Can a UK resident buy a property in New York City? Are there any restrictions?

Asked by Craig Austin, United Kingdom Sat Jun 7, 2008

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10
Ronnie Shuma…, Agent, New York, NY
Wed Jun 18, 2008
Your best bet is a condo. This is true if you are going to occupy OR if it's just for investment. A co-op will not allow you past any of the screening and leave you screaming!
This is the best time for a UK resident to buy here as the exchange rate is in your favor and makes it like a 60% discount!
0 votes
Jenet Levy, Agent, New York, NY
Sat Jun 14, 2008
Yes, for a condo. No for a co-op. I'd be happy to have a discussion with you to answer more fully. Please feel free to contact me.
0 votes
Joanna Lane, Agent, Cutchogue, NY
Sun Jun 8, 2008
Craig,
You need to understand the buying process on this side of the pond is very different with respect to the role played by the professionals. The UK is almost unique in not requiring estate agents to be licensed. Here and in most other parts of the EU, agents must be licensed. In some US States, agents can handle everything, there is no lawyer involved. New York requires you to have a New York Licensed attorney involved. Nevertheless, please understand that the legal responsibilities taken on by the attorneys here are significantly less than solicitors in the UK, so it's very important for you to be working with professionals here that have a thorough knowledge and experience of the differences and international sales.

I see that other agents here are saying that they are not licensed to practice law, only real estate, and therefore cannot give you legal advice. This is absolutely true, but what they are not telling you, because they may not know (and I wouldn't expect most to know) is that their license permits them to carry a lot more of the legal responsibility in the transaction than their UK counterparts. You may know that already, but if not, there is a huge area of confusion already about who is responsible for what in the transaction. As a professional in real estate in first the UK, then the US for more than 20 years, I have that T shirt!

New York Real Estate law requires agents to disclose to the buyer who they represent in the transaction, so the safest way for you to proceed is to ask whichever agent you decide to contact for exclusive buyer representation. This means that if you see a property you like, you do not go direct to the seller's agent because they are already signed up to represent the seller, then all they can offer is a dual agency arrangement, whereby they represent both of you in the transaction. I suggest that's not good enough in your situation.

It is absolutely NOT the case that "he who pays the piper calls the tune", in real estate here. On the contrary, it is very common for the buyer's agent to be paid by the seller's agent at completion of the deal, they split the commission between them. What you want is an arrangement whereby your agent will be required to be 100% loyal to you.

One tip I will share is to pay attention to the insurance you will need for your property earlier rather than later. UK insurance is very very different, and you will not be able to complete the purchase without insurance if a bank is involved (and I wouldn't advise that you do anyway even if you are buying cash). Unlike UK building policies you may have, your US policy will only have limited Liability cover, (slip and fall etc.) . Because of anomalies between the two systems, and depending on the value of your personal assets in the UK, that may not be nearly enough, and you will then need a custom solution from an insurance agent who again, understands the international issues.

I have various other people I can put you in touch with if you contact me offlist, including a British Accountant in Manhattan, who you may need to consult regarding tax implications if this is going to be a investment property, as you would then be subject to the dual taxation rules for income derived from rents.

By now, I have probably put you off the whole idea! Please don't be, you are very smart to think about buying here now - it's a great time to do it and not that complicated if you have someone to walk you through it who is on your side. If it's a buy to let you want, also consider the Hamptons and North Fork, in Long Island Wine Country, because it is a resort area with vacation rentals, only 2 hours from Manhattan. That's my area, whereas for Manhattan, if you get replies here from people with the necessary expertise, You would be better to deal directly with them. Otherwise, I would be happy to refer you to my contacts there.
0 votes
Joanna Lane, Agent, Cutchogue, NY
Sun Jun 8, 2008
Craig,
You need to understand the buying process on this side of the pond is very different with respect to the role played by the professionals. The UK is almost unique in not requiring estate agents to be licensed. Here and in most other parts of the EU, agents must be licensed. In some US States, agents can handle everything, there is no lawyer involved. New York requires you to have a New York Licensed attorney involved. Nevertheless, please understand that the legal responsibilities taken on by the attorneys here are significantly less than solicitors in the UK, so it's very important for you to be working with professionals here that have a thorough knowledge and experience of the differences and international sales.

I see that other agents here are saying that they are not licensed to practice law, only real estate, and therefore cannot give you legal advice. This is absolutely true, but what they are not telling you, because they may not know (and I wouldn't expect most to know) is that their license permits them to carry a lot more of the legal responsibility in the transaction than their UK counterparts. You may know that already, but if not, there is a huge area of confusion already about who is responsible for what in the transaction. As a professional in real estate in first the UK, then the US for more than 20 years, I have that T shirt!

New York Real Estate law requires agents to disclose to the buyer who they represent in the transaction, so the safest way for you to proceed is to ask whichever agent you decide to contact for exclusive buyer representation. This means that if you see a property you like, you do not go direct to the seller's agent because they are already signed up to represent the seller, then all they can offer is a dual agency arrangement, whereby they represent both of you in the transaction. I suggest that's not good enough in your situation.

