More Canadian investors are calling about buying properties in the United States than in Canada right now. That’s not a typo – cross-border investing has become that popular.
Tom McCormick, a Canadian engineer turned real estate investor, made the jump from Windsor to Detroit. His story shows exactly why so many Canadians are looking south for their next deal.
Why Detroit Makes Sense for Canadian Investors
Tom has been working in the U.S. since 2017, which gave him a huge advantage. He already had a Social Security Number, U.S. bank accounts, and a growing credit history. But the real kicker? The numbers just work better.
Here’s what makes Detroit attractive:
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Properties cost about two-thirds of what you’d pay in comparable Canadian areas
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Lower taxes than Canada
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Landlord laws that actually protect landlords
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Better Cash Flow – you can actually get close to the 1% rule
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Currency advantage when the Canadian dollar is weak
Tom put it simply: crossing the border for work felt like getting the best raise ever. That same advantage applies to real estate.
The Detroit Flip: A Real Example
Tom’s current project shows exactly how the numbers work. He bought a property in Detroit’s North End for $75,000 USD. The area is about 10 minutes north of downtown, and it’s improving.
The house needed serious work – around $100,000 in renovations. That includes:
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Structural repairs to fix sagging floors ($15,000 alone)
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Complete electrical rewiring
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Adding a full bathroom
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Converting to 4 bedrooms, 3 bathrooms
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Opening up the kitchen to the living areas
After repairs, the property should sell for $260,000 to $270,000. That’s roughly $85,000 to $95,000 in profit – not bad for six months of work.
Search US mortgage records to check existing financing and ownership details on Detroit properties before you make an offer.
Now compare that to Windsor. A similar Windsor Real Estate Investment: Ontario’s Hidden Gem Market $200,000 CAD just to buy, plus all the renovation costs on top. Even with the exchange rate, Detroit comes out way ahead.
The Financing Challenge
Getting a loan for this deal wasn’t easy. The renovations cost more than the purchase price – that’s what’s called an “upside down” loan. Lenders hate these because the numbers look backwards.
Add in that Tom hadn’t finished any U.S. flips yet, and some lenders won’t touch Detroit at all, and you’ve got a tough financing situation. Most lenders want to see 3-4 completed deals before they offer their best terms.
Dealing with an upside down loan where renovation costs exceed the purchase price takes the right lender — book a free strategy call with LendCity and we’ll find cross-border financing that works for your deal.
How Tom Got Started in Real Estate
Tom bought his first property in 2020, right when COVID hit. Not the obvious time to jump into real estate, but two things pushed him to act.
First, his job in the automotive industry suddenly felt shaky. He came close to being laid off and realized his salary wasn’t guaranteed. He needed another income source.
Second, his younger brother bought a duplex near the University of Windsor. Seeing his younger sibling take action lit a fire under Tom to step up his own game.
His first deal was rough. He bought a single-family home and tried to convert it into a house hack with an additional unit. He gutted it to the studs, ran out of money, and had to learn construction work himself just to finish the project.
His dad became his first investor, providing money to complete the basement unit. That injection of capital got the property cash flowing – barely at first, but it was a start.
The experience taught Tom everything he needed to know about renovations, building codes, and working with the city. It wasn’t pretty, but failing forward gave him the confidence to tackle bigger projects.
The Partnership Model That Works
Tom doesn’t fund all his deals alone anymore. He’s developed a 50/50 partnership structure that lets him scale.
Here’s how it works: Partners provide most of the capital and take a passive role. Tom and his brother find the deals, manage the projects, handle contractors, and deal with all the corporate and tax stuff. They also contribute money to cover costs until the first construction draw comes through.
Why split it 50/50 if partners put in more cash? Because Tom believes both sides need skin in the game. When everyone has equal stakes, no one feels cheated. No one wonders if they got a raw deal. That trust matters when you want partners to invest in your next deal and the one after that.
Tom isn’t looking for one-time investors. He wants relationships that span multiple projects. That approach has opened doors to more deals than he could ever fund alone.
Tom’s 50/50 partnership model works because both sides have skin in the game — if you want to structure similar deals, book a free strategy call with us and we’ll help you get the financing piece right.
What’s Coming Next
Tom has more projects lined up. Two more flips similar to the Englewood property – $60,000 to $75,000 purchase prices, six-month timelines, quick returns.
But the bigger opportunities are the multifamily properties. Tom’s looking at eight-unit and twelve-unit buildings that need complete renovations. These are longer plays – over a year to renovate, fill with tenants, and refinance to pull capital back out.
The refinance-to-add-units strategy is key. Buy distressed, fix it up, stabilize it with good tenants, then refinance. If the numbers work right, you can pull most of your capital back out and still own a cash-flowing property that hits close to the 1% rule.
That’s nearly impossible to find in Canada these days.
Getting Over the Fear
Most Canadians are scared to invest in the U.S. They worry about entity structures, financing, property management, and dealing with a different system.
Tom gets it. The fear makes sense. But he says you don’t need perfect knowledge to start. You don’t need the fanciest corporate structure. You need to take action.
Having guides helps. Connect with investors who’ve already done deals in your target market. Find a lender who understands cross-border financing for Canadians. Build your team before you need them.
Tom had advantages – he worked in Detroit and already had U.S. banking set up. But plenty of Canadians invest in U.S. markets they’ve never lived in. The key is starting, even if you’re not perfectly prepared.
The Bottom Line
Detroit gets a bad reputation, but that’s old news. Downtown is vibrant and safe. Neighborhoods are improving. Investment activity is creating more comparable sales data, which makes US mortgage financing easier.
For Canadians, especially those in Windsor, Detroit is right there. Why not take advantage of lower prices, better landlord laws, and strategies for fixing negative cash flow on rentals?
Tom’s projects show it’s possible. His first Canadian deal was messy and barely broke even. Now he’s running multiple projects in Detroit with strong profit margins and building a portfolio that would be much harder to create in Canada.
The numbers work. The market is improving. The currency advantage helps. If you’ve been thinking about cross-border investing, it might be time to stop thinking and start doing.
Key Takeaways:
- Why Detroit Makes Sense for Canadian Investors
- The Detroit Flip: A Real Example
- How Tom Got Started in Real Estate
- The Partnership Model That Works
- What’s Coming Next
Frequently Asked Questions
Why are Canadian investors choosing Detroit over Canadian markets?
What do I need to invest in U.S. real estate as a Canadian?
What is an upside down loan and why does it matter?
How much profit can you make flipping houses in Detroit?
What's the partnership structure for U.S. real estate deals?
Can you really achieve the 1% rule in Detroit?
How long does a typical Detroit flip project take?
Is Detroit really safe enough to invest in?
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Consult a licensed mortgage professional before making any financing decisions.
Written by
LendCity
Published
December 22, 2025
· Updated February 12, 2026Reading time
8 min read
Appreciation
The increase in a property's value over time, which builds [equity](/glossary/equity) and wealth for the owner through market growth or [forced improvements](/glossary/forced-appreciation).
Cash Flow
The money left over after collecting rent and paying all expenses including mortgage, taxes, insurance, maintenance, and property management. Positive cash flow is the primary goal of buy-and-hold investors. See also [NOI](/glossary/noi), [Cash-on-Cash Return](/glossary/cash-on-cash-return), and [Vacancy Rate](/glossary/vacancy-rate).
LLC
Limited Liability Company - a US business structure commonly used to hold investment properties, providing liability protection and tax flexibility.
Multifamily
Properties with multiple dwelling units, from duplexes to large apartment buildings. Often offer better cash flow and economies of scale.
Refinance
Replacing an existing mortgage with a new one, typically to access equity, get a better rate, or change terms. Investors commonly refinance to pull out capital for purchasing additional properties (cash-out refinance) while retaining ownership of the original property.
Single Family
A detached home designed for one household, the most common property type for beginner real estate investors.
Fixer-Upper
A property that needs repairs or renovations, typically priced below market value. Often targeted by investors using BRRRR or fix-and-flip strategies.
Property Management
The operation, control, and oversight of real estate by a third party. Property managers handle tenant screening, rent collection, maintenance, and day-to-day operations.
ROI
Return on Investment - a measure of profitability calculated by dividing net profit by total investment. Used to compare the efficiency of different investments.
Duplex
A residential property containing two separate dwelling units, either side-by-side or stacked. Duplexes are popular among beginner investors because they can house-hack by living in one unit while renting the other to offset mortgage costs.
Comparable Properties
Similar properties in the same market area used to establish fair market value or rental rates through comparison of features, location, condition, and recent sale or rental prices. Analyzing comps is essential when determining offer prices and setting competitive rents.
A Lender
A major bank or institutional lender offering the most competitive mortgage rates and terms but with the strictest qualification criteria, including full income verification and stress test compliance. Most investors use A lenders for their first four to six properties.
Draw Schedule
A plan specifying when and how much of a construction loan's funds will be released as building milestones are reached. An inspector verifies work completion before each draw is disbursed.
Real Estate Agent
A licensed professional who represents buyers or sellers in real estate transactions, providing market expertise, negotiation skills, and access to the MLS. Working with an investor-friendly agent who understands rental property analysis and financing strategies can significantly impact deal quality.
1% Rule
A quick screening formula where the monthly rent should equal at least 1% of the purchase price. A $200,000 property should rent for $2,000/month to pass the test. It's a rough filter for cash flow potential — not a substitute for full analysis, but useful for quickly eliminating poor deals.
Hover over terms to see definitions. View the full glossary for all terms.