Hey I am new and I have been doing a lot of research. I am tempted to Go to Myusaproperty.com, but I also came across a UK based one IPIN (www.ipinglobal.com) Was wondering if anyone has hear of them?
BUT essentially I want to start investing, but I want to know how much you need to invest? I have some money saved up, but i don't know if it is enough.
Opinions any one?
Hi Rosa, If you want inferior properties that are in questionable locations and are prepared to pay an overinflated prices then by all means use any of the services of the dozens or so spruikers that have sprung up in the last couple of years. As you have seen…they exist in Australia and the UK. They will predominantly sell in inferior markets of Michigan, Ohio, Arizona, Nevada, Florida, upstate New York…the list goes on. No surprise that these markets are the most depressed with high unemployment and high crime rates but they will do a good job of telling you all about the high gross returns. You will need at least $25,000-00 and no lending is available as banks won't touch the properties involved.<moderator: delete advertising>
speedy gonzales wrote:Hi Rosa, If you want inferior properties that are in questionable locations and are prepared to pay an overinflated prices then by all means use any of the services of the dozens or so spruikers that have sprung up in the last couple of years. As you have seen…they exist in Australia and the UK. They will predominantly sell in inferior markets of Michigan, Ohio, Arizona, Nevada, Florida, upstate New York…the list goes on. No surprise that these markets are the most depressed with high unemployment and high crime rates but they will do a good job of telling you all about the high gross returns. You will need at least $25,000-00 and no lending is available as banks won't touch the properties involved.Hi Speedy, I do not agree with your assesement of upstate NY, I have invested there and am getting good ROI, it all depends on the team that you work with. I would reccomend certain area's to invest in and other I would steer away from. I do agree with the other area's that you mentioned. I have personally invested in property in the Sydney market on & off for many years and have a good understanding of the process, I find that these spruikers are salesmen who have NEVER invested themselves. I do advise people on investments and believe that you can get a good deal if you have the correct business model in place. How can one advise anyone to invest in property if they themselves have not done it….thats my question to anyone wanting to invest in the USA, Sydney or anywere. Jeff
I have to admit I don't know what a spruiker is but I totally agree that the there's a difference between these property marketing companies which seem to be like a single focus estate agent that is just marketing these properties because its the latest hot item.
There used to be a joke in Florida a few years ago that when a traffic cop pulled you over he would ask for your Realtors licence, when asked why he would say that not every one in Florida had a driving licence……..{I didnt say it was funny,} I suppose the point im making is that when there are sales to be made salesmen appear, and when there aren't sales they disappear.
Hi Jeff,
By all means you are entitled to your opinion on upstate NY…….problem is that as soon as you mention the area you immediately think of Buffalo, Rochester etc. This area saw an influx of Aussie investors a few years back and everybody lost money. The gross returns promised realised into negative net returns and further loss upon sale due to continual frustration.
I take your point on board that it is possible sometimes if you have the right team. Also a good point that usually you find the salespeople themselves have never invested their own funds so how could you expect to trust them with yours
Where exactly do you recommend in upstate NY out of curiousity ?
Rosa,
We have bought four properties in Atlanta and two in Florida. The cheapest in Atlanta was $40k with $13k in renovations. The rental return is $950pm. Personally I would not buy off any Australian company that is based in Australia without heading over to the US and physically checking out the area and even the potential houses.
We used an Australian company based in the US (and travelled there twice) and bought foreclosures. We compared the foreclosure prices with past sales for the property, and with prices from other houses in the subdivision or close by. I dont get the whole 'take over their mortgage' scenario as this may mean you are actually paying 2007 prices and not 2011 prices which are often 60% or more less. Yes the interest rate is cheaper than what you would pay in Australia but you have literally wiped out any possibility for appreciation in the future. Makes considerably more sense to buy a foreclosure and have it renovated (its amazing what 10k can buy you in the US). With the four Atlanta properties, they all rented in remarkable time with the $40k house rented before the renovations even began. The reality is if you buy a good house in a good area, you wont have any trouble attracting good quality tenants.
