Buying in the US

Discussion in 'Where to Buy' started by quiggles, 9th Nov, 2004.

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  1. BV

    BV Think outside the square

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    Hi Quiqqles,
    Congratulations, Keep up the good work.
    Being an experienced investor you would have checked out
    the population figures and trends in the area you are buying
    so as long as population is increasing there will be tenants
    for your IP's.
    Also, the US$ drop means its in your favour buying in the US
    right now.
    A thing crossed my mind though.
    Some countries have restrictions on who is able to buy property
    and particularly they won't allow low value investments from non residents.
    (If you are rich the doors are open)
    So my questions is, have you fully checked the issue?
    You are not going to be stuck with property that
    you were not allowed to purchase in the first place?
    Cheers
     
  2. quiggles

    quiggles Member

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    Yes, I did check that issue. the US does not appear to have much in the way of restrictions, although if I was Afghani, Iranian or Syrian I might have reservations and check things out more carefully. It's not like Australia, where buying investment RE can be quite difficult for foreigners.
     
  3. Aceyducey

    Aceyducey Member

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    The US is one of the most open markets in the world to foreign investors.

    And people wonder why they became so wealthy.....

    And the Japanese is one of the most closed..... :)

    Cheers,

    Aceyducey
     
  4. NIF

    NIF Member

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    Some friends have bought rental properties in a ski resort in Japan & didn’t have any hassles as all (and have made good capital gains).

    Why do you say Japan is closed ?
     
  5. quiggles

    quiggles Member

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    Actually my understanding is that Japan is not closed, the way Australia or Indonesia are. However, one of the major points about property is that leverage makes it work. And someone (Padosan, possibly) stated that Japanes banks will not lend to gaijin.

    Thus to invest it's a case of BYO funding, which offers no leverage and also exposes you to massive currency risk. I'm still trying to find a lender to finance me out of my current $A denominated unleveraged loans.
     
  6. NIF

    NIF Member

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    OK.

    Yes that is correct, my friends had to BYO money, hence currency exposure is a problem.
     
  7. Aceyducey

    Aceyducey Member

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    Try becoming a citizen or breaking into business circles there.

    Plus borrowing is very hard for foreigners.....need I add more :)

    if you have cash you can buy anything anywhere in the world. Investing IMHO is about NOT using your cash (using OPM) where possible.

    Cheers,

    Aceyducey
     
  8. marc1

    marc1 Member

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    Quiggles, I read with fascination your account, that besides being interesting from the investing point of view is very well written.
    I noticed you went only for blocks of flats. What is the market for single dwellings in "nice" suburbia middle class say Chicago for example...?
     
    Last edited: 10th Apr, 2005
  9. quiggles

    quiggles Member

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    Thanks for those kind words. I went for multiples because the returns were better and the prices not much different. I am currently in Buffalo. I'll be going though Chicago in a while, but unless I miss my guess, nice suburbs will have poorer cashflow. This is standard (and is the case in Buffalo which has some pretty nice areas), which is why most of my properties both in Australia and the US are blue collar.

    Cheers,

    Quiggles
     
  10. redwing

    redwing Progress Not Perfection

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    Westan

    Westan from PI seems to be doing well moving into the PI Scene in the US of A and has made some strong alliances there i believe..

    Dolf DeROOS is big on Las Vegas, have a look at his site...
     
  11. Kurra

    Kurra Member

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    Quiggles,
    Like every body else I was quite fascinated with your advanture in US.Well,I guess you have deserved every bit of that succes because that you worked hard for it.I have few questions:
    Since you have made your team back in US to act on your behalf, is it possible to recommend them to other investors as a point of contact or starting point?
    do you think that you get a better deal if you go there or it is better to do it through the agents who source the property on your behalf?
    What do you advice for an investor who decides to go to Buffalo to find property investments?
    how much is the property management there?
    do owners aloways have to pay for the utilities or it is optional?
    if we made an offer and inspection report came back quite poor ,and we decide to back off the deal ,how much do we have to pay as penalty?
    I know there is no stamp duty there,but is there any mortgage insurance if you seek finance?

    Regards,
    :confused:
     
  12. ggumpshots

    ggumpshots Member

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    JApan

    quiggles and Aceducey.....are both right

    Japan is an open market BUT
    not in the same way as you think of in the west.

    If you dont have an introduction ......well you can probably forget it in terms of business and investment.
    I couldnt even open a share trading account at Merril Lynch in Japan, but eventually found a broker elsewhwhere.
    You can borrow from a bank if you work here but you will generally be given the run around big time. Getting a credit card from a bank is a monumental task. I dont know of any forgeiners who have succeeded , though there may be one somewhere!
    Generally speakimg there are some big hurdles to jump as a forgeiner but its possible to be an investor. Of course my children arent allowed to have my family name.So many different rules apply to different people it is hard to know where the truth is sometimes. The problem is there seems to be more than one truth. So investing here might be pretty scary. I dont do it.
     
