Canadian snowbirds in sell mode because of lagging loonie
The value of the Canadian dollar jumped slightly on Thursday, but it’s just a blip on the radar in what’s been an otherwise dismal performance ever since the price of oil collapsed.
Now, some Canadians with winter homes south of the border are debating whether to cash in and sell while the U.S. dollar soars.
Maureen Porter is a realtor in Arizona who has a niche client-base of primarily Canadian homeowners. She says the uptick in homeowners deciding to sell is extremely apparent.
“We’ve been steady busy and then-I’d say for the last three months-things have really cooled,” Porter said. “But in the last two weeks it’s picked up-crazy busy now.”
She says Canadian homeowners in the Phoenix area are trying to cash in on all the equity they’ve earned in the past few years.
“Specifically investment clients: if they were buying in that period from 2008 to 2011, there’s about a 35 per cent to 40 per cent upward gain from when they purchased, so there’s not going to be a lot of growth in the equity at this point,” she said. “So really, the stars are aligning again. They’ve gained really good equity in their property and now they can take that money and get an extra bump on the exchange rate back home in Canada.”
Clare Seal is from Regina, Sask. but spends much of his year in Arizona, where he owns both a vacation home and a rental-income property. He says the current economic conditions have forced him to consider cashing in, at least on his rental property.
“We paid USD$150,000 for it in ’09 – it says now it’s worth USD$230,000. So $230 U.S. translates to – I don’t know – three and a quarter, maybe, Canadian? That’s kind of tempting,” he said.
According to Porter, Phoenix is also a popular destination home for American snowbirds because of its warm climate and smorgasboard of tourist attractions. She says the fact many American families are finally recovering from the 2008 financial system collapse, means Canadians looking to sell have no shortage of potential buyers.
“The people that lost their homes, in the period that my Canadian clients were purchasing these homes for really good discounted prices… now they have gone through that cycle of a four-year, five-year period, where they can get qualified for mortgages again,” she said. “So they were homeowners at one point, lost their homes in the downturn, became renters, and now that their credit is getting repaired, they’re the ones that are purchasing the properties.”
“Real estate you go with the turns of the cycle. I’ve learned that since I’ve started.”
Porter points out that not all of her Canadian clients are looking to sell; some are happy to get the extra rental income because of the strong American dollar.
“I think the thing is, if you’re looking to make money, like our neighours for example, their feeling is… if they don’t get what they’re asking, which is top dollar, then they’re not going to sell,” Seal said.
Porter told Global News she put a house on the market at 7 a.m. Wednesday and received calls from other agents on it just two hours later.
With files from Global’s Kent Morrison
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