Regards,
Canberra Girl
hello rosa,
we are going to atlanta in march and are looking more to savannah as an investment area. there are lots of duplexes available there and the savannah colleg of art and design is a great source for tenants. we hope to rent out one half and keep the other half for family and for extended holidays. We are finding it very difficult accessing finance from the US. We want to take advantage of the low interest rates…any suggestions?
thanks
Joeantonellis in Brisbaneactually that last comment was meant for canberra girl, thanks
joeantonellis in brisbaneHi Rosa
My partner and I have purchased several properties from Memphis, using My USA. We have had them all financed with out any issues. Per property I would allow about 30K.
As I have said a couple of times, call them and ask some questions.
Hi Joe,
We used equity in our house here to purchase the properties using cash. We then refinanced with one of the banks here and set up investment loans for the houses so we are paying interest only (but with an offset account attached to each one). The interest rates many of the US banks are charging foreigners are not much different to Australia – particularly if you can pick up packages that offer .75% or 1% less than the variable interest rate.
We now need to find out for sure if we can negatively gear the interest here as part of our personal tax returns. We set up a LLC for each property with the LLCs owned by a Delaware LLC. Read something about Delaware Series or 'cell' LLCs today which sounded simpler but I think its so new, there is still some uncertainty. About to make an appt with an experienced Tax Accountant.
In respect to locations, we have bought in Union City, College Park and Lithonia. Not sure about Savannah but you need to make sure your tenants have a stable job and are able to pay on time. The utility expenses there are quite high compared with Australia and their wages considerably lower so make sure you get a good property manager. In my experience they are not necessarily easy to come by.
Regards,
Canberra Girl
thanks canberra Girl, i appreciate the advice!
Joemelbourne girl wrote:Hi RosaMy partner and I have purchased several properties from Memphis, using My USA. We have had them all financed with out any issues. Per property I would allow about 30K.
As I have said a couple of times, call them and ask some questions.
Well I guess that I might have to save up a bit more money then. I am hopeful that I will be able to… Thanks also for all the guys on the states to avoid.. I will keep saving those pennies…or I could take out a personal loan to herm… i will have to think more on this issue. soooo…. I guess I will have to talk to some people…. which includes all the sales reps.
speedy gonzales wrote:Hi Jeff,By all means you are entitled to your opinion on upstate NY…….problem is that as soon as you mention the area you immediately think of Buffalo, Rochester etc. This area saw an influx of Aussie investors a few years back and everybody lost money. The gross returns promised realised into negative net returns and further loss upon sale due to continual frustration.
I take your point on board that it is possible sometimes if you have the right team. Also a good point that usually you find the salespeople themselves have never invested their own funds so how could you expect to trust them with yours
Where exactly do you recommend in upstate NY out of curiousity ?
Hi Speedy Gonzales,
Now I know that you are gonna think I am crazy, I am investing in Rochester, the reason being is that I have partnered with some local investors there who have the runs on the board, I agree and they do as well re bad deals done a few years ago by real estate sharks, who took money out of investors, however I have a partner in Denver, very experienced real estate advisor who has a good report on Rochester, no boom or bust steady, good returns, tenanted properties, well run property managment system in place.
I would have no problem reccomending Rochester despite it’s bad rap. You will never get a huge capital gain on purchasing a property for 50K-60K, but a positive cash flow, I am getting that.
The problem with the sunshine states is that a number of years ago speculators came in and purchased properties causing the prices to rise, thats why you see in Florida some houses were $180K a few years ago now selling for $60K, will these properties EVER get back to those prices….don’t think so. because they were never worth $180K to start with.
Jeff
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The point I want to make is you shouldn't pay any fees to any companies to find properties, membership fees etc etc. All the properties will have commission {normally 6% } built in. Essentially what it means is that there is three agents earning on the deal , the listing agent, the buyers agent, and the company charging the fee. Most of those charging fees tend to be one stop shops which only sell USA property and are purely opportunistic not property guys.
the only problem with set and forget investing….is that you really can forget… Liquidating my shares now so that will help with the saving a little. JOY!!!!! when they get sold…. i can then buy….. and set and forget my usa house…. joy!!!!!!
