Frequently asked questions about purchasing real estate in Arizona.
If you’re thinking about buying a vacation home or investment property here in Arizona, then you have come to the right place. From time to time we’ve been asked from our Canadian clients many different questions about the buying and selling of real estate here in Scottsdale, Arizona. So in order to better serve our friends from across the border, we thought we would provide some informational facts that would help in the decision making process.
Well to begin with not everything you may have heard about our real estate market is true. Yes, we have had a significant down turn in our market over the last few years and have seen record levels of foreclosed homes. Have we hit bottom? Well, depending upon whom you talk with we may have already started to rebound.
Are there still deals out there and can we find a home below market value? Yes you can and we’ve assisted many Canadian’s like yourself find outstanding deals here in Scottsdale and the surrounding communities.
In order to better serve you, here are some facts you need to know when purchasing property in Arizona.
Where do we start?
First off, we recommend finding an experienced real estate agent that you can trust and rely upon for valuable information and “I” want to apply for that job! Call me today at 1-866-620-2164 and I will start immediately. I will guide you through the process of buying real estate here in Arizona. If you choose to purchase a vacation home or investment property, I have the resources to assist you from start to finish. I can recommend lenders, inspectors, title companies, property management services and contractors to you.
Are there Buyer’s Agents for Canadians purchasing Arizona real etate?
Are there any restrictions for Canadian buyers purchasing a home in Arizona?
There are no restrictions for foreign nationals buying property here in Arizona that we are aware of.
If I don’t want to pay cash can I obtain financing to buy in Arizona?
Yes, we have many lenders that we work with that can obtain a suitable mortgage when purchasing a home in Arizona. If you want to obtain a mortgage in Arizona you will need the following information before a lender can assist you.
- Copies of passport and visa.
- Last two pay stubs.
- Last two bank statements.
- Last two years tax returns, if self employed a letter from an accountant stating how many years you’ve been in business, and business tax returns.
- Verification of two years of employment history.
- International credit report-lender will order.
- Set-up an American bank account to transfer funds.
- Down payment around 25% to 40% of total purchase price of home.
What costs are involved in purchasing a property in Arizona?
Most of the cost involved in purchasing a property will be fees that you pay to the lender, which is primarily done through a title company. Arizona is a title bearing state and we do not use Attorney’s to process our real estate purchase and sale contracts. This in itself will save you some money.
You will also most likely pay for a home inspection, termite inspection, an appraisal, the escrow (title) fees, title insurance, recording fees, property taxes and homeowner’s insurance. A good rule of thumb is to figure your closing costs will be approximately 3% of the purchase price. This cost will be considerably less if you are paying cash. It will be around 1% of the purchase price for cash buyers.
Arizona does not have a real estate transfer tax and the Sellers pay for all real estate commissions.
What about property taxes in Arizona?
Good question. You will be pleased to know how low our property taxes are. Each city and county will vary slightly, but taxes are usually around .8 to 1.5% of the assessed value of the property. Taxes are re-evaluated every 24 months in Maricopa County.
Are Canadian buyers subject to capital gains tax when their Arizona property is sold?
The foreign Investment in Real Property Tax Act (FIRPTA) imposes a U.S. tax on income and gains from real estate owned by “non-resident aliens” at the same graduated rates applicable to U.S. persons. It is recommended you consult with an accountant or lawyer for more details.
Can I lease my property out when not in use?
Yes. Typically, our rentals are done either furnished for a short-term basis (1 to 4 months) or unfurnished (6 to 12 months) for a long-term basis. If your property is located within a Home Owner Association Community, you will need to review your Covenants, Conditions and Restrictions (CC&R’s) to determine the length of time you want to lease your property and assess any restrictions.
We have a very large seasonal rental pool here and have clients from around the world who visit sunny Arizona during the fall and winter seasons to enjoy our climate, golf, entertainment and recreational activities.
What is the best way to decide where to buy?
I suggest that you first consider what activities interest you, such as golfing, fine dining, shopping, hiking, tennis, arts or other entertainment venues. Then, concentrate your search near where those activities are located. For example, if golf is of the first priority, then North Scottsdale, Chandler or Gold Canyon maybe your first choice. If art venues are your preference, then Old Town Scottsdale, Central Phoenix or Carefree maybe preferred. We can assist you in locating the right residence for your tastes and budget.
Are HOA budgets and reserves readily available for my review?
Our real estate contracts are buyer friendly, meaning that you have an inspection period to not only review the condition of the property, but the HOA information before you move forward with the purchase of the home. This protects you from buying into a community blindly and gives you a better state of mind that moving forward is a safe and secure investment.
Hopefully the above information has helped with some of the confusion you may have heard in the past about buying a home in Arizona.
Please call us today at 1-866-620-2164 or 602-620-2164 and we would be happy to answer any of your questions and would be honored to assist you with your home purchase here in sunny Arizona. Don’t want to call? email me at firstname.lastname@example.org