O Canada – Part Deux by Roy E. Grimm, PhD
Sedona Monthly Article Dec. 2012
Their national anthem has Canadians sing, “O Canada… we stand on guard for thee…” With early U.S. history marked by a number of abortive American invasions of our neighbor to the north, guess who Canadians have been standing on guard against all this time?
Now the tables have been turned and it is we who are being invaded. Yea! That’s a wonderful thing for all concerned. Many Canadians have found perfect and affordable vacation homes in Sedona – a boon to the Sedona real estate market. And, they’re marvelous folks. Never met a Canuck I didn’t like.
About the same time that U.S. real estate markets started to tank in 2006, the value of the Canadian dollar began to gain strength against the U.S. dollar. Back in the 1990’s and early 2000’s the Loonie (named for the loon depicted on the Canadian one dollar coin) was deeply discounted versus our Greenback. In December, 2000, for example, it took 1.52 Canadian dollars to equal one U.S. dollar. That was terrific if you were an American on holiday in Banff. Not so great if you were a Calgarian who wanted to buy a home in Sedona.
But, with the U.S. dollar losing value against the Loonie, Canadians began to get a major discount on American real estate. Combine that with prices dropping precipitously in the latter half of the decade and you get serious bargains even before you start negotiating. Consequently, Canadians have been quietly scooping up property – from small condos to luxury homes – here for several years.
Lately, though, we’re seeing an upsurge of Canadian buyers – double the usual number in my experience. Something cookin’ up north? Their real estate market, it seems. By and large, Canada was spared our bubble phenomenon. As they watched ours burst, their market kept humming along. Now, a number of observers perceive a bubble in the making there. Canny folk that they are, many Canadians are cashing out and re-investing in the U.S.
Although we’ve had more than a few clients from Ontario, most heading to Arizona hail from British Columbia and especially Alberta. The vast majority of those seem to focus on the Phoenix area. Makes sense if you’re only coming for January and February and don’t mind the traffic, crime, and pollution. The more discerning prefer the dramatic scenery, small town intimacy, and mild four-season climate of Sedona. Our fall and spring, after all, are more like summer in Alberta, and our winter, spring-like to a denizen of Calgary.
The Canadians I’ve met are gracious people that I am delighted to have as friends and neighbors. They’re sharp investors looking for genuine value. Happily for us all, they’re finding it in Sedona.