breaking news
Healthy Food Factory Commissary Commercial Kitchen in Boca Raton, OUR KITCHENS ARE AVAILABLE 24/7/365 - Call (561) 394-7466 - Healthy Food Factory Commissary Commercial Kitchen in Boca Raton, OUR KITCHENS ARE AVAILABLE 24/7/365 - Call (561) 394-7466
Sign up for Newsletter
Email:
Florida_Panthers_Single_Game_Tickets_DIGITAL_8_2_18_CHILL_300x250.jpg
Century_21_Stuart_Goodwin.jpg
SFWW_236X150_WEB_AD_HAPPY_HERALD.jpg
Healthy_Food_Factory.jpg
South_Flo_Gutter_Services.jpg
Superios_Tint.png
DirectFreight.jpg
Open_house_Interior.jpg
A_H_Automotive.jpg
Dos_Amigos.jpg
Storm_Depot.jpg
Perfectly_Imperfect.jpg
Hemp_Factory.jpg
CBD_Docs.jpg
Bicycle_Spot.jpg
Allure_Massage.jpg
PG EXPRESS_1.jpg
Nomad_banner.jpg
Ace_Hardware.jpg
FinsFurs_Feathers.jpg
Ace_Hardware_rental.jpg
rss.jpg

 

 

 

 

 

 

 
. . . . . . .
Monday, April 4,2011

Ask Gabe

 

Email real estate questions to:
gpalotas@happyherald.com Call (561)394-7466 to “Ask Gabe” in person.

Q: I am a Canadian Citizen looking to invest in Florida. Could you give me some advice?

                                                                                                                   -Maurice and Nadine St Luis, Montreal, Quebec

 

 

A: Any Canadian investor considering putting money in the U.S. should have a basic understanding of some key differences of tax systems between buying real estate in Canada versus buying in the U.S.

Talk to an accountant that is experienced with American real estate investment as the countries differ considerably in terms of the taxation of investment properties. In the U.S. 1031 Exchanges allow the capital gains from the sale of an investment property to be deferred and rolled into a purchase of a similar type of property if it’s bought within 180 days. This can be done many times allowing capital gains to be deferred until the end asset is finally disposed of and not replaced; If capital gains are realized (property is sold and cash is received), the seller is taxed at 15% of the total net gain (as long as the property was owned for more than 1 year, if less than, the rate is much higher); Property taxes tend to be similar to those in Canada, however, if you are a Canadian and own a property in a Southern state like Florida or California, you may have higher “non-resident” property taxes than the locals; Similar to Canadian tax laws, you will not be taxed on your primary residence, however, in the U.S., you can write-off the interest charged on your home.

Compare this to Canada. Sell your investment property in Canada and you’ll pay capital gains tax on 50% of the net gain. Canada does not have the option of deferring the gain through an exchange. The “gain” or “loss” gets added to your income and your are taxed at the applicable rate (which could be much higher than the standard 15% rate in the U.S.); Similar to in the U.S., expenses associated with holding an investment property can be written off against your taxable income.

Lending differences between Canada and the U.S. The “credit crunch” or “subprime market meltdown” has had a dramatic impact on the U.S. lending environment, and has trickled over the border to Canada. Because of the economic crisis, lender guidelines and policies have changed dramatically in both countries. In the U.S., there were many mortgages given to just about any candidate. The phrase “ninja” loan was coined in the U.S. The acronym standing for “no income, no job, no assets”. Many individuals were given mortgages beyond their means. When the first large phase of ARM (adjustable rate mortgages) began to raise their rates, foreclosures began popping up all across the nation. Canadians have very different lending environments. There could be some great opportunities to be found as the Canadian dollar continues to sit around par with the greenback. But before you take the plunge, do your research. I will be glad to provide you my assistance in purchasing your second home in Florida. As a formal resident of Montreal and Ottawa I welcome you to Florida Paradise and you could leave your winter boots and fur coats behind. -Bienvenue Gabriel

Gabriel Palotas, Happy Herald Realty Manager, has more than 20 years of real estate experience with a proven record of productivity, quality and integrity. (Licensed Florida Real Estate Broker • National Auctioneers Association NAA • International Consortium of Real Estate • ICRE Transnational Referral Certification)

 

  • Currently 3.5/5 Stars.
  • 1
  • 2
  • 3
  • 4
  • 5
 
 
Close
Close
Close