It's time to cash in for many Canadians who bought property from 2008 to 2011 in the United States, says Diane Olson, an Arizona real estate agent and former Winnipegger.
"My clients, when they call me, they're ready to sell. It's just too good of an opportunity to pass up," she said.
- Average Canadian house price up another 12% to $454,342
- Real estate woes: The secret lives of house-poor Canadians
- 'Frenetic' price growth in real estate market to slow in 2016: Royal LePage
Substantial foreign exchange gains and appreciation in home value over the last five years have created a "perfect storm" for Canadian homeowners in the United States, she said.
anywhere from $275,000 to $350,000," said Olson. Add to that the loonie trading for about 70 cents U.S. and Canadians are making an additional $42,000 on each $100,000 in U.S. property sold, she said.
While exchange rates and appreciation offer a substantial incentive to Canadians, Olson said, the cost of living in places like Arizona is also pushing Canadians to pick up and leave.
"Airfares have gone up.… Golf, for example, everybody used to get great deals. Golf now has gone up significantly," said Olson.
Taxes take bite out of home sales
While there's revenue to be made for Canadians selling their American sun vacation homes, they are still subject to U.S. taxes.
"If you're making money, the government definitely wants to capitalize on that," said Olson.
Canadian sellers have to pay federal, state and capital gains taxes on property sold in the U.S. under their name, said Olson. They also may have to pay some additional Canadian taxes, if U.S. tax rates are lower than in Canada.
She recommends Canadian sellers consult an accountant with expertise in cross-border transactions.