Home Buying in New York>Question Details

Dr.abhilash, Home Buyer in New York, NY

can a foreigner buy a house in usa? am from india?

Asked by Dr.abhilash, New York, NY Fri Aug 21, 2009

hi.i live in india..and plan to come to usa soon for doing a residency in medicine..anyways am planning to sell my ancestral property here and buy a house in usa and give it for rent. is this possible and is this a good idea??..and i don't plan to take a loan..and want to make a full cash payment...is it possible??..cause everywhere i see there is this 20% down payment and rest monthly payment structure in usa..and thanks in advance :)

Help the community by answering this question:

Answers

18
Namashkar, Doctor Dji, kya hal he?

There are a lot of foreign buyers coming back to the US to take advantage of our periodic 50% sale opportunities. You can get great deals on residential, commercial properties, especially on land, however, the rules of the game changed in the last 10 years, especially after 2001 Patriot Act, and you need to know the rules. I just wrote an article on this very subject for a Russian financial publication, here is a summary:

Yes, you can buy here, including "all cash", but you need to do a lot of planning prior to it, which is what most foreign buyers don't do:

(1) Before you transfer even a dollar here, make sure you can verify where the money came from. Any transfers over $10,000 into the US will be reported to the Feds, your all cash real estate buy will be reported to the Feds, and when the Feds come asking questions, you need to make sure that you can prove legal sources of your cash.

(2) When you rent your property, you will start receiving "US-based income", you need to make sure that you plan on HOW to receive it, and HOW it will be taxed, and WHAT's the best way to have access to it. You need to make sure you decide BEFORE you buy a property in the US if you are going to do this rental business as an individual, as a corporation, LLC, trust, pension fund, etc., all of which are options. They are not expensive to set up, and you can set them up remotely over the internet, but you need to make sure you do it before you buy the property.

(3) Don't assume that owning real estate in the US will automatically entitle you to a visa in the US. You can own $10 million of properties in the US, but still be denied an entry visa. So, make sure to get your visa first and then fly here to look at properties. DO NOT EVER BUY PROPERTIES SIGHT UNSEEN!!!

(4) Buying all cash might be great, but I would recommend that you sit down with a real estate investment adviser and see if buying with some type of financing will be financially more beneficial for your investment strategy because of leverage-enhanced ROI, distribution of risk among several properties, and other factors.

(5) PLAN YOUR EXIT FIRST!! Before you buy, you need to make sure you know what you going to do when you sell. Are you planning to sell for profit? Then when? at what tax rate for capital gains? and will you take the money out of the country? If you are planning to sell for profit but re-invest proceeds into another property, you need to become familiar with 1031 tax-deferred exchanges that allow you to trade and consolidate properties for years and decades without paying a dime of taxes until your final disposition. It's a great tool for smart investors that can make you very rich, but again, you have to plan for this strategy in advance and get advise from a knowledgeable person. Besides, when you are selling a property here as a foreign individual, you are subject to all kinds of withholdings regardless if you made any profit or not, including 10% withholding under FIRTA just because you are a foreigner, 3% withholding in California because the property is non-owner occupied, etc. But, if you hold title to the property as an entity, such as a corporation or LLC, you are not subject to many of these withholdings. Again, learn the rules and plan your strategy!

(6) Investing in real estate is a very hands-on enterprise. You must think through the details before you buy the first property. It's very hard to operate a rental business when you don't see what's happening yourself. I've owned many rentals and always managed them myself until I bought a commercial property in another city and hired an outside property management company. One of them embezzled over $20,000 from me, the other one embezzled over $3,000. As an adviser working with investors, I hear these stories every day. Lesson learned, you must control your assets and your income, but at what cost? How are you planning to control it physically? How can you do it while living in India or England and owning properties in the US?

(7) Finally, why Real Estate? Because of visa? Because of Income? Because of making it your future home? There are plenty of other investment opportunities that can provide you with similar ROI or visa opportunities, such as EB-5 visas (1 million dollar minimum), "Regional Centers" ($500,000 minimum), E-2 small investor visas ($200,000 investment), etc. Or you can combine several strategies, depending on your access to capital.

Bottom line: your investing in the real estate here should be a RESULT and the FINAL STEP of some serious planning path. Measure seven times, cut once, as we say in Russian. Feel free to contact me at alex@Recapitallink.com, would be happy to advise further.

