Approximately US$42 billion worth of residential real estate in the United States was purchased by foreigners in 2008, with Canadians accounting for nearly a quarter of this tally.
Chris Stephan, a lawyer with a background in and appetite for international real estate, sees a business opportunity in a number that big.
He recently launched Shared Homes International, a Red Deer company that offers a variety of services related to such cross-border transactions.
It provides help with legal and tax issues, connects clients with international property specialists and lenders, arranges for currency exchange, and assists in other ways.
“The market is enormous,” said Stephan, adding that many people have trouble finding qualified help when buying or selling internationally.
“I saw that there was a gap of knowledge in what Canadian professionals know about U.S. real estate issues and what American Realtors know about foreign withholdings and Canadian tax implications.”
As its name suggests, a key focus of Shared Homes International is arranging fractional ownership of vacation properties.
“We link buyers together through shared ownership structures, which results in them getting in a better vacation property at a lower cost,” explained Stephan, who is one of two certified fractional professionals in Canada.
“I think it’s more practical, it’s more cost-effective, it makes sense for a lot of people, and it’s also better for the environment because there’s less need for real estate development.”
Stephan, who grew up in Red Deer, obtained his law degree from the University of Saskatchewan in 2007 and a master of business administration degree from Queen’s University the following year.
He worked at law firm Gowlings LLP and in the legal department of Walton International Group Inc. in Calgary, and last year was admitted to the Alberta bar and passed the New York bar exam.
He also spent four years working in the United States and bought his own investment property in Texas last February.
The idea for Shared Homes International came while Stephan was attending Queen’s. The university even submitted his business plan to the CBC television program Dragons’ Den, where a panel of business moguls assess entrepreneurial ideas.
He launched Shared Homes International at the National Home Show in Toronto last month, and took part in last weekend’s Red Deer Home Show.
“The response has been phenomenal,” he said.
Ultimately, Stephan would like to integrate the concept of shared ownership with green resort development. He recently enrolled in the master of science in green building design program through the San Francisco Institute of Architecture.
Stephan thinks Central Alberta is a good location for his business, with plenty of prospective clients here and Calgary and Edmonton close at hand.
Demand for southern vacation property should increase as more baby boomers enter retirement, he said, with current low interest rates, the high Canadian dollar and undervalued U.S. properties providing further stimulus.
“My plan is to start doing seminars and workshops in different cities around Central Alberta and throughout Alberta and provide basic education for Canadians interested in buying U.S. real estate.”
More information about Shared Homes International can be found online at http://sharedhomesinternational.com.