I'm hearing that it's still quite popular for some Canadians to get investment properties by buying foreclosed condos in Las Vegas (for under $50k), Arizona (for under $150k) and some say Miami FL.
What do you think and do you know anyone on this side of the border that specializes in this sort of investment?
I own a property in Florida, on the Gulf of Mexico, it's a great, great place and I love it. In fact I'm going there for 3 weeks starting next week. Interesting enough Obama is taking a 3 day holiday to the same area this upcoming week-end. I was using a property management company to book our condo-hotel, but over the last 3 months I've joined Vacation Rentals By Owners (VRBO) and that's been great!
My advice is to look at it from 3-4 perspectives.
1. Replacement cost, if they can't build it for what you're buying it for, that's good. The bigger the difference between the price it costs to construct and what you're buying it
for the better.
2. Exclusivity - If you just buy a house on block "x" in city "w" and there's no constraint or special appeal to it, it may never rebound. You need to buy on the ocean, on a lake,
or golf course and ensure it has lots of ammenities. Essentially the idea is to buy something baby boomers are going to want, cause they're still getting older by the day.
3. Cash flow - if you can get positive cash flow with a modest downpayment that's obviously good.
4. Another big issue is the currency issue, all things considered buying at or near par is good.
The trick is to try and get all for of these factors working in your favour.
In terms of companies, I know of a company that's main focus is to buy distressed properties in Arizona etc. rent them out with minimal down payment, ensure it has a positive cash flow and they have an exit strategy well to sell each property based on a number of factors. They have access to both Canadian and US expertise in legal, accounting and real estate advice.
If you buy on your own, you'll also have to deal with filing US tax returns, and depending on the state you may have to file a US and a state return and you may be responsible for collecting sales tax in some circumstances.
