What Canadians buying in Arizona should know

Important considerations when buying in Arizona

As home prices have declined in Arizona, the goal of many Canadian citizens of owning a home in the U.S.  has become a reality.  Instead of shoveling snow and battling freezing temperatures, Canadian second home owners can be dealing with other issues such as which golf course should I play today, or how early do I want to get up to go hiking or jogging, and where should we go for dinner.  I’ve also noticed that many Canadian homeowners who live on a lake in Canada have a desire to duplicate that scenic landscape and have inquired about lakefront homes in Phoenix.  When a buyer from Canada decides to pursue owning property in Arizona, there are some considerations they should be aware of.

Getting a loan in the U.S. as a Canadian citizen

A frequent question is, “Can a Canadian get a loan through a U.S. bank?”  It has been somewhat of a moving target; however, as of this writing there are companies that do offer loans to Canadians through a U.S. bank.  There are some conditions.  For example, one lender requires that the down payment must be at least 30% and the borrower must have 6 months reserve in a U.S. bank.  And the maximum loan amount is $417,000 and requires a 700 FICO score.  It’s best to talk to a loan officer that is familiar with these loan options.   If you’d like contact information on banks that do provide loans to Canadian citizens, please call me directly.

Earnest Money, Escrow and Signing

Earnest money which is used to open escrow once the offer has been accepted must be in U.S. funds.  Another difference is that in Arizona attorneys are typically not involved in the transaction.   Title/escrow companies take care of the title insurance and make sure the contract is executed as written.  This makes for a much more streamlined escrow and smooth closing process.  In fact, the buyer(s) do not need to be present at closing, and the necessary paperwork can be signed in Canada and sent via priority mail to the title/escrow company prior to closing.  Possession takes place once the transaction has recorded with the county recorder.

When a Canadian buyer is ready to place an offer on a house and no financing will be required since it will be a cash transaction, the proof of funds (typically a bank statement) may be required to be in U.S. funds.

Inspection Period

The 10 day inspection period begins once the offer has been accepted. During this time, it is the buyer’s opportunity and responsibility to inspection the property and the surrounding area in detail. The Arizona Department of Real Estate has provided the Buyer Advisory to assist buyers in their due diligence.

Most Arizona properties are platted and do not require a survey.   This is different from Canada where a surveyor’s certificate is required.

FIRPTA – The Foreign Investment in Real Property Tax Act

 The Foreign Investment in Real Property Tax Act (FIRPTA) kicks in when the seller is a foreign person. Typcially not an issue when buying a property, it will come into play when selling.  One of the exemptions to FIRPTA is that the house sells for  less than $300,000.   It is in place to insure that foreign persons are not purchasing property only to sell it later at a profit without paying taxes.  A foreign person is a nonresident alien individual; a foreign corporation not treated as a domestic corporation; or a foreign partnership, trust or estate. A resident alien is not considered a foreign person under FIRPTA. IRS Publication 515 can provide more detailed information.

The Phoenix area provides a great second home get-away for Canadians looking for a repreive from the harsh winters.   For detailed information regarding Arizona homes for sale, contact me at your convenience. Or receive property listings via e-mail that fit your winter vacation home criteria.

Here’s some feedback from one of my favorite Canadian clients  last year who live in Alberta and their feedback on the process:

“Just thought that we’d drop you a quick note to let you know how much we enjoyed working with you on the recent purchase of our home in  Phoenix.  No surveyor’s certificate and no legal fees made the process a lot less stressful than buying our home in Alberta. 
 
We, seriously, don’t know how we would have managed without you.  Since the inspections, utilities hook-ups, and all the paperwork were initiated by you, all we had to do was – literally – get the key and move in.
 
So “THANK YOU” and be assured than we are passing your information on to anyone we meet who talks about investing in property in Arizona.
 
All the best,
Jim & Annette
Millet,  Alberta  ”

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$860,000 :: 425 E COCONINO Place, Chandler AZ, 85249

Property Photo

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4 beds, 3 baths
Home size: 3,482 sq ft
Lot Size: 14,375 sq ft
Added: 08/25/20, Last Updated: 09/24/20
Property Type: Single Family
MLS Number: 6122388
Community: PINELAKE ESTATES
Tract: PINELAKE ESTATES
The price of this listing was last reduced on 9/24/2020 by 1%
Status: Active


LARGE & BEAUTIFUL WATERFRONT HOME ON A HUGE LOT IN CHANDLERS PRESTIGIOUS PINELAKE ESTATES!This is a 4 bedroom, 3 bath home with a SEPARATE OFFICE and high ceilings from 9 feet to 12 FEET! The CUL-DE-SAC LOT IS almost 15,000 sq ft!Large 3 car garage with lots of built in cabinets and a large upper deck off the master suite to enjoy your lake view and evening sunsets. A property like this doesn't come on the market very often. Make sure your clients are aware of this beauty.

Listed with HomeSmart


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$315,000 :: 3800 S CANTABRIA Circle #1098, Chandler AZ, 85248

Property Photo

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2 beds, 2 baths
Home size: 1,564 sq ft
Lot Size: 3,485 sq ft
Added: 09/30/20, Last Updated: 09/30/20
Property Type: Condo/Townhouse/Co-Op
MLS Number: 6139433
Community: CANTABRIA SHORES
Tract: CANTABRIA SHORES
Status: Active


Absolutely gorgeous, lock and leave Ocotillo condo now available for immediate sale! This beautiful condo has been completely remodeled over the last couple of years. Newer cabinets, flooring, counters, appliances, bathrooms, and a new roof! The kitchen features custom cabinets, granite counters, reverse osmosis, newer appliances. Both bathrooms feature updated cabinets, new countertops, new showers, and new flooring. 2nd story balcony overlooks large green space and community pool. Two-car garage with storage cabinets. Gated community includes heated pool/spa. Walk to 27-hole Ocotillo golf course and fine dining. Close to Intel, Northrop Grumman, Price Road Corridor, 101, 202, I-10 freeways. This condo is move-in ready! Can be sold furnished.

Listed with Coldwell Banker Realty


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


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