The combination of three factors prompted twice as many Canadians to purchase a residence south of the border in the 12 months ending May 2008, when compared to the previous 12 months: (1) a stronger Canadian dollar versus the U.S. currency; (2) a drop in U.S. house prices; and (3) last winter’s record snowfall.

The increase occurred despite a sharp -33% drop in the total number of foreigners who purchased a U.S. residence, according to a report by the National Association of Realtors entitled 2008 Profile of International Home Buying Activity.

Seeking sun, sand and sea, Canadians bought an estimated 7,200 homes in Florida between June 2007 and May 2008, more than double the 3,500 homes they purchased in the previous 12 months.

After Florida, Arizona was the next favourite home-buying locale for Canadians. In 2007-2008, Canadians acquired an estimated 752 homes in the Grand Canyon State, almost twice the number they purchased in 2006-2007.

Seeking to minimize the expense and time associated with owning a detached single-family dwelling, nearly 50% of Canadians bought condominiums, while 75% of other foreign buyers opted for a detached single-family home.

With respect to expenditures, although the $297,000 median price paid by foreign home purchasers in 2007-2008 was slightly less than the $299,500 price paid a year earlier, it was still well above the national median sales price of $217,900 for the period from June 2007 to May 2008.

Looking forward, the Canadian appetite for U.S. residences will probably cool over the near term, for three reasons: (1) a weaker Canadian dollar versus the greenback, (2) general slowing of income growth in Canada and (3) firmer U.S. house prices.

However, over the longer term, an increasing number of retiring baby-boomers seeking relief from the winter chill will ensure that Canadians continue to be major foreign buyers of U.S. residential property for the foreseeable future.

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