Although the price of homes in Florida and Arizona is expected to keep rising this year, US housing remains an affordable investment for Canadians.

According to a Bank of Montreal (BMO) survey, housing prices in the United States have increased 19% over the last two years, but they are still only about halfway back to the peak they reached in 2006.

The median home price for major centers in Canada is about $230,192 USD (or $279,062 CDN), while BMO says that the median price of a home in Florida and Arizona is $169,400 USD and $192,100 USD respectively. "U.S. housing is inexpensive when viewed through the lens of international real estate," comments Jack Ablin, Chief Investment Officer at BMO Private Bank. "Residential real estate in Florida and Arizona is roughly two-to-three times median incomes. That is about half the valuation of many of America's trading partners."

Florida remains particularly popular with Canadians, who are the largest foreign purchasers in the state. According to BMO's survey, more than 500,000 Canadians currently own real estate in Florida, with Sarasota-Bradenton-Venice, Orlando-Kissimmee, Miami-Ft. Lauderdale-Palm Beach, Cape Coral-Ft. Myers, Tampa-St. Petersburg and Naples-Marco Island topping the list as the most popular areas.

According to BMO Capital Markets' senior economist Sal Guatieri, all of these regions except Miami were categorized as highly affordable in 2014; Miami was classed as modestly affordable.

"With the American economy and employment gaining strength, home sales and prices should continue to rise," says Guatieri. "We expect prices to increase about 4% this year, and we look for the U.S. greenback to strengthen modestly further against the Canadian dollar in 2015, before weakening next year."