Sunbelt Migration: Why Canadians Are Buying in Florida and Texas

The US Census Bureau's most recent state-to-state migration tables continue to show Florida and Texas as the two largest net recipients of domestic movers in the United States, while the National Association of Realtors' annual international transactions report has put Canadians at or near the top of the foreign buyer list in Florida for more than a decade. Canadian share of foreign-purchased US homes by dollar volume remained in the mid-teens in the most recent survey, with the bulk of activity concentrated in the Miami, Tampa, Orlando, Naples, Phoenix and Dallas-Fort Worth metros.

What is changing is the composition of those buyers. The traditional snowbird profile, retirees splitting the year between Ontario and a Tampa-area condo, is now joined by working-age Canadians using remote-work arrangements to spend longer stretches south of the border. Royal LePage's recurring cross-border commentary describes a steady widening of the buyer demographic, particularly in metros where unit prices remain a fraction of comparable square footage in Toronto or Vancouver and where direct flights back to Canadian hubs are frequent.

The Sunbelt cost stack

On paper, the carrying cost gap is meaningful. Texas levies no state personal income tax, and Florida levies neither a state personal income tax nor an estate tax. Florida's homestead exemption under Article VII of the state constitution reduces assessed value on a primary residence by up to $50,000 and, through Save Our Homes, caps annual increases in assessed value at 3%. Texas property tax rates run materially higher than Florida's, often in the 1.8% to 2.6% range of appraised value once school and county levies are stacked, but the Texas Property Tax Code's homestead provisions and 10% assessment cap on primary residences soften the impact for owner-occupants.

For Canadians buying as non-residents, the carrying cost stack looks different. The IRS treats sales of US real property interests by non-residents under FIRPTA, which generally requires a 15% withholding on the gross sale price unless reduced through a withholding certificate. Rental income from US property is reported on Form 1040NR and is subject to either a flat 30% withholding on gross rents or, by election, net-basis taxation at graduated rates. Cross-border buyers also need to coordinate with the Canada-United States Tax Convention to avoid double taxation, which is work for a cross-border accountant rather than the listing agent.

“Canadians remain the largest foreign buyer cohort in Florida, and the shift toward year-round occupancy is reshaping demand patterns in the mid-price segment.”

Insurance and climate are now part of underwriting

The cleanest tailwind for the Sunbelt thesis runs into a clear headwind on the insurance side. Florida's homeowners insurance market has been under pressure for several years, with Citizens Property Insurance Corporation, the state-backed insurer of last resort, growing well above its historical share before recent reforms. Premiums in coastal Florida counties routinely run multiples of comparable inland exposures, and lenders increasingly require wind, flood and named-storm coverage as separate policies. In parts of Texas, the Texas Windstorm Insurance Association covers Tier 1 coastal counties on a similar last-resort basis.

Underwriting a Sunbelt purchase now means pulling an insurance quote before the offer, not after. Buyers who skip that step routinely discover at the inspection stage that the home's roof age, elevation certificate or distance to coast pushes the annual premium past what was budgeted, which is enough to flip a cash-flow positive rental into a loss.

What the numbers say to do

For Canadian buyers focused on lifestyle, the math still works in markets where insurance is contained and property taxes are predictable, most clearly in inland Florida and the suburbs of Austin, San Antonio and Dallas-Fort Worth. For pure investment, the cleanest path remains diversified exposure through publicly listed US apartment and single-family rental REITs, where the operating complexity, insurance and tax filing are handled by the issuer. Tax rules, homestead caps, withholding rates and insurance regulations differ by state and change frequently; verify current rules with the Florida Department of Revenue, the Texas Comptroller's office, the IRS and a qualified cross-border tax adviser before transacting.