It is not necessary to be a U.S. resident to buy real estate in this country, as American law does not restrict the purchase of residential and commercial properties by foreigners. Foreigners do not need any special permit to purchase residential and commercial properties in the United States.
There are several types of housing in the United States, including:
- Single-family homes: These are standalone houses that are not attached to any other houses. They are usually built on a plot of land and are meant to be occupied by a single family.
- Apartments: These are units in a larger building that are typically rented out to multiple tenants. Apartments can be found in high-rise buildings or low-rise buildings and may come in various sizes.
- Townhouses: These are houses that are attached to other houses in a row or a group. Each townhouse is typically owned by an individual or a family, but the exterior maintenance and landscaping may be shared with the other units in the row or group.
- Condos: These are units in a larger building that are owned by the individual occupants. Condos may come in various sizes and may have shared amenities such as a pool or gym.
- Manufactured homes: These are homes that are built off-site and then transported to their final location. They are often placed in mobile home parks or on individual plots of land.
- Co-housing: This is a type of housing where residents live in individual units but share common spaces and amenities. Co-housing communities often have a sense of community and may be designed to be environmentally friendly.
Getting Started
First of all, you should decide on the state. There are 50 of them, and they differ not only in climate, but also in social and economic conditions, which greatly affects the cost of real estate. Next you need to decide on the property (an apartment, a vacation home, a townhouse, etc.) and the realtor (in the U.S. it is called a broker).
Internet portals to help:
- Zillow.
- Redfin.
In the US, you can’t do real estate deals without a realtor. Be sure to work through a good professional who is licensed and is a member of the NAR (National Association of Realtors). Preference should be given to a specialist who has experience selling real estate to foreigners. By the way, all commissions for the broker pays the seller, not the buyer.
We can say that this is the most responsible step, because a lot depends on the qualifications and experience of the broker, although there is no need to be afraid. As a rule, all brokers are a priori qualified, because it is quite difficult to get a license for this kind of activity in the USA.
Many people from the CIS are scared off by the real estate prices in the U.S.. If someone just wants to invest in real estate, they usually have no problems with money. But there is a category of citizens who want to immigrate to the United States. They are very concerned about prices. Although the opinion of a huge cost per square meter of living space in the U.S. is slightly erroneous.
How to Buy Real Estate in the U.S.
Here again it is important to consult with your broker: he will select a good option for exactly the amount the buyer can afford to spend. There are states where apartments cost even less than in the CIS. For example, in Connecticut and Utah. In any case, you can arrange a mortgage, which in America is much cheaper. This is a good option for those who are planning to move to the U.S. and get a job in their field. Wages in the ocean are known to be much higher than in the CIS countries. So you can successfully live, work, and pay your mortgage.
Remote Buying of Real Estate in the U.S.
You don’t need to fly to America to buy real estate. Today it is possible to buy remotely. If the state selected real estate transaction is executed by an attorney, you can simply execute a power of attorney for him, and the specialist himself will conduct the transaction from start to finish. Such a power of attorney can be made at the U.S. consulate in your country. There, the buyer will explain all the details of the transaction. A special trust account will be set up in the name of the lawyer, where the buyer can transfer money to purchase real estate. Then the funds are transferred directly to the seller.
It is worth saying that the risks of remote purchase is almost reduced to zero, if the buyer has found a licensed professional.
This is all true in states where the purchase is done through an attorney. In other states, it is done through an “escro” – a special company. There is practically no difference. The same way the necessary documents are prepared at the consulate and sent to the states. The money is transferred to a special account.
If the buyer wants to go overseas on his own, it is better not to take more than $9,999 with him. If the amount of cash exceeds this limit, the money will have to be declared. It is better in this situation to transfer most of the money into a trust account.
If the buyer is going to buy real estate on credit, you will have to open an account in one of the U.S. banks.
Important: Some domestic banks refuse to transfer money if the buyer is not in possession of a contract for the purchase of a residential property. There is also another stick that can get into the wheel of the buyer. It is desirable to have a document confirming the information about the origin of the money, so that the U.S. Customs did not have any suspicions. Such a document may be a loan agreement, or, for example, a contract of sale of real estate in your country.
Fact: foreigners are not taxpayers in the USA, so the imported amount is not taxed either.
Signing a contract to buy real estate in the U.S.
The deal from start to finish will not take more than a month, if it is not a question of buying an apartment on credit. If the object selected, the price suits you, and the broker is ready to begin work, he prepares an offer – a model contract, which is realtor association of the particular state. The document is signed by the buyer, and the broker sends these papers to the seller.
After that comes the stage of the contract of sale between the buyer and seller. There is no need to be afraid. This contract is signed in the company of a realtor. And the legal control is done by the Title Company and the Escrow Company. If the deal is done remotely, then instead of escrow comes into play the trusted person – the buyer’s lawyer (Closing Attorney).
At this stage the buyer makes a deposit: about 5% of the value of the object. Now checks the condition of the property. It must be said that in this respect the Americans are good. Specialist will identify defects in the property, faulty plumbing, electrical wiring and other utilities. These services will cost $300-500. For an additional fee, the specialist will look for termites, radon, mold, etc. In other words, the uninhabitable property will not be sold. After that you should pay for the apartment in full and get a document on the right of ownership – “deed”.
Important: Real estate in the U.S. must be insured. It is a legal requirement. The insurance is handled by the title company, and then the policy is given to the buyer.
Additional costs to purchase real estate in the United States
So, as mentioned above, 5% of the purchase amount receives a broker, and usually pays it to the seller. He also bears the cost of tax on the transfer of ownership of real estate. Services of a title company (or a lawyer), insurance and various fees are paid, as a rule, by the buyer. This is approximately 1-2%. Although, in fact, additional costs are shared between the parties when the contract is signed.