  13. brisbane 04

    brisbane 04 Member

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    Hi Quiggles,
    Could you please recommend an attourney in Buffalo and if possible his ph no. Thanks Martin :)
     
  14. thefirstbruce

    thefirstbruce -

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    Great info Q.
    I have lived and worked in Erie and Pittsburgh in Pennsylvania. Was last there in 2002, and looked at buying property, though was scared off for all the reasons you have overcome.

    I know Buffalo resonably well, and it had a reputation as one of many dying northern industrial cities. Detroit and Cleveland are others.

    Pittsburgh also had this reputation pre 2001, but there is an amazing renaissance ongoing, and the inner city area is being redeveloped. Its reliance on steel and tool and dye stuff has been replaced by IT and high tech industry.

    Erie is a city of ~200k about 80 mile west of Buffalo on the Southern shores of Lake Erie, hence it gets the lake effect snow too. I had looked at building a trailer park on a few acres, as there is reasonable demand for cheap rental accomodation. And knew a local who was helping me with all the details.

    However I went off the idea because the big employers in the area were laying off people left right and centre - GE and Hammermill (International Paper), and future prospects looked dim. Further, the ageing population were heading south to South Carolina and Atlanta, Georgia. The younger people were following because wages were so much better, along with opportunities.

    I see the wisdom in your high yield strategy, despite dubious capital gains. However, I am wondering whether you would be able to leverage off the properties you have in Buffalo, considering leverage is so important to wealth creation.

    You have reignited my interest in buying in the US. I had also sniffed around Las Vegas, but I asked a friend there 6 months ago what yields he was getting and they were only 9% gross. Though I understand capital gains are potentially much stronger, as the population is still increasing significantly.

    My feelings re US property is to stay out of the snow belts (extra ongoing maintenance) and get into the high growth southern states that are trying to attract business. Atlanta is one. It would be interesting to look at broadacre on the outskirts of the city to do a sub division, but that no doubt would be a vertical learning curve.

    Did you ever enquire via your lawyer or PM as to how squatting tenants are dealt with?
     
  15. thefirstbruce

    thefirstbruce -

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    PS Quiggles
    gee you like to do it tough though. I still wouldn't feel comfortable getting into a US town without living there for a few months, and getting local referrals to professionals, and some real local knowledge under my belt.

    Though I congratulate you on your pioneering spirit for pushing the boundaries of what can be accomplished electronically via the internet these days.
     
  16. Erin Jones

    Erin Jones Member

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    Q: Vacancy Factor: MVACTY??

    Hi Quiggles,

    Thanks for all the info. My friend Anthony Beake has been speaking to you - we are keen to get over there.

    In my internet searching I am finding this term a lot -
    Vacancy Factor:MVACTY - especially it seems on the bottom end (cheaper) properties. Do you know what it stands for?

    Thanks
    Erin :)
     
  17. quiggles

    quiggles Member

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    Sorry for the silence

    Dear all,

    I've been abroad for the last 2 months hence my silence and I'm busier than a 1 legged man in a bum kicking contest trying to tie down a couple of contracts at the moment. I promise I'll get back and answer questions shortly.

    Cheers, and it's nice to be back
     
  18. kissfan

    kissfan Member

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    Welcome back Quiggles.

    Hope all went well in the U.S.

    It's been a bit quieter here without your normal input.

    Regards
    Marty
     
  19. geoffw

    geoffw Untitled

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    I'm glad that "abroad" is one word and not two. Welcome back.
    Yes please.
     
  20. quiggles

    quiggles Member

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    More of a non-update, really

    Dear everyone,

    I'm still not fully back unfortunately. There are a huge number of issues to settle and matters have gotten kind of complicated. The market is hotting up in Buffalo - Australian accents were becoming more broadly recognised :D - and quite a few of our countrymen were in the market buying (you know who you are, and some of you to my certain knowledge got some pretty good deals).

    A few matters that I want to put down, however. After talking to them, I will not usually give out the names of my attorney, realtor, accountant etc. There are a number of reasons for this, and I apologise to any who may be offended, especially as this forum is for sharing knowledge. However, I have been woken at 2 a.m. all around the world with people asking me to do their work for them and as I have been at pains to point out, this is not a newbie's market. I also feel that I have done quite a bit of knowledge sharing on the topic.

    I have already described how I found my team and I suggest that you learn to fish, instead of asking me for precut salmon steaks, sliced to your specifications. It's in both of our interests that it happen that way. Likewise, I want my team focussed on my business, not on repeatedly answering questions many of which have their answers either in this thread or elsewhere on the net.

    I'm therefore stating that you need to take action yourselves and get to a certain stage before I'm willing to answer the same questions over again. It's very like the requirement that you search somersoft BEFORE asking a question.

    So, in answer to the outstanding questions: No, sorry, I won't provide my attorney's name. No, I don't know what MVACTY stands for - it's not a term I've seen before now.

    The outstanding question remains: have I found a good source of finance, and the answer remains: Not yet, for my needs and desires.

    Finally, to cap off the disappointments, I won't be able to describe this particular trip for a little time until some particular elements get bedded down.

    Maybe I will write that book after all. :)
     
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