Can foreigners and/or non-resident foreigners buy property in the US? The answer is Yes!
But how does one go about it?
There are many foreign investors who dream of buying property in the US and have many questions about how to go about it.
We recently bought an investment property in the US and we will show you what we did – step by step.
In the US, foreigners and non-resident foreigners are free to buy and own property. If you wish to buy property
as an investment, you want to research which areas has the most potential for growth and do your research.
Also, unlike in Japan where most people want new houses and condos, most properties bought and sold in the
US are not new. The areas with the highest household income and property values are the big cities such as
Los Angeles, New York and San Francisco. These cities are very popular but also very expensive. There are other
places and cities in the US which are growing and have lots of potential. It is important to conduct some research
into various cities and look at properties within your budget.
Once you decide on an area, it is important to find a realtor who not only knows the area well but is experienced
in handling international transactions with non-US citizens and residents. Realtors who have a CIPS
（Certified International Property Specialist）qualification are ideal because they have training and experience
in dealing with overseas buyers and can guide you through the process.
Once you set your area, you should decide on what kind of property you want to invest in. Condo? Residential Home?
Low-rise? High-rise condo? City center? Suburban? How many rooms?
Once you have a general idea of what kind of property you want, your realtor can search the MLS (Multiple Listing System)
for a property that will suit your parameters. If you live abroad and can’t actually go see the property, you can ask your
agent to send you photos or even take a virtual tour of the property.
Once you have found a property and are satisfied that it meets your criteria, you can put in an offer to the seller.
What to include in the offer is usually the following: desired purchase amount, whether you will purchase through
cash or loan, desired settlement date.
Once you put in your offer, the seller can do one of three things: they can accept, reject or come up with a counter-offer.
This is where the skills of the realtor you chose will come into play, as they will negotiate with the seller on your behalf.
You will need to open a US bank account for rental deposits from investment properties.
We travelled to the US and opened an account at a bank in California as it needed to be done in person.
You will always want to conduct a home inspection to make sure that there are no structural flaws in the property
you wish to buy.
After the inspection, the inspector will write up a report detailing any repairs or maintenance issues that will need
to be addressed. With this in hand, you can negotiate with the seller as to repairs.
If both seller and buyer cannot mutually agree on repair and renovations, then the buyer can withdraw their offer.
Once the offer is accepted and the inspection is complete and repairs agreed upon, the seller and buyer will sign
the Purchase Agreement.
In the US, it is common to go through a Property Lawyer for the Agreement to make sure that everything agreed
upon thus far between you, the buyer, agent and seller is correct.
At this point, a 5-10% Deposit (Earnest Money) is usually required. This money goes into an escrow account until
the time of settlement.
After signing the Purchase Agreement, the next step is finalizing the Title Report.
Once you finalize payment on your property, the title (ownership) of the property will transfer to you and you will
also need to settle any property taxes, registration fees, commission, etc.
Once all of these transactions are complete, the escrow company will transfer the money to the seller on the day of closing.
Then the seller will give you the keys to the property and it is yours!
How was this guide helpful?
Please feel free to contact us if you have any question.