If you’re from Hong Kong, Singapore, China, or even India, real estate prices have increased beyond the point of where you can maintain a positive yield, but this isn’t true in the USA. So, can foreigners buy property in USA?
Yes, but no one said that trying to buy a home in America as a non-U.S. citizen, resident, or foreigner isn’t going to be tricky, at least initially.
If you’re wondering whether a non-resident can buy US real estate, the short answer is “yes”, but it’s easiest if you pay cash. If you need financing to purchase US real estate as a non-citizen, getting a mortgage is challenging, which is why America Mortgages ONLY specializes in these types of mortgages.
Can Foreigners Buy Property in USA?
Anyone may buy and own property in the United States, regardless of citizenship. Hong Kong, Singapore, China, Indonesia, and other countries in Asia focus on the U.S. when investing in real estate. Since there are no laws or restrictions that prevent individuals with foreign citizenship from purchasing or owning property in the USA, it is the perfect place to invest.
Besides investment in real estate, many foreign nationals /non-US residents purchase vacation homes in the United States. Many wealthy foreign investors purchase investment property such as multi-unit apartments or condos, single-family homes, and even business properties like shopping malls.
Getting a US mortgage as a non-resident
Purchasing a house in the U.S. as a foreign citizen is simple if you plan to pay in cash (or having all the money saved to buy the home in one lump sum). If you’re not in the financial position to purchase a home with cash or find leverage is a better option for you, you’ll need to obtain a mortgage loan to purchase a property. This is where the process becomes tricky. Fortunately, America Mortgages’ primary focus is on the U.S. market, and its only focus is these types of mortgages.
Most U.S.-based mortgage lenders look at a borrower’s U.S. credit history to determine their eligibility for a mortgage loan. As a non-U.S. citizen, you don’t have a U.S. credit report, making it difficult for lenders to analyze the risk of loaning you money to purchase a home. That means your lender will elevate your risk factor as a borrower. This doesn’t have to be the case. Nor do you have to stay up late at night in Asia, calling lenders, brokers, and banks trying to find someone that will understand your situation. It may take you longer to find a lender who is willing to work with you, and it may take longer to get approval for your mortgage loan. You might also pay a higher interest rate.
We understand the complexity of analyzing risk, calculating foreign income, and alternative sources of acceptable credit verification. We do it all day, every day. It’s not difficult if you know the terrain, and in most cases, we can find a U.S. mortgage loan for every client.
Implications for Selling a U.S.-based Property as a Foreigner
Eventually, you might decide to sell your U.S.-based property. Before you purchase property in the U.S., it’s good to be aware of the rules and requirements should you choose to sell your property in the future. The IRS requires that buyers of property from foreign citizens withhold 15% of the amount realized on the disposition. If the buyer does not withhold this amount, they may be responsible for additional taxes. The rules surrounding this are somewhat complex but are outlined in the IRS FIRPTA publication, and more information can be found in the International Tax Gap Series.
It would be best if you worked with an agent you trust who won’t push you beyond what you’re comfortable offering or rush you into making a bad decision. Although we do not sell Real Estate ourselves, our network within the Real Estate world, especially within the U.S., is not only strong but also vetted. We are happy to point you in the direction of agents we have worked with in the past.
One of our associates or partners will be happy to answer any questions you may have regarding mortgage financing for your investment.
For more information, please contact [email protected].