Amid rising political unrest in the U.S. and persistent tensions between the two countries, more Canadians are choosing to ‘stay local’ and limit trips across the border. In addition, many who own U.S. residential properties are reconsidering their long-term strategies—with some already making the decision to sell.
According to a recent Royal LePage survey, conducted by Burson, more than half (54%) of Canadians who currently own residential property in the U.S. say they are planning to sell within the next year, among whom a majority (62%) credit the current political administration as the main reason. Meanwhile, 33% of them say they are motivated by other factors, such as personal and financial reasons, and another five per cent say it is due to increasingly extreme weather conditions, like hurricanes, flooding and forest fires.
“The polarizing political climate in the United States is prompting many Canadians to reconsider how and where they spend their time and money,” said Phil Soper, president and CEO, Royal LePage. “Canadians have been the most important foreign investors in America’s residential real estate market for years, and a significant wave of property sales would leave a noticeable mark on the regional economies that snowbirds support.
“While wealthy buyers from China and other nations also spend a great deal on American residential real estate, purchasing expensive properties in major cities as investments, Canadians actually live in the neighbourhoods where they buy. They shop locally, dine out, volunteer and join pickleball leagues. Places like Florida, Arizona and California stand to lose millions in economic activity each year – and thousands of neighbours – if Canadian owners pull their capital from U.S. housing markets.”
Of those who sold their property south of the border within the last year, 44% say it was due to the current political administration, while 27% say it was for personal reasons, and 22% because of increasingly extreme weather conditions.
“Not every decision to sell is politically driven. For many, the decision to divest will be due to changing personal circumstances, from reprioritizing financial goals to the simple decision to invest closer to home,” continued Soper. “For some, the upkeep and distance of a U.S. property has become more burden than benefit, and uncertainty around shifting, murky border rules is yet another layer of stress. For years, Canadians rarely gave the American border a second thought on their way to a winter break in the south. Now, many fear that easy neighbourly travel can no longer be taken for granted.”
Investment in U.S. Real Estate by Canadians on the decline
According to the National Association of REALTORS® (NAR), Canadians have been among the top two largest contributors of foreign investment in U.S. real estate for the last two decades, although transactions have been significantly lower the last five years compared to the majority of the 2010s. Overall, real estate professionals in the U.S. have reported more than twice as many residential property sales by international clients over the last year, the largest group of whom are Canadians.
“With so many Canadians citing concerns about the U.S. administration as a key reason for divesting, it’s evident that political instability is no longer just a talking point – it’s a catalyst for change,” said Soper. “This shift in sentiment is reshaping how Canadians think about cross-border investment. As uncertainty continues to cloud the U.S. political landscape, we anticipate more Canadians will redirect their capital into domestic real estate, reinforcing long-term confidence in Canada’s housing market and creating new opportunities for growth closer to home.”
When asked if they plan to reinvest the proceeds of the sale of their U.S. home into the Canadian real estate market, almost 1/3 (32%) of respondents who have recently sold or are planning to sell within the next year answered ‘yes’.
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