Alex Lisnevsky, Broker
San Diego, CA
http://www.RECapitalLink.com
2 votes Thank Flag Link Mon Feb 15, 2010
Dr.abhilash
I am working with international clients and would be pleased to assist you in obtaining your real estate goals contact me nunzio.zappola@elliman.com or call 1(631) 422- 7510 extension 8224 I lokk forward to hearing from you.
1 vote Thank Flag Link Fri Aug 21, 2009
Hello Dr. Abhilash,

You can buy an apartment or house in New York for All Cash with your own money, no problem at all. As a matter of fact, sellers prefer buyers who have all money ready and can pay and close right away. If you pay All Cash with your own money, you will not have to pay NY mortgage tax, (which is about 2% of the loan amount) and you will save on various bank related fees. If you pay All Cash, the whole process will be also much simpler and faster, as you won't have to wait for mortgage approval.

On property listings, they often indicate, for example: "20% down", or "10% down". This just means that a buyer will have to put at least 20% or 10% down - not less than 20%. However, a buyer is always welcome to put down more, and the more you have, the better.

For your information, the real estate market is New York (especially in Manhattan where I work) is very busy and properties come and go fast. It means that when you start looking and you see something that you like, you might have to be ready to pay at least 10% contract deposit within a week or so. For cash payments, the sale is usually finalized within 1 month after contract signing- which means that you would have to pay the whole amount to the seller very soon. Now -from what I heard, transferring money out of India (and some other countries) is a long process that can take about a year. A seller will not wait that long for money to arrive, they want to be paid quickly -or they will move on to another buyer.
My buyers from India have to take care of money transfer out of India first, and then, once their money is in the US, they are ready to search for properties to buy and to make offers. (I thought I should bring this up just in case you might not be aware of these issues).

Please let me know if you have any questions.

Best regards,

Krystyna Rachtan, Licensed Real Estate Broker
Phone (212) 991-8072, Email: kr@nyhome.com
NEW YORK HOME REAL ESTATE SERVICES, INC.
295 Madison Avenue, 12fl, New York, NY 10017
0 votes Thank Flag Link Fri Oct 10, 2014
Yes of course. We represent foreign buyers all the time.
Here is a quick guide for foreign investors but geared towards New York. Good luck!

http://castle-avenue.com/Foreign-Buyer-Guide.html

Best,
Wei min
0 votes Thank Flag Link Wed Jul 2, 2014
I would be happy to help you in the Connecticut and New York Area, fell free to call me at 203-733-2814 or email me at donna.kuehn@cbmoves.com and I will help you with the process.
0 votes Thank Flag Link Sun Apr 20, 2014
Hi, what is the process of bringing $100,000 from Turkey? can i bring money with me? or do i have to let usa feds know it?
thanks
Flag Sun Nov 2, 2014
Hi Dr. Abhilash,

I am a home owner and myself own an investment property here in Nassau County, NY. I bought the apt in 2006 and have no problem renting it to professionals. At the moment, a physician in Nassau County University Hospital is renting my 1 bedroom and 1 bathroom apt. This is his 3rd year renting from me and his lease ends this September.

I maybe moving back to South East Asia, Singapore-Malaysia to be exact and am now putting the apt on sale. If you are interested, do check out the details here:
http://www.forsalebyowner.com/listing/HMCFB

Let me know if you have any question. I will try my best to assist you within my capabilities.

Good luck.

Sincerely
Fauziyah
0 votes Thank Flag Link Sat Jun 23, 2012
What a great time to buy in the USA. We are in a period in which is call: "A Buyers Market" because home prices are at it lowest. Contact me when you are ready to purchase.

You should also know your rights. I have posted a useful link for your information.

http://www.uscis.gov/files/nativedocuments/M-618.pdf
http://portal.hud.gov/portal/page/portal/HUD
http://www.fanniemae.com/kb/index?page=home
0 votes Thank Flag Link Sat Aug 13, 2011
YES! The Basic Requirements for Foreign Investors wishing to Purchase Real Estate in the US; FIRPTA (Foreign Investment in Real PropertyTax Act) are; Foreign Investors must acquire a US taxpayer identification number (TIN) before purchasing property.
Income resulting from the sale of US Real Property is taxable. The Capital Gains tax is calculated by using the Sale Price today minus the Original Sale Price, plus Capital Costs, minus Depreciation. Since this tax is approximately 20% of the gain, Sellers may consider an exchange. The time to divest can become the time to reinvest. Foreign Investors are taxed at a flat 30% federal tax rate on gross rental income, unless they take the "net election" on their income tax returns allowing them to take deductions for regular expenses before income tax is calculated. Furthermore anyone who collects income for a Foreign Investor is generally required to withhold 30% of the Gross Income such as rents.
Web Reference: http://www.clovelake.com
0 votes Thank Flag Link Fri Aug 12, 2011
Yes you can certainly buy in USA, visit http://www.BuyHomeInUS.com for more information on buying homes for foreiginers.
Web Reference: http://www.BuyHomeInUS.com
0 votes Thank Flag Link Fri Aug 12, 2011
Welcome Dr, of course it's possible you'll have to focus on a condo which will make it easier for you to rent and make a profit on the unit. Depending on your budget and location it varies in size. My theory is simple, for investment purposes you need to be open to all locations because in some areas of the city you'll get more for your dollar per sq foot then in other locations. Also keep in mind that condos by rule of thumb cost more, are usually smaller and you have higher closing cost but in the end if you're renting it you'll do well. Good luck, welcome to the states and I'm here if you need my assistance.
0 votes Thank Flag Link Mon Jan 25, 2010
Namaste Abhilash,

