The growing need to diversify portfolios

by CRE on 10 Oct 2018

Diversification is a fundamental aspect of any successful investment portfolio. Whether it is stocks, bonds or real estate, having too many assets allocated to one basket is a recipe for disaster.

When it comes to real estate investing, exploring new regions and geographies is a solid strategy for creating that much needed diversification. For Canadian investors, living next door to the world’s largest economy creates ample opportunity for investors looking to safeguard and expand their portfolios.

“There are many markets in the US that are very affordable, especially when compared to the major metropolitan areas in Canada,” says Alain Forget, a Director Business Development for RBC Bank. “From a portfolio diversification standpoint, there are a lot of opportunities for Canadian investors to diversify their asset base in the US, especially in states like Florida. Prices are competitive and investors can expect a good return on investment from a rental standpoint.”

It should, therefore, come as little surprise that more Canadians are looking to the US for real estate investment opportunities. The states of Florida, Arizona and California are proving to be particularly popular - and lucrative - for Canadian investors.

Data show that Canadians purchased $10.5 billion of US real estate between April 1st 2017 and March 31st 2018. Florida is the most popular state among Canadians, with buyers investing $4 billion in the state, a figure which represents 39% of all Canadian money spent on US real estate in the same period.

It is a region that presents a lucrative opportunity for ambitious investors. However, buying the property is often just the first step in a long line of potentially complex tasks and transactions.

“A lot of Canadians don’t know about the US real estate market or the differences in getting financing in the US compared with Canada and the benefits of getting a US mortgage,” Forget says. “When more people are aware of the resources and networks that are available to Canadians, I think we will see an increase in the number of Canadians who begin to explore opportunities south of the border.”

In order to educate Canadian investors on the best opportunities in the hottest US markets, CREW is teaming up with RBC Bank to host an exclusive webinar on October 17th at 2pm ET.

The webinar will cover the diversification, demographic trends and ROI expectations of the U.S. rental market and the financing options available for Canadians buying in the U.S. The session will also cover the differences of securing a mortgage in the U.S. versus Canada and discuss how getting a U.S. mortgage helps mitigate the impact of the currency exchange between CAD and USD.

The webinar will also feature a Q&A with Alain Forget and Garry Walmsley, Senior Global Real Estate Advisor at The Orlando Agency,

You can sign up for free right here

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