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Investing in the desert
Published Friday, September 2, 2011 6:17AM MDT
Many Albertans are looking to invest their money in American real estate, particularly in Arizona.
Not only are Canadians buying vacation homes, some are also buying and investing in businesses.
The Las Sendas golf club in Mesa, Arizona is one of the top courses in the state, and it's owned by two brothers from Chestermere.
"When we made the acquisition we had mainly Canadians involved," says Lloyd McBean. "However we had local community people that wanted to become involved and they came in along with us."
Lloyd and Wayne McBean have owned the Lakeside golf course in Chestermere for the past 21 years. Two years ago, the brothers decided to invest in Arizona due to the region's consistent weather, their familiarity with the area and the economy of 2009.
"Many of the golf courses down there, in this challenging time, do have a lot of debt," says Lloyd McBean. "We are 100 per cent debt free. Not only did we purchase the golf course but we immediately spent another $4 million on improvements to the golf course."
Arizona is an investment trend that continues to grow.
Not only are Canadians investing in businesses and homes in Arizona, the number of Canadians visiting the southwest state is at a record high. The Canadian influx is visible to locals says Michelle Streeter of the Mesa Convention & Visitors Bureau.
"There's a local saying, there's a Canadian on every corner," laughs Streeter. "It's really great because they have come down and invested in our community. They've brought a fun attitude toward vacationing in Arizona."
In 2010, over 565,000 Canadians visited Arizona.
The lion's share of Canadian visitors are from Alberta (36%), followed by Ontario (26%) and B.C. (19%).
But visiting and investing are two different things.
The director of The Investors Group, Shafik Hirani, says there are perks and pitfalls to investing in the U.S.
"The bottom line is you have to be calculated in what you buy and where you buy," says Hirani. "You have to look at all the options that are available to you."
Hirani says a common mistake Albertans make is failing to understand there are different tax rules for buying vacation properties as opposed to rental properties.
He recommends using an accounting agent familiar with U.S. tax laws.
Hirani recommends you do your homework before investing your money.
The following websites have additional information on Arizona: