Why buy in America:
- The price of luxury real estate remains competitive in the US. The recession and the continued devaluation of the dollar have opened the door for international buyers to find high-end property at extraordinarily good value. However even for the first time investor and the small international investors there are area in California to find investment property that may even give you a monthly return of 1% on your purchase price.
- According to the National Association of Realtors international buyers accounted for $82.5 billion, or 8.9%, of the $928 billion spent on residential real estate in the 12-month period that ended in March. .
- A favorable exchange rate, political stability, and the high status of US property ownership have generated an influx of foreign investment in California and Neveda. Well known places like Las Vegas and Southern California have some very good buys. Less known places like Lake County California have some extremely exciting investments.
- Waterfront, lakefront, beach property are all within the reach of a foreign investor. Canada remains the number one country for private, overseas investors. It accounts for 24 percent of all international sales, while China came second with 11 percent..
- An interesting aside is that sixty-two percent of international purchases were made with cash, a number that has increased since 2007. This, and the high price of homes, demonstrates the wealth of these overseas investors who are already heavily invested in their own country’s property markets.
- Transparency: In the US, real estate is very transparent. A new listing for sale is required to be posted to the listing service within 24 hours so that active listings are available to all agents. This is unlike in many other countries, where buyers have to go from agent to agent to find a property. We have access to all the listings in California and Nevada and can assist you in the sale of any one of them.
- At the closing of the transaction, when the property is transferred to the new owner, the new owner does not need to be in the US. Rather, the new owner can provide his or her representative with Power of Attorney and the representative will have the right to close the deal on behalf of the new owner. This is quite common and convenient for the buyer who does not want to come back to the US for the closing./li>
- Foreign Buyer’s overall tax liability may be different than that of a US resident depending upon the buyer’s home country’s tax treaty with the US, if any. Therefore, it is best to consult a local tax advisor that is familiar with the tax treaty. For instance, the capital gains rate for US residents is 15% (if the property was owned for more than one year). Foreign Nationals, however, could be required to pay a higher rate, depending upon their home country’s tax treaty with the US. A local tax lawyer who is familiar with your home country’s treaty would be the best resource for answers to these questions.
- Foreign buyers who finance their purchases with a 40% to 50% down payment will likely not pay income taxes on the net rental income for the first 10 to 15 years, since the US government is very generous when it comes to those expenses that are allowed to be deducted from rental income. Since mortgage interest, common charges, property taxes, depreciation of the asset over 27.5 years, insurance, and amortization of closing costs are all deductions against income, in the early years the property will generate negative taxable income. In future years, when the apartment is generating taxable income, such income can be offset by the prior year’s negative taxable income (a.k.a. tax loss carry forward). This results in no income taxes for many years. See the Cost Components of a Real Estate Investment section of this website for further information.
- FOREIGN INVESTMENT IN REAL ESTATE PROPERTY TAX ACT (FIRPTA) When a non-resident sells US property, the Internal Revenue Service wants to be sure they get paid capital gains taxes. Accordingly, the IRS withholds 10% of the gross purchase price of the property. When a US tax return is submitted reporting the capital gains tax, if there is any refund due, that money will be refunded to the filer
- Individual Taxpayer Identification Number An Individual Taxpayer Identification Number (ITIN), is a tax number for certain nonresident and resident aliens, who cannot get a Social Security Number (SSN). It can be obtained by filing a W-7 application with the IRS.
- GREAT INVESTMENT.
Best Realty with the co-operation of well qualified real estate agents in California and Nevada can aide you with all of your Real Estate Buying needs