It is absolutely NOT the case that "he who pays the piper calls the tune", in real estate here. On the contrary, it is very common for the buyer's agent to be paid by the seller's agent at completion of the deal, they split the commission between them. What you want is an arrangement whereby your agent will be required to be 100% loyal to you.

One tip I will share is to pay attention to the insurance you will need for your property earlier rather than later. UK insurance is very very different, and you will not be able to complete the purchase without insurance if a bank is involved (and I wouldn't advise that you do anyway even if you are buying cash). Unlike UK building policies you may have, your US policy will not include Liability cover, (slip and fall etc.) . Because of anomalies between the two systems, and depending on the value of your personal assets in the UK, you may well need a custom solution from an insurance agent that again, understands the international issues.

I have various other people I can put you in touch with if you contact me offlist, including a British Accountant in Manhattan, who you may need to consult regarding tax implications if this is going to be a investment property, as you would then be subject to the dual taxation rules for income derived from rents.

By now, I have probably put you off the whole idea! Please don't be, you are very smart to think about buying here now - it's a great time to do it and not that complicated if you have someone to walk you through it who is on your side. If it's a buy to let you want, also consider the Hamptons and North Fork, in Long Island Wine Country, because it is a resort area with vacation rentals, only 2 hours from Manhattan. That's my area, whereas for Manhattan, if you get replies here from people with the necessary expertise, You would be better to deal directly with them. Otherwise, I would be happy to refer you to my contacts there.
0 votes
Joanna Lane, Agent, Cutchogue, NY
Sun Jun 8, 2008
Craig,
If you are an owner of UK property, and only experience there, then you need to understand the process here is very different with respect to the professionals. The UK is almost unique in not requiring estate agents to be licensed. Here and most other parts of the EU, agents must be licensed. Is some US States, agents handle everything, there is no attorney involved. New York requires an attorney to be involved, but nevertheless, the responsibilities taken on by the attorneys here are significantly less than solicitors in the UK, so it's very important for you to have an experienced Real Estate agent here as they will be legally responsible for some aspects normally taken on by UK solicitors. New York Real Estate law requires agents to disclose to the buyer who they represent in the transaction, so for starters, make sure your agent represents your best interests in the transaction, not the seller. It is absolutely NOT the case that "he who pays the piper calls the tune", on the contrary, it is very common for the buyer's agent to be paid by the seller at completion.

One little tip I will share is to be very careful about insurance. UK insurance is very very different, and you will not be able to complete the purchase without insurance if a bank is involved (and I wouldn't advise that you do anyway even if you are buying cash). Unlike any UK building policies you may have, your US policy will not include Liability cover, (slip and fall etc.). That will be need to be separate policy, called an Umbrella (because it goes on top of everything else). What you need to bear in mind is that the umbrella goes on top of EVERYTHING, including UK owned property, and there could be BIG trouble at the 11th hour if you are not on top of this. This is one reason why you need an agent here who has the international knowledge and experience to guide you through and know not only where the pitfalls are, but also how to explain them to both you and your representative here in language you each understand.

You are very smart to think about buying here now - it's a great time to do it! If it's a buy to let you want, also consider the East End of Long island because it is a resort area with a lot of vacation rentals.
0 votes
Debt Free Da…, , 85260
Sat Jun 7, 2008
Money talks, If you have the money, the US has the property for you. Be prepared to put down 20% if you are a foreign national.
Web Reference:  http://getprequalified.com
0 votes
Michael Rich…, , New York, NY
Sat Jun 7, 2008
Craig,

The short answer is yes you can buy real property in New York, or anywhere in the United States. In fact, there recently was a new condominium that was entirely marketed and sold in Ireland. Other than being financially qualified to complete the purchase of your choice, I need ti defer to your legal counsel regarding possible restrictions. Being a real estate broker, I am licensed to sell real estate, not to practice law.
0 votes
Joanna Lane, Agent, Cutchogue, NY
Sat Jun 7, 2008
Hi Craig,
I am British and bought in New York well before I became a permanent resident here, so the short answer is yes you can. This is my specialty, so if you have any specific questions, feel free to contact me.
0 votes
Robert Nicho…, Agent, Boston, MA
Sat Jun 7, 2008
Hello Craig,
Their are no restrictions as far as purchasing real estate in the US, but the key is to make sure you have secure financing. Your options are cash, seller financing, a global bank, and the possibility of a US bank. With the current credit crisis in the US, lenders are imposing significant restrictions, and if you don't have US credit history, it will be extremely difficult. If you can find US financing your interest rate will most likely be very high. I would advise exploring all of your options to see which one gets you the best deal. Remember, you can always ask the seller if they are willing to finance the deal as well. If you need assistance, my team and I would be more than happy to help. I am the broker of a national online brokerage called SharpBuyers.com. We provide buyers with full service representation and rebate of up to 50% of our commission to the buyer at closing.
Best Regards,
Robert Nichols
Web Reference:  http://www.sharpbuyers.com
0 votes
Donna Quarto, Agent, Jacksonville, FL
Sat Jun 7, 2008
I do not see why not as long as you can get a mortgage with a bank you can have two residences anywhere.
0 votes
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