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FAQ-Canadians

If you have a question, please use the form below.

Question:

I am a Canadian resident interested in buying a second home in Arizona. How do I get started?

Answer:

The first question you'll need to answer is, are you paying cash or financing your purchase?

Cash- Cash is King? All things being equal, a Seller will almost always take the cash offer. That being said I am not seeing the deep cash discounts that I saw a year or so ago. With a cash transaction expect to close (it's yours) within 2-4 weeks.

Financing-This is a little harder. A lot of the US banks are currently not lending to non-US citizens, but we can send you a list of four banks right now that are anxious for Canadian clients. We  can refer you to banks that will do loans for investment homes and second homes.

Question:

What are the differences between buying a home in Arizona vs buying in Canada?

Answer:

There are more similarities than differences. Generally speaking it will take you less time and it will cost you less money to purchase a property in Arizona. You won't need the services of an attorney in Arizona as all the paperwork is handled by a licensed escrow officer. You can also complete the transaction from Canada as all the paperwork can be emailed or sent by UPS or Fedex.

 

Question:

What is the time frame to take ownership of a property once we have located one? When can we move into the property?

Answer:

On a cash transaction the time frame is normally 2-4 weeks. If you are getting a mortgage on the property, it generally will take 4-6 weeks, but could take less time.

 

Question:

Are there any tax breaks or credits for a Canadian buying a home in Arizona?

Answer:

I am not an accountant nor a tax expert, but I am unaware of any tax breaks or credits for Canadians purchasing property in Arizona. Please check with your tax expert to have any specific question answered on this subject. If you're a Canadian business buying a property this might change the equation.

 

Question:

I'd rather not pay cash for my Arizona vacation home, is it possible to finance the purchase?

Answer:

 

Banks will loan money to Canadians buying either an investment home or a second home in Arizona. Whether you will qualify for a loan will depeend on your credit and income. Rates may vary based on this information.  We can currently refer you to at least four banks who are anxious for Canadian clients. Email or call us for a list of lenders.

 

Question:

Can I rent out my property once purchased?

Answer:

Generally yes, but please check with your real estate agent and get a copy of the property's Covents, Conditions & Restrictions often called CC & Rs to confirm. It's rare that you will not be able to rent your property out, but please confirm this fact during your due dilengence period.  A few communities will not allow rentals at all and many will not allow short term vacation rentals.

 

Question:

Do I need to use a property management company to rent out my property?

Answer:

No, but you do need a local person to act as your "Statutory Agent" in the event of a problem. Having an honest and professional licensed property management company such as Red Hawk Realty is however a great idea. You'll need someone to handle the maintenance issues, collect the rent, find a screened and qualified tenant and to keep you moving in the right direction.

 

Question:

How much do property management companies charge?

Answer:

It varies by company. Generally they charge 8%-12% of the gross monthly rent collected. So if your rental rate was $1000.00  the fee would range between $80.00-$120.00 per month. Most reliable property management companies will only charge you once the rent is collected. Some however, will charge you whether the property is vacant or rented. Personally, I think a fee should only be paid when earned.  

 

Question:

What will a property management company do for me?

Answer:

Click here.

 

Question:

Who collects and pays the local rental tax?

 

Answer:

The rental tax, a tax required by the local municipality, is generally 1.5%-2.5% of the monthly rent and is paid by the tenant with his/her monthly rent payment. A good property management company will collect the tax, prepare the required report, and submit it to the municipality. All at no additional charge.

 

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