Forum Replies Created
Hi Lawsjs,
Thanks for your posting. <moderator: delete personal comment>
I would even suggest one step further then checking on Zillow……do yourself a favour and spend a few hundred dollars on a proper appaisal (valuation)…..zillow does have faults in it's methodology but gives you an idea.
Hi Stuart,
I suggest that you contact James Simango at http://www.USTaxCentral.com James is a US & Aust CPA and can give you advice from both the US side of affairs and how it impacts on you in Australia.
Hi Streamline,
If it's of any use…..if you have a Florida based LLC… I have a person at Wachovia in Florida who will open both a business account (for the LLC) and a personal account (for you) if needed. All done pretty easily without you having to leave Australia.
PM me & I'll pass on the contact details.
Charles 1 wrote:Interesting article in Property Update yesterday on investing in the USA.http://propertyupdate.com.au/articles/is-the-investment-grass-really-greener-in-the-us.html
Read it and take out of it what you will. There are always different opinions on how and where to invest
Interesting that this sounds like a recent article from Neil Jenman. Both even made the exact same mistake of saying that if Americans can borrow at rates of 0.50% why aren’t they buying the properties. This sort of statement is crap.
1. Banks simply aren’t lending regardless of how great your credit score is. They can make better returns on the markets and have no incentive to lend
2. Americans cannot borrow at rates of 0.50%. Anybody can research that and see thats a load of bull
Statements like this reak of someone who has their own agenda and have no credibility
To all those posters to this thread who have given praise to MyUSAProperty………I am not questioning the level of their service or their promptness to answering questions you have or even their level of expertise and knowledge…..we get it….they have given you great service. What I'd like to ask you is did you get your own independant appraisal when you purchased. I mean a real appraisal carried out by a licensed appraiser…..not looking up Zillow.com
You would also probably be interested in another thread in this forum https://www.propertyinvesting.com/forums/property-investing/help-needed/4322475
<moderator: delete>
To all those posters who have been so glowing in their reports of MyUSAProperty……..nobody is questioning their "service" or their "skills, knowledge & expertise" in assisting you to invest in the USA real estate market…..what I am questioning is the property and the prices they sell them to you for. Has anybody even bothered to get their own independant appraisal (not looking at zillow or the like either…I mean a real appraisal).
You might also like to look at another thread on this forum https://www.propertyinvesting.com/forums/property-investing/help-needed/4322475
I can 100% confirm that the Tony that everybody keeps referring to is the one and the same Tony Richards….father of Trent Richards who is the Australian licensee of MyUSAProperty after Insight Property Group went broke <edited by admin to remove personal comment about Richards>.
Hey Rick,
How are your 3x purchases going in KC through MyUSAProperty ? Your last post you were nearly over the line with the finance
Spyglass…
The S&P/Case-Shiller Home Price Indices originated in the 1980s by Case Shiller Weiss's research principals, Karl E. Case and Robert J. Shiller. At the time, Case and Shiller developed the repeat sales pricing technique. This methodology is recognized as the most reliable means to measure housing price movements and is used by other home price index publishers, including the Office of Federal Housing Enterprise Oversight (OFHEO).
What reliable and up to date research can you point me to that would give me confidence investing in the area's of Florida you suggest ?
Hi Husky & Michael,
Yes you are correct. This forum does have it's share of people trying to sell you something and you would be amazed (or perhaps not) at some of the connections when recommendations come into it. I have already expressed my opinions on all of the so called "buyers agents" that operate from Australia selling US real estate. I think they should change their names to "wholesalers agents"…their just another middle man collecting their cut as you pass through.
Should it hold you back from entering the US market…….I don't think so. You just need to be careful and look twice. I would also suggest you seeing the market first hand before you jump in if you plan to use someone's services….don't take everything they tell you as gospel. Just cause the price looks ridiculous compared to what your used to paying in Australia doesn't mean you throw all investment principles aside.
