOMING (Arizona Tied For Second Place)



Arizona


2014 Job Growth: 2.6%

2013 Job Growth: 2.1%

Jobs to Be Added: 71,539

2013 Population: 6,626,624






http://www.kiplinger.com/slideshow/business/T019-S010-states-with-the-fastest-job-growth-in-2014/index.html





Texas and Arizona are both slated to have 2.6% job growth in 2014,
partly due to their quickly expanding high-tech, energy and bioscience
industries. The housing market in Texas is improving, and Arizona is
recovering from its collapse as well.



http://www.businessinsider.com/states-hiring-new-jobs-2014-6

 

[3canctheayr]

Something to consider:



http://www.zerohedge.com/news/2014-07-02/how-few-wall-street-backed-firms-manipulate-entire-us-housing-market

 

[KevinSolomon]

Unless an investor is investing in the entire US housing market, it really shouldn't be something that they should consider.



I'm only investing in an infitessimally small number of US properties, so that article is pretty much as irrelevant as it could be.

 

[3canctheayr]

IMO, it should be something to look at for many US property investors, especially in the areas that a lot of people flocked to, such as AZ, FL, etc. Many people that had the sense to buy in 2010 have seen significant price appreciation since then. The article shows how some of the price appreciation was manipulated & that some of that price appreciation may disappear if/when the Hedge funds/PE groups start selling off..... It's hardly irrelevant, but it can be for you if you want to ignore it... Up to you.

 

[KevinSolomon]

[quote user=3canctheayr] IMO, it should be something to look at for many US property investors, especially in the areas that a lot of people flocked to, such as AZ, FL, etc. Many people that had the sense to buy in 2010 have seen significant price appreciation since then. The article shows how some of the price appreciation was manipulated & that some of that price appreciation may disappear if/when the Hedge funds/PE groups start selling off..... It's hardly irrelevant, but it can be for you if you want to ignore it... Up to you.





Anybody who purchased US property in 2010 like myself, is likely making 20% gross margins (when the CAD and USD were at parity). The price action at this point is largely irrelevant. And if the price happened to re-visit 2010 again, I would absolutely love it. It would be ridiculously fantastic especially now that I've done all the pre-work and all my connections are in place



With regards to ignoring naysayers, well, that's been the idea of the posts in this entire thread. And considering my record compared to the naysayers since, well, I think that ignoring their posts have been very good to me. Which is why most of them don't post here any more.



But I'm still...



[quote user=ChrisDavies]Giving the benefit of the doubt.

 

[Thomas Beyer]

Opportunities aplenty in a huge market with a1% population growth and huge oil production, now #1 in the world ahead of Russia and Saudi Arabia .. Beats socialist, union-friendly and debt ridden BC, Ontario or Quebec .. But not AB or SK for investing in many sub-markets .. We have done very well in the Dallas area but there are many other areas with enormous upside

 

[KevinSolomon]

[quote user=ThomasBeyer]...there are many other areas with enormous upside...





Speaking of this, apparently there still are places that offer 20% gross margins.



http://www.businessinsider.com/best-markets-for-renting-to-baby-boomers-2014-7

 

[KevinSolomon]

[quote user=KevinSolomon]Speaking of this, apparently there still are places that offer 20% gross margins:

http://www.businessinsider.com/best-markets-for-renting-to-baby-boomers-2014-7





Here are some more cities with 20% gross margins:

http://www.businessinsider.com/best-markets-for-renting-to-millennials-2014-7



And Canadians and the Chinese were the biggest buyers of American homes last year...

Canada was the biggest buyer in terms of transaction volume, but China was the biggest buyer in terms of dollar volume.



Sales from Chinese buyers climbed to $22 billion, accounting for a
24% share, up from $12.8 billion (19% share) the previous period.
Meanwhile, sales from Canadians accounted for $13.8 billion of 15%
share, compared with $11.8 billion (17% share) a year ago.



Chinese buyers also bought properties in more expensive markets like
New York, California, and Washington, while Canadians bought homes in
lower-priced markets like Florida and Arizona.

http://www.businessinsider.com/foreign-purchases-of-american-homes-surge-2014-7

PS: Which Canadian "Top 10" city is currently offering 20% gross rental yields at the moment?

 

[Thomas Beyer]

[quote user=KevinSolomon]

PS: Which Canadian "Top 10" city is currently offering 20% gross rental yields at the moment?
none.

And there are very few healthy US cities with those margins.

 

[KevinSolomon]

[quote user=ThomasBeyer][quote user=KevinSolomon]

PS: Which Canadian "Top 10" city is currently offering 20% gross rental yields at the moment?
none.

And there are very few healthy US cities with those margins.




I agree. Looking at the linked articles apparently the "few" include Baltimore, Philadelphia, Hernando and Pasco County (Tampa); which are all offering 20% gross rental yields.



PS: Which Canadian "Top 10" city is offering 15%-19.9% gross rental yields at the moment?

 

[REQRentals]

Seeing as Tampa was mentioned it is interesting to compare some economic data to our own largest market here in Toronto.



Both have an expanded market area: The Tampa Bay Area vs Greater Toronto Area



Population is hard to get up-to-date accurate info so I linked Wkikipedia for an easy reference: There are about 4.5M people in the Tampa vs over 5.5M in the GTA (6.0 M including Hamilton) . So Toronto is some 25% -35% bigger.



According to the U.S. Bureau of Labor the unemployment rate in Tampa was 6.2% in May . City of Toronto statistics says unemployment 8,2% as of May in the GTA. 8,8 in the City.



There was a lot of controversy about the net migration to Toronto in the press but the claim was 100,000 people coming here annually. Before the crash there were 92,000 people moving to the smaller Tampa Bay Area annually. In is more like 70,000 currently by the best estimates I have seen.



I would think the population numbers do not reflect reflect the large number of people who make their second homes in Tampa but remain on the census in their primary residences.



The average price of a home in Tampa in May was less than 200K in Tampa vs well over 500k in the GTA.



And while you will not get 20% net return you can legitimately pick up a house for 60K all in and rent in for 800+ in Tampa.



Whereas in Toronto for the same cash you can get a parking space and rent it for 150-175 .



Easier to get a loan on the parking space however. I suppose that is the point.