The National Association of Home Builders announced on May 19^th, 2009 that the market for the newly built, single-family homes in the USA improved for a second consecutive month in May to the highest level since September of 2008. The National Association of Home Builders/Wells Fargo Housing Market Index (HMI) rose two points to 16 this month.

NABH Chairman, Joe Robson noted several factors contributing to the rise in confidence level in the US real estate market. Favorable mortgage rates, $8000 tax credit for first time home buyers, affordable prices and the multitude of home choices are appealing to potential home buyers and investors to make a move.

Many real estate professionals reported not only are they seeing local homebuyers with solid financials showing interest in the market.  They are also reporting a slow rise in foreign interest in US real estate. Although these foreign real estate investors do not qualify for tax incentives, however the potential return on attractively priced quality real estate properties is enough to them focused and interested in US properties.

Ever dreamed of owning a vacation home in Florida? The Globe and Mail interviews Harold Green of Central Showplace about he opportunities available for owning a vacation home in Florida and other US sunbelt homes. 
 

“Many people who go there one or two weeks a year think they know the market,” Mr. Green says. “Bottom line, they do not. Owning and caring for a second home in Florida is much more complicated than owning a condo in Toronto.

The best investment in Florida is not necessarily the cheapest or the most discounted. 

View the full article at Globe and Mail

Americans may not be buying homes, but international buyers are finding the U.S. housing market an enticing place to invest their money.

International buyers are driven to the US real estate market by bargains and currency rate advantages. Additionally, as 30 percent of these buyers tend to buy with cash, the mortgage credit crunch is not a worry for them.

Florida, California, Arizona, and Texas are the top destinations for international real estate buyers according to a National Association of Realtors (NAR) survey.

NAR Chief Economist Lawrence Yun says, “the real estate sold to foreign buyers in Texas tends to be modest-priced homes … More than 60 percent of the homes purchased … are priced under $200,000.”

Travel and Tourism businesses are gearing up to provide the best services for NEXTgen Travelers, better known as “Tech-savvy” travelers. PhoCusWright, a travel industry research authority, conducted a recent survey of 2,559 adults who are active users of the latest computer, entertainment or consumer technology.

According to the survey, these “next generation” travelers are highly educated, affluent, and are equally likely to be Baby Boomers (43 to 61 years of age) as Echo Boomers (18 to 28 years of age), thereby debunking the belief that the usage of new technology is concentrated strictly among younger travelers.

The NEXTgen travelers are defined more by their attitudes towards technology than their demographics. It is vitally important that industry observers fully understand the lifestyles, travel habits and travel intentions of this emerging group.

Survey respondents revealed their preferences for using the Internet when planning travel:

• 71 percent use the Internet to search for travel information
• 41 percent have taken a virtual tour of a destination
• 38 percent have built a trip itinerary online
• 58 percent cite the “ability to check the best fares/rates” as the most important feature in a travel website.
• 37 percent say that personal comments on social networking or travel advisory sites influence their travel decisions
• 33 percent have posted their own travel review online

The survey indicates a need for a fresh approach to media strategies that will reach this growing travel audience. Is your business ready for the “NEXTgen” travelers?

Elizabeth Barrow 

Crystal Coast Tourism Authority 

The comparatively strong Canadian economy continues to drive Canadians to look for real estate deals in the US. National Association of Realtor (NAR) Studies show that almost double the number of Canadians are buying US real estate compared to 2007 and that number is likely to keep pace or grow as Canada will lead the other G7 countries in economic growth in 2009 according to a new International Monetary Fund (IMF) study.

While Canada is clearly not immune from the ongoing global financial crisis, the country is expected to see economic growth in the range of 1.2 percent in 2009 according to IMF. While that is less than half of what Canada experienced in 2007 it is expected to be the best performance among Japan, the United States, Italy, France, Germany and the United Kingdom.

The IMF anticipates the U.S. economy will continue to be slow next year, posting an almost zero growth rate of 0.1 percent for 2009.

Releasing the full findings from its 2008 National Association of Realtors (NAR) Profile of International Home Buying Activity, Canadian in particular are taking advantage of the current soft U.S. real estate market by buying vacation property or second homes. Percentage of Canadian buyers doubled from last year, from 11 percent to 23.5 percent - now the biggest foreign buyer market in the U.S.

The NAR report also finds that “64.4% of Canada buyers plan to use their U.S. homes for vacation purposes. On average, foreign purchasers plan to stay in their U.S. property 2.6 months of the year. A third intend to use the U.S. home a total of 3 to 6 months”.  Condominiums were popular among foreign buyers from Canada: nearly half of all properties purchased by Canadian buyers were condominium/apartments.

Foreign exchange rates have helped keep US homes more affordable, the value of the U.S. dollar as compared to foreign - especially Canadian and European currencies has dropped over the last several years. The effect net when combined with lower U.S. home prices, means that the true cost for a U.S. property is actually less in foreign monetary terms than in previous years.