Can someone help us please ? My wife and I are really struggling, we still can't identify a location for USA PCF rental property. Any ideas which location is good ? We intend to buy in the next 4months.
Rich,
I will suggest doing a little more research on the US locations, shortlisting the market to 3-4 locations and then fly down to visit each location personally and invest in one you feel most comfortable with. If you are looking to buy multiple properties, then it would definitely make sense to fly down and pick a location that you have visited. If you are just buying one property, the cost of flying down may not be justified. In which case, you may need to find a company that can sell you turn key properties. Although, be very careful about how some of these companies calculate ROI on turn key properties. They conveniently exclude any maintenance on these properties.
Happy investing!
RichAd wrote:Can someone help us please ? My wife and I are really struggling, we still can't identify a location for USA PCF rental property. Any ideas which location is good ? We intend to buy in the next 4months.Some of the advice above is well noted.I would pick out a few markets in the USA…Then instead of worrying about buying. I would first worry about learning and flying to each market that you might be interested in.
There are plenty of people on these forums that will tell you each city is the best and why.
Save your self the long term headaches by doing a little bit of research, and ask questions….and please don't go with these super high returns some are promising….
Sincerely
AlexAs a matter of fact, as a pilot with many hours of flying around the US ( more than 1000) in my Cirrus Sr 22 I can catogorically state that you will not by flying down to the US but that you will be flying up or North to the US.
When we are in the states we call it flying down under. which in our mind means down or south to OZ.
A bunch of my buddies fly for US carriers out of SF down to Sydny et al. And When i was last in LA. And actually Alex and his crew were at the same venue, I had the privalage of watching a quantas A 380 approach and land, that was quite a site for a pilot like me.
I would have loved to be an airline pilot but just not the right age. In the US we have the most freedom to fly small aircraft than anywhere in the world its a true privalage, we can fly from airport ot airport with no tax or other burden like Europe.
Even when I fly to Canada a few times a year to go fishing, Once I contact Vancouver Center and check in then Kamloops Radio for landing instructions I end up with a 120 dollar bill mailed to me in the states. The when I go to the Kamloops weather station and get a breifing, depart on Kamloops radio swith to center ( Vancouver) then on to Seattle approach. I will get another bill from Nav can for 150 bucks, just to use their system. In the states this would be all free.
The states hands down has the best system in the world . Free movement through the controlled airspace. No charge to shoot ILS or NDB approachs or 'GPS approaches. We have it lucky thats for sure.
Rosa Tong wrote:the only problem with set and forget investing….is that you really can forget… Liquidating my shares now so that will help with the saving a little. JOY!!!!! when they get sold…. i can then buy….. and set and forget my usa house…. joy!!!!!!Rosa,
I have watched your posts for quite a while now since you joined the forum and I know you have been saving your hard earned dollars to get some funds together to buy in the USA which is great and your to be commended for your commitment.
I do feel compelled to make a comment about your "set and forget USA house". Direct property investment never has and never will be a set & forget investment. It is unrealistic to think that you won't have vacancy and maintenance issues that will require your direct involvement. Expect the tenants to be pretty hard on the property so depending upon the quality of the refurb….these items could need to be attended to within 12 months. Do you have the cashflow available if your Property Manager comes to you and tells you it will cost $2000 to bring the property back to a condition to re-lease to tenants ?
Then throw into the equation the fact that the property in is another country and another time zone and communication will involve late night and early morning phone calls (yes I know email exists but somethings have to be handled by direct calls). These are all things that a turn-key company you buy from won't tell you about. Funny they only mention the 15-20%+ returns and the upside. Never mentioned is the fact that expenses will come along that will blow their predicted return out of the water to a sub 5% and I would hate to see someone scrambling for the credit card for big expenses they never thought of or considered into the financials.All part of the fun of owning rental property but I just don't want you to go into direct property investment in any country (Australia included) without being fully aware of all the risks and implications. There is no trial period…once your in…your in for the long haul or your going to lose your dough. If you want a "set & forget" investment…then direct property investment isn't for you. Just how "involved" you need to be depends entirely upon the home itself, the quality of the refurb, it's location and how good your property manager is.
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