Buying in the US

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

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  1. thefirstbruce

    thefirstbruce -

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    Q,

    you might be able to write that book tomorrow re yield.
    But as for CG, you might have to wait 25 years.

    The temperate zones of the USA, IMHO, will continue to decline, at the same rate China grows. Where do you think all those tool and die jobs went to????

    If anyone is looking for CG in the USA, try the warmer climes....particularly LV, Houston, and Atlanta Georgia.
     
  2. quiggles

    quiggles Member

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    I have said that CF is my only criterion. Not sure about CG, Vegas for instance has had huge increases but may be running out of steam (and water!)
     
  3. hkr

    hkr Member

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    even the yield might be bit questionable IMO with the large declining population in buffalo...after all you need to take vacancy into equation as well.
     
  4. Bricks & Mortar

    Bricks & Mortar Member

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    Hope all pans out favourably Bob
    Thanks for the inspirational tread!
    Enjoyed it emensily




    Timm
     
  5. quiggles

    quiggles Member

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    Obviously so did Steve McKnight! :D :D :D
     
  6. Les

    Les Member

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    G'day Quiggles,

    You lost me (and possibly others) with this:-

    Please elucidate.... Are you referring to someone's quote? Or something else? What am I missing?

    Regards,

    Les
     
  7. quiggles

    quiggles Member

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    Steve McKnight is reported (the Australian, 2/6/05, jpg of the article here ) as buying 30 homes in New York (there's a thread about it in the general forum).

    I was simply immodestly suggesting that he did this as a result of my post (which after all was cross posted to PI amongst other places). :D
     
  8. quiggles

    quiggles Member

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    Further reports from Buffalo.

    I'm still pretty strapped for time, so instead of the whole long bit, I'll be providing edited highlights. For reasons that will become obvious, I'm not telling the whole tale :) .

    I had arranged to get a list of hot prospects of properties from my realtor before we left, but we took our time in getting to Buffalo. This was because my travelling companions, Dr Quiggles and Rolling Thunder, don't travel well and Dr Quiggles has a chronic illness which regularly leads to exhaustion. So it wa two weeks later that we finally dropped in and got our first surprise - quite a few Australians that we had known about, and more that we hadn't, had bitten the bullet and gone to the US. Some of the properties they had bought were my best prospects, too. :mad:

    At that stage I had the ungenerous thought that it served me right for opening my big mouth. However, the obvious point came back to me that if I was willing to share only provided others didn't benefit, then my 'sharing' was not that at all. I was still disapointed, however.

    There had also been a side benefit from the stir in activity. Australians, as the most exotic investors, came in for the most comment, but it soon became apparent that there was a lot of New York City money and Californian money flowing in. All that cash was putting a floor under prices, letting vendors know that they could sell (stimulating supply) and increased the value of my existing properties. I could tell however that the quality of the remaining stock was getting picked over and that I might have to lower my sights in terms of acceptable rates of return and/or building quality.

    We spent four weeks in Buffalo, and worked our buns off, 7 days a week. Rolling Thunder had been enrolled in a school, which helped, and Dr Quiggles largely stayed healthy four the entire four weeks, which was pretty amazing.

    The end result has still not played out, especially as there were a number of complicating factors. Just to give you an idea of the problems you can face, we made an offer on one place, and a week later it was condemned!! Why? Because the landlord had a dispute with the tenants, wanted them out and took the drastic step of cutting off the utilities. He then reported HIS OWN property to the authorities as unfit for habitation on that basis :eek: and the cops moved the tenants out. We made it clear that our offer was inoperative until all utilities were back operating and the property was 'uncondemned'.

    I'd have to say that if anything the second trip was as big a learning curve as the first, because I was trying to do better and bigger in a harder environment. Worthwhile experience? Absolutely. Stressful? Very much.

    Some other observations: I have never met such friendly folk as the Yanks whose paths I crossed. They were unbelievably warm and open, and it made me wonder whether visiting Americans see Aussies as rather cold fish. Something to think about.

    Most of the locals reacted with unbelief to the concept of investing in real estate in their city. There are too many stories of big concepts which never get off the drawing board, urban renewal heroes who turned out to be criminal slumlords with no intention of renewing anything except their cashflow, budget blowouts likