Andrew Lambden of Ontario fell in love with Hawaii 20 years ago, but it took a favorable exchange rate to entice him to buy four acres in Kealanani, a luxury development on the northeastern shore of Kauai.

Canadian snowbirds are known to travel long distances in search of warmer climes, but in the past the expense of getting to Hawaii and the high cost of its real estate had deterred both tourism and property purchases.

Now, Canada’s strong oil economy and robust real estate appreciation has increased its citizens’s discretionary income. And, while Canadians still view Hawaii as a faraway locale, the buying power of their dollar has brought second-home and investment purchases within reach. Japanese buyers are still the top luxury purchasers in Hawaii’s high-end market, but prosperous Canadians are not far behind and real estate experts say that, in some parts of Maui, Kauai and the Big Island, they now dominate the international sales sector.

“One big factor for my purchase was certainly the Canadian dollar; it appreciated a tremendous amount over the last year,” Lambden said, adding that favorable exchange rates could save him 10 to 15 percent on his Kauai purchase.

The Canadian dollar now is worth about $1.02, compared with a low of about 62 cents in 2002. Last autumn, the loonie, as Canadians call the currency because of the dollar coin bears a loon’s image, surpassed the American greenback for the first time since the mid 1970s.

“The impact of these currency changes has been marked,” said Putman Clark, president and chief executive officer for Clark Realty on Hawaii’s Big Island.

In the 1970s Canadians purchased two-thirds of all new development in Waikiki; this time, more are interested in the resort properties on the Neighbor Islands, said Stephany Sofos, a real estate analyst in Honolulu.

While sales have slumped in some parts of the Hawaiian real estate market, the shortage of properties and the diversity of potential buyers have kept prices more stable than those on much of the U.S. mainland, said Scott Higashi, executive vice president of sales for Prudential Locations.

“In terms of sales, Oahu is tracking lower than the U.S. mainland,” Higashi said. “However, through March, prices were only off three-tenths of a percent as compared with an 8.3 percent drop nationally. Many people from outside of Hawaii think of the islands as a great place to live and that diversity has pushed average sales prices up.”

International buyers from Japan, Korea, China, Canada, Europe, Oceania and Russia are still interested in Hawaii real estate, especially on the luxury end - and “the higher end of the market is continuing to perform really well,” Higashi said.

Lambden, who bought a lush ocean-view tract in a development where land prices range from $500,000 to $3 million, is like many of his fellow Canadians, who see Hawaii real estate, particularly on the Neighbor Islands, as a value-based investment with growth potential. “We believe that the U.S. economy will strengthen over time,” he said.

In addition, buyers like Lambden, who are used to Canada’s strong residential real estate values, are not experiencing sticker shock when it comes to home prices.

“The west coast of Canada is a very expensive place so it’s not much of a stretch to buy in Hawaii,” Lambden said. “I looked at real estate in other locations, but I choose Kauai, mainly because I think it’s the prettiest place on the planet.”

Hawaii stacks up well both in price and quality to other top resort and second-home destinations favored by Canadians, said Alexander Gray, president of Skylight Global Investments, who also owns luxury real estate in New York; Daytona, Florida; and Las Vegas. “I’m very choosy,” said Gray, who works in Toronto. “I only buy properties in the best vacation spots in the world.”

“Hawaii is a strong market. It has sustainability like New York,” said Gray, who just purchased one of The Residential Suites at The Ritz-Carlton, Kapalua in Maui. “The Hawaii market is softening now, but the Ritz-Carlton project is unique and I believe that it will have strong resale value down the road.

“They are experiencing a robust economy there and they are looking for opportunities elsewhere,” Charles said, adding that Canadian buyers, who represent Kauai’s biggest international market, now comprise 10 percent to 15 percent of her business.

Many of Charles’s Canadian clients are looking for Kauai properties that are selling for more than $1 million, she said. They seem to favor Poipu, on the southern tip of Kauai, where most Kauai condominiums are priced from $600,000 to $1 million and single-family homes are in the $1.5 million to $2.5 million range, Charles said.

Japanese buyers, who have long been active in Maui and the Big Island, are still buying and selling real estate. But now Canadians are keeping pace, said Howard Dinits, a Remax agent with Island Surf Realty, who specializes in selling Big Island and Maui properties.

Canadians also have been particularly drawn to the Big Island, where single-family oceanfront condominiums can still be found for $500,000, Clark said.

Kona and Keauhou, on the Big Island’s west side, have long been favored destinations for Canadian second-home and resort investment buyers. But in the 1960s and 1970s, when those resorts were being developed, most of the Canadian buyers had blue-collar backgrounds, Clark said.

“During this Canadian buying cycle, far more of them are arriving with wealth,” he said.

Original article can be read here.