If the U.S. housing market heats up like Canada’s, renters and our kids might struggle to buy homes. Imagine U.S. home prices jumping by 30% to 50% because, believe it or not, Canada’s median home price is already 50% higher than in the U.S.! Plus, job and income prospects are stronger here in the States.
It’s tough to find comparable salaries in Canadian companies, which is saying something. The Canadian market is already pricey, and if people realize the U.S. market is undervalued, our kids could be priced out forever. If that happens, expect a major uproar from those who can’t afford to buy.
For parents, my advice is clear: buy your home as soon as you can and consider securing a property for each of your kids to give them a head start. By the time they’re out of college, they could own their homes outright.
When you look at the numbers, the situation becomes stark. Canadian homes cost about 75% more than U.S. homes, yet Canadians make about 10% less. No wonder so many eye the U.S. market, which aligns more closely with income levels.
While some have shied away from Canadian real estate, fearing a disconnect from economic fundamentals, I’d choose a U.S. property any day thanks to better job prospects, weather, and business opportunities.
Currently, about 35% of my net worth is in real estate, mainly in San Francisco and Honolulu, but I’ve been branching out to other regions since 2016. Considering how the markets are evolving, I’m thinking about increasing my real estate investments.
If U.S. prices were to catch up with Canada’s, the median U.S. home price could leap to between $612,000 and $700,000—a 75% increase from now. Such a jump would especially affect cities with robust economies.
We Americans might not realize it, but our real estate and lifestyle expenses, like splurging on new cars, are relatively affordable. Instead of overspending on depreciating assets, we should focus on real estate, which historically appreciates over time.
I’ve laid out strategies in my financial guides to help people achieve financial independence faster by making smart investment choices in real estate.
Looking globally, the U.S. ranks as the second most affordable country for buying a home when you consider income levels and housing costs, which is something not everyone understands until they’ve lived abroad.
The Canadian housing market continues to boom, despite economic downturns, and it’s not just about the cold weather or limited high-paying jobs. The real draw is the steady influx of international buyers who view Canadian and U.S. properties as bargains.
For those looking to invest in real estate, focusing on markets with stable governments and strong economies like the U.S. makes a lot of sense. And with foreign interest in U.S. properties rebounding post-pandemic, the demand is set to soar.
The U.S. housing market could very well revalue upwards, rather than seeing Canada’s market decline. This potential makes a strong case for investing in U.S. real estate now, as today’s prices might seem like a steal in a few years, especially if the market dynamics align with those in Canada.