Although it is still seen as a healthy number of international buyers entering the market to supplement the declining domestic sector, the faltering markets in the UK and Europe have had an impact on the amount buying in the US this year – predicted to be far higher then current figures would suggest.

Of the 4,000 US-based agents surveyed between May 2007 – May 2008, some 26 percent served international clients in the past year and nearly half of those clients ended up purchasing a home. The primary reasons some clients did not eventually buy a house were home price concerns, immigration laws, and property taxes. “If visa regulations that favor longer stays for overseas buyers such as retirees from abroad were in place, these sales levels would be even higher,” said Tony Macaluso, 2008 chair of NAR’s international business group.

“Many international buyers recognize that real estate is an excellent investment and are drawn today by abundant inventory, low interest rates and a softer dollar. These conditions allow them to own their own a piece of the American dream,” said NAR President Richard Gaylord.

Foreign buying trends in USA
May 2007 – May 2008: Source NAR
- 150,000 – 190,000 properties sold to international buyers
- Florida, California Texas. Arizona, New York, Washington, Nevada – most popular locations
- 14% of foreign bought property cost over $750,000
- Average foreign purchase cost $297,000
- 40% of buyers paid in cash
- Canada, UK, Mexico, China, India and Germany most active buyer markets
- Percentage of Canadian buyers doubled from last year, from 11% to 23.5% - now the biggest foreign buyer market in the US.
Source: NAR

The owners of two new ocean front condominiums, in Galveston, Texas, can enjoy their beachfront homes knowing, like most new condominiums built on the US coast, they were desgined with hurricanes and great storms in mind.

Located just 300 feet from the Gulf of Mexico, the twin towers of the Palisade Palms withstood Ike’s gale-force winds and massive storm surge with minimal impact. “With the exception of some damage to our tennis court and a few windows that leaked, the buildings came through the storm virtually unscathed,” says Richard Anderson, vice-president of development operations for Falcon Group, the project developer for the condominiums.

Designed by Toronto architectural firm Kirkor, the Palisade Palms was built specifically to withstand the impact of a major hurricane. “Before we started construction, we had a scale model of the towers tested in a special wind-tunnel laboratory at the University of Western Ontario,” explains Anderson.

As a result of the lab’s expertise in assessing real-life building design issues based on predicting wind loads, the project’s structural engineer designed the main floor units and building lobby to sit 33 feet above sea level, nearly twice the height of the 17-foot coastal seawall. Established in 1965, the world-renowned lab, in London, Ontario, has been involved in the evaluation of many famous structures, including the Toronto’s CN Tower and the Sears Tower in Chicago.

Many savvy international real estate investors are aware of the soft US real estate market right now. Almost every real estate property website and newsletter is filled with hundreds and thousands of bank foreclosure listings.  Many of these listings are in top vacation states or in highly desirable parts of the country. At these deeply discounted prices, one may even consider purchasing one of these properties as a second home or as a vacation rental home for long term investment purposes. But with thousands of websites advertising bank foreclosure properties, beware of the many new foreclosure scams.

Many of these scams prey on suffering homeowners with currently devalued properties. But as a potential investor, the “Bailout” scam is one to look out for.  In this scam, the “Rescuer” gets the desperate home owners to surrender their title to the house, convincing them that they are making a deal to become a renter and will buy back the home over the next few years. Homeowners, are told that someone with better credit can secure new financing to prevent the loss of the property, are cajoled into surrendering the title.

The “Rescuer” then lists the property on the market and sells it to unsuspecting property investors. By this time, a buy back becomes impossible for the original homeowner for they have permanently lost possession, and the “rescuers” leave with all or most of the home’s equity. The property investor now holds title to the dream rental income property, but is stuck with an unwanted tenant that has little chance of fulfilling monthly rental fees and potential litigation costs.

There is no one better to safeguard your future investment than yourself. Doing your research and working with reputable advisors is the best defense against fraudsters.

From state-of-the-art fitness centres to private trolleys to the beach, new condo developments have it all

Canadians interested in buying a second home in the U.S. should certainly consider taking advantage of today’s market, says Sherry Cooper, chief economist for BMO Capital Markets.

Although the Canadian dollar has fallen off a bit from its high of $1.10 (U.S.) back in November 2007, it’s still strong at around $0.93 [as of Sept. 9, 2008]. Combine that with the drop in U.S. house prices and you get a good market for homebuyers, notes Cooper, who recently bought her own vacation property in Sarasota, Fla. 

“But you can’t time the markets exactly,” she warns. “Home prices in the U.S. may continue to fall until mid-to-late 2009.” 

Cooper cautions against buying on impulse and advises taking the time to do some careful research. In her case, the Sarasota area was familiar ground because her mother had wintered there for many years. The bottom line: No matter how good a bargain, it will only be a great buy if it ends up being what you truly wanted.

-The Toronto Star (September 27, 2008)