Husky,
Maybe to help you narrow down the search you can look at where NOT to invest. Some new data came out today from the S&P/Case Shiller House Price index which is a monthly report. The latest stat's are for the month of November and most are starting to predict a double dip in home prices which should be confirmed by their spring time. You can see the latest report here http://www.standardandpoors.com/indices/sp-case-shiller-home-price-indices/en/us/?indexId=spusa-cashpidff–p-us—-
I also came across some interesting predictions from Case Shiller that came out in December 2010. They reported15 housing markets that would fall in value the most by 2012 which were
#1 Naples FLORIDA
#2 Las Vegas NEVADA
#3 Miami FLORIDA
#4 Ocean City NEW JERSEY
#5 Phoenix ARIZONA
#6 Gainesville FLORIDA
#7 Fort Lauderdale FLORIDA
#8 Atlantic City NEW JERSEY
#9 Orlando FLORIDA
#10 Punta Gorda FLORIDA
#11 West Palm Beach FLORIDA
#12 Cape Coral FLORIDA
#13 Pensacola FLORIDA
#14 Salinas CALIFORNIA
#15 Prescott ARIZONANot looking good for Florida to have 9 out of the 15 area's predicted to fall the most…would certainly have a drag on the whole states economy
Hi Levitt_Two,
You state that you are new to property investment ?? A couple of tips from my perspective…
1. Be VERY careful investing in the LV market…..there are some very bad area’s and without knowing exactly where your talking about…the price point you mention may give you some indications. Some area’s are riddled with crime and huge unemployment rates. Nevada has the highest foreclosure rates and is nearly double the next worst state Arizona. It also has the worst unemployment rates in the US. Combine this with the worst rental vacancy rates and your asking for some troubles as an investor.
2. Your looking at condo’s which means HOA fee’s. Do your research and you will find many HOA’s are going broke and the other owners aren’t paying HOA fee’s. Try getting any maintenance with a HOA that is broke and can only fund costs from higher HOA contributions from the remaining owners.
3. Your very unlikely to get any finance involved with a purchase price of $15K or even $60K. You might have some luck getting finance through a hard money lender but rates will be above 15% and on short loan terms.
4. If you do happen to be fortunate enough to get a tenant after waiting weeks (and in the meantime your air conditioning unit is stolen for the copper wiring), you face a problem with rising HOA fee’s and loan repayments from a hard money lender. All up it can turn what you thought was going to be a postive cashflow experiance into a nightmare that keeps sucking your money
I don’t want you to think I am negative or against US investment as I have invested in the US and plan to buy more. I applaud you for wanting to invest and give it a go but I’d hate to see you lose money on your first IP. Do some more research and look beyond the price point and promised gross/net return. Look at the basics such as unemployment rates, crime rates, past growth rates, where the population is moving etc. There are plenty of bargains in the US but also plenty of “dud” deals that nobody should touch.
Good luck on your endevours
Treasure Hunter wrote:Hi Speedy,Thanks for sharing your clear thinking on your approach.
I gather from some of your other posts that you concluded that Texas works for you. I understand their local economy is (relatively) strong and unemployment is lower. But it also appears that Texas never had the property value plummet that Florida, Arizona etc had. So based on this, one must assume that their residential properties do not have a forecast of strong capital growth, as there is no low point to bounce back from….
So no disrespect intended, but I am just being the Devil’s Advocate here and testing you on this point :- Weighing up the vacancy and unemployment rates potentially affecting IP cash-flow for Florida but adding the likely prospect of strong long-term capital growth, surely that is a stronger case than Texas’s possibly more predictable cash-flow but lower ROI’s and very limited growth?
(apologies if I have been incorrect with assuming your Texas position. I have not been through ALL of your posts).
Cheers, TH
Hi Treasure Hunter
No disrespect taken at all….we should be here to support each other and offer views and opinions. Yes Texas come out on top on all counts through much research. I can’t see many markets bouncing back for a long time as the fundamentals have changed. What drove markets like Florida has changed. Typically cashed up snowbirds and baby boomers sold their homes in the northern states and retired to sunny Florida. These people now have to put off retirement and most likely suffer from negative equity so can’t sell. Information from the 2010 census etc indicates that the population shift to Nevada, Arizona & Florida has slowed or stopped.
My investment principle….past returns are not an indication of future returns.
I agree with you White Goodman,
It’s all in the numbers…..not in the spin. My USA property don’t mind reminding you of the fact when comparing Australian property to USA property….it’s part of their sales spiel. They tell you the amazing fact that when “you pay stamp duty on an average Aussie property in Victoria of $450,000-00 you pay $27,000 in stamp duty which equates to approx 6% of the purchase price” Well if you bought only one property through My USA property for say $40,000…got a loan from LoansUSA for whatever loan amount….you pay approx 15% of the purchase price in set up costs….more then double what they spruik as outrageous in Victoria !!