I have a same question like you. I also plan to purchase a property in the US, preferably in California since I studied in San Diego for 12 years. However, I'm from Belgrade, central Europe, and I work here now. As far as I know I think it's feasible to buy a house/appartment from India and rent it. To do so, I would advise you to open an account with any well known U.S. bank such as Wells Fargo or Bank of America.

In any case I wish you Shubhakaamana

Iva M.
iva.miladinovic@gmail.com
0 votes Thank Flag Link Mon Jan 25, 2010
Hi Dr. Abhilash,

How are you. As all of the other people answering your question clearly stated - anyone can buy property in USA. One does not have to be a citizen or even a resident. You may be surprised to learn how many foreign nationals invest their money in real estate in the USA.


As to paying all cash - you can certainly do so. There are no laws limiting how you pay for the transaction. Majority of people leverage their money by getting mortgage loans from the banks. It is the banks in most cases that require a minimum investment of 20% of your own funds in order to protect themselves.

Our company is not only one of the largest in the New York real estate, it also has a special program wherein investment properties are managed for foreign investors, freeing them of the day-to-day hassles encountered when leasing property to individuals or families. Here is a link to give you a little more information about this service:
http://www.halstead.com/globalservices_halstead360.aspx

Once you know the dates when you anticipate coming to New York, please give me a call and we can discuss details. My manner of working is to give my clients 110% and to always have their best interest as my ultimate motivation.

Sincerely
Anoop Punjabi
Halstead Property LLC
Email: apunjabi@halstead.com
Tel: (212) 317-7844
0 votes Thank Flag Link Sat Aug 22, 2009
YES you can purchase a home... if paying cash easy work with work than a loan.

ARE you relocating to Dallas Fort Worth area? If so contact my office I work with investors around the world.

CONTACT OUR OFFICE TODAY
972-699-9111
Lynn A. Crosby ~ National Featured Realtor
Follow me on Twitter: http://twitter.com/Lynn911
"...Specializing in Residential, Commercial Properties and Loans..."
Dallas Realtor, and Credit Repair Consultant -
The Michael Group - "Dallas Business Journal 07’ & 08' list top realtors"
Dallas Loan Officer -
Dallas Real Estate Website: http://www.lynn911.com 60,000 listings Dallas homes for sale
0 votes Thank Flag Link Fri Aug 21, 2009
You can purchase in the U.S, please remember a few things if you're looking to purchase a home in NYC you'll most likely purchase a condo or a co-op. Depending on your budget and location the apartment might be spacious or medium size. If you're looking to purchase a "home" you'll have to look at Brooklyn, Queens, etc..that's where you'll find your traditional house with a backyard, drive way etc.. I'm here if you need my assistatnce, good luck Dr, my brother in law went through med school, it's a long and tough journey but well worth it!!!!
0 votes Thank Flag Link Fri Aug 21, 2009
Absolutely.....the United States government is very receptive to "foreign Nationals" purchasing property in our country. This is a very good time to be considering investing in real estate.
0 votes Thank Flag Link Fri Aug 21, 2009
You are seeing "20% down payment" because most people mortgage the property they purchase through a bank. In your case, paying all cash will make your transaction fairly easy. Where in the USA are you thinking of purchasing? Please feel free to contact me at ams@corcoran.com for any of your real esate questions. I will be able to assist you anywhere in the USA.
0 votes Thank Flag Link Fri Aug 21, 2009
You are seeing "20% down payment" because most people mortgage the property they purchase through a bank. In your case, paying all cash will make your transaction fairly easy. Where in the USA are you thinking of purchasing? Please feel free to contact me at ams@corcoran.com for any of your real esate questions. I will be able to assist you anywhere in the USA.
0 votes Thank Flag Link Fri Aug 21, 2009
yes you can you just need to have a higher down payment.
0 votes Thank Flag Link Fri Aug 21, 2009
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2016 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer