Florida Anyone?

Recently we’ve been talking about real estate outside BC.  Some people have mentioned buying in the States, as well, and expressed surprise that US property isn’t being marketed more strongly here. I was approached in late 2007 to market Phoenix property, but really haven’t seen much activity otherwise (I didn’t pursue the offer).

 I read an interesting take on the weekend written by Diane Francis.  She thinks its too early to buy in Florida, and assumes that her read is applicable elsewhere.  She’s not stupid, so take a look at her column and see if it spurs any discussion.

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19 Comments

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19 responses to “Florida Anyone?

  1. WoW

    I guess people are buying RE instead of new cars….

    How are the listings/sales looking?

    Rob – look forward to getting together, at the right time of course. I know I will be a happy customer, but when the market becomes a ‘buyers market’. Buy low – SELL HIGH.

    Sales of new cars, trucks, SUVs continue to decline
    Canwest News Service
    Published: Monday, January 14, 2008
    OTTAWA – Sales of new cars, trucks, vans and sport utility vehicles declined in November for the sixth time since May, Statistics Canada reported Monday.

    “There were fairly high sales within the second quarter of the year … if you had a lot of high sales early on in the year, then it’s possible people, having already purchased a new car were just purchasing less during the latter half of the year,” said Statistics Canada analyst Joseph Dunlavy.

    Its also possible people are buying more used vehicles, he said.

  2. WoW

    Sprint to lay off thousands: Report
    The wireless provider re-organizes under the leadership of new CEO Dan Hesse.

    Perhaps these folks can move to Vancouver and become part of the Olympic RE goldrush?

  3. jesse

    For British Columbians the problem with Florida is the distance. Read the comments of the article for some good points about the stuff to watch out for if you are thinking of buying. IMO you really need to know the area and the strata if you buy condos there or it’s a huge risk.

  4. Also, from what I understand, with Florida being in the hurricane belt, house insurance is not always easy to get, and when you get it, the expense is WAAAY more than here in BC.

  5. robchipman

    jesse:

    The idea here would be to buy in Arizona, I guess. However, I know of one person who was looking for sunshine and lifestyle and bought in Florida (after looking at Hawaii, Mexico and Costa Rica).

    greg:

    I think you’re right. Also non-residents pay higher property taxes. I’m also not sure if non-residents are allowed to carry concealed weapons 🙂

  6. Peter

    I am interested in looking at some RE in Florida. My friend just bought a 3000+ sq ft house with a covered underground pool for $500+k in Orlando. He said the price has fallen about $100k when he bought it but it’s still falling right now.

    I am also searching in Tampa. Some of my colleague live there. The price is pretty good compared to Vancouver. For the same amount of money, you can buy 2 detached houses with huge yard and swimming pool down south. Did I mention the properties are less than 10 yrs old?

  7. anon

    Lived (and owned) down there for several years. Here is what I can offer…

    -As a foreign national you are not eligible for homestead tax exemption (or protection). Look into it.
    -tough to get financing (especially lately) without paying a premium on your rate
    -home insurance difficult to acquire due to hurricanes
    -wood frame basically a disaster waiting to happen; buy concrete block
    -wood rot/insect damage big issues to contend with during inspection – get a reputible inspector
    -know your neighbourhood; value varies from street to street quite a bit

    Also, received a call from a friend last week whose wife is a RE agent in Orlando – 26000 listings to approx 2000 buyers. She is starving. “Bring your cash and the choice is yours. You’ll have months to decide what is the right buy” he said.

  8. theOC

    i bought a house in OC, california for 10% below list. 20 yr old. 1850sq ft, 4 bed, 3 bath. rents for 2800. i cashflow positive on this ($50) with 25% down, and including management ($208/mo). was assessed at 700k. last sale 600k a year ago.

    planning to buy more as market sinks more. but if it can flow positive, i think cali is a nobrainer. weather, jobs, economy (agriculture, entertainment, high tech, tourism, etc), etc.

    prices should hopefully start to appreciate by the time van corrects (if it ever does!). then sell, and buy vancouver property. take advantage of market timing differences.

  9. theOC

    forgot to mention. i paid 450k on the house.

  10. Al

    theOC, I can not see how this house can be cash flow positive.
    How much are
    your taxes,
    insurance,
    maintenance
    and what is your mortgage rate?

  11. theOC

    Al:
    mortgage is 2043/mo on $360k (30 yr fixed).
    management is 210/mo
    taxes and HOA are 500/mo.
    rent is 2800.

  12. theOC

    http://orangecounty.craigslist.org/search/apa?query=&minAsk=min&maxAsk=max&bedrooms=4
    will give you an idea of what a 4 br house rents at. you can search for the specific city you are investing in, etc.
    in my area, there were 24 houses for rent at the time.
    cheapest was 2600 (mine was better than that), next 2 cheapest were 2800, and next 5 cheapest were 3000. bottom 33% was $2600-3000. i wanted a fast rental so i priced at low end. (also my house wasn’t as nice as some of the 3k ones).

  13. Al

    theOC, why did you decide do not have any insurance on your house?

    And you have low maintenance, I assume that the house is in perfect condition?
    I’ve heard that foreigners are not allowed to do upgrades in their American investment houses….

  14. theOC

    i included insurance in the $500/mo fee. house is in good condition. i did not include maintenance reserve, so yes, that may cost money.

    not sure what you mean by not allowed to do upgrades, but i haven’t done anything major on the past house i owned. other than painting/replace floor, upgrades. (basically replacement of damaged materials). do you have a source on that? i’m interested in finding out more.

    i also set up a company in the US so that i don’t get withholding tax charged. also it protects me from being sued, etc.

    at the end of the day, i still feel this is a superior investment to anything in the GVRD. i have looked at houses here for $400k that rent for $1500-2000. (i.e. in the fraser valley). that would put me about $1000/mo in the red. i rather save the bleed and potential for capital loss and use that to fund more american purchases.

    there is only so cheap that OC can go. these same houses were 300k pre-bubble. so if it ever goes to that level, i will just buy more. (for the background, i cashed out (only my investment properties. still have my primary) 1 year ago in vancouver — maybe a bit too early, but money made is money made).

  15. Al

    theOC, I took this information from David Ingram’s “Ask an Expert” website http://www.askanexpert.ca.
    He is a tax expert and gives RE advises including investment properties in US.

    Wondering why are your property tax and insurance so cheap? Aren’t OC property taxes twice higher than Vancouver’s?

    Regarding OC, I agree with you that 2008 might be a good time to start buying. After 2 years of declining, prices already reached 2005 level.

    I am also thinking to buy investment property in California. If you can recommend any websites , I highly appreciate it (I mostly look at Zillow and MLS)

  16. theOC

    Al: Redfin : http://www.redfin.com .. very good!

    thanks for the tip. i’ll look it up.

    taxes are based on assessed value. i had my assessment adjusted based on my sale price. property manager and realtor facilitated this. you are correct. they are about double canada. about 1.2-1.5%. vs in canada its like 0.5%

    theres also home owner association fees. which can vary depending on the community. but for mine, it was $50/mo. for some condos its quite a lot! (but that will cover maintenance though).

  17. theOC

    Al: I looked at the site. I saw the following regarding property in the US. “You can buy a property and rent it out. However, you can NOT clean, repair or collect rent on the property. You must hire a legal US resident to do that for you if rented. If just a hideaway for yourself, you can buy a vacant lot and build it yourself (not with Canadian friends help though). But is you ever rent it or intend to rent it, you can not do ANY work on it period.”

    To me that makes sense as it is a serious offence to do any work in the US without proper visa, etc. (Hence I have hired a property manager). I have not yet found the part about upgrades, but I presume it is similar — i.e. must have it done by a US resident (you cannot do it yourself since rental property is a form of business).

  18. Al

    The OC, thanks for the link.

  19. beach

    thanks for posting this topic Rob and I’m sorry I missed this discussion. There definitely are some real issues with purchasing property in the US, do the same VISA issues apply to countries like Mexico, Costa Rica, Panama? Also, do those same issues apply to foreigners buying investment property in Canada?

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