Hi Sav,
Do you mind if I ask “why” are you specifically interested in Miami or Las Vegas ? It’s a question I have been meaning to ask many posters on the forums as to what made them invest in a particular city. What or who lead you to the decision so early on in your investigative stages of USA investing to isolate it between two cites already. I’m not critising your decision in any way Sav….just interested.
There are some excellent posts in these forums….some from individuals who have or are doing it on their own and some from those representing companies who have something to sell you. To me it makes common sense to first of all get the basics down first.
1. Ask yourself why you think you should invest in USA real estate to begin with. The common answers would be a) exchange rates with USD, b) current opportunity due to GFC, c) positive cashflow, d) possible future capital growth plus many more
2. If you have convinced yourself with the opportunity then look at which state of the USA. Research statistics such as unemployment rates which is pretty easy to find through the Department of Labour. Research population statistics. This will again be pretty easy. I came across 2010 stats from a very large removalist company in the USA who have been keeping stats on on interstate moves for the last 20 years. Over 75,000 jobs were completed last calendar year moving people from within the state, out of the state or into the state etc. Some very interesting stats are emerging which evidences the slowdown in the population shift from the north to the states of Arizona, Florida, California etc. It shows which states are currently gaining the population. This report is also backed up from stats starting to come out of the 2010 census. Look at where the jobs are currently going to and in what industries. Avoid states that have large public employment payrolls as a lot of states are going to have to lay off public servants to manage their budget deficits. You need to look where private company employment growth is happening
3. Once you have then identified the state with the best investment you can then narrow down your search to which cities in particular you should invest in using similar methods as above
I personally then believe only then should you consider things such as bank accounts, LLC’s etc etc. A lot of companies set up to sell US properties and offer the whole package are simply taking advantage of the fact that it is all too hard to do it yourself and believe me….from someone who has done it all on my own……is DOES take a lot of time and effort but it is possible. I have been fortunate to have had previous experience in the USA real estate market plus had the last 9 months off work to do some extensive research on the computer, on the phone and on the ground doing the hard yards. This is something that not everybody would be able to do. My point again is that these companies take advantage of this fact and 99% are selling in inferior markets just because this is the areas where wholesalers have huge inventories of stock that need to be sold to the unsuspecting investor.
Take the USA out of the equation. Would you invest in an Australian city that had high unemployment, was losing population and simply wasn’t located where all the jobs are being created…..JUST because it offered positive cashflow. There is huge amounts of current data out there backed up by reliable sources who aren’t selling you real estate.
Sav,
If the property and rental income is located in the USA then you must lodge tax returns with the IRS. The owner will claim expenses against earning the rental income including building depreciation on your US tax return.
You will also complete the tax returns in Australia like normal (as an Aussie taxpayer you need to declare worldwide income) but any tax already paid in the USA is given as a credit so you don’t get hit twice.
Like any investment…..you need to check with a tax professional first
Me again Klimmy,
I just looked back over your posts and noticed that earlier posts you went via HSBC to open up an account in the USA so you will need to check with them direct to see if you can build your credit score here
Hi Klimmy,
What you have opened is a USD$ account with HSBC Bank in Australia which will not build you a credit score in the USA.
Hi Want2Invest
The above post from cmason is 100% correct. By refinancing and transferring the debt to the IP….nothing is achieved. It’s not what secures the loan which determines the tax deductibility…it’s the purpose and in this case the ATO would determine the purpose as personal and not deductible.
Investigate either a)the option of selling the IP once you consider any CGT implications and repaying and non deductible debt or if the prospects for future growth is good…consider b) keeping the IP and using the equity for further IP purchases. The difference between a) & b) could be your affordability (due to the remaining home loan).
Hi Zads….welcome aboard.
First of all I know nothing about Brisol Tennessee….other then what I just read on Zillow.com .
You mentioned you have no equity in a house…..do you have any savings to contribute at all ? You will find it very difficult to find any lender willing to lend you money for a foreclosed property in the value of US$27,000…..and that has nothing to do with Bristol TN. Most lenders aren’t interested in houses less then approx US$75,000. My only suggestion would be to look into a hard money lender but not sure if even they will lend against a lower valued home. If they did you will pay interest rates upwards of 16% and the loan term would be restricted to a short term.
Good luck on your US investing endevours.
Thanks for your replies Eric,
I can appreciate Phoenix as I used to work there in 2001-2004 in the real estate industry. I still have many friends and contacts from that time….one is involved in shortsales in Phoenix…..could put you in touch with him if you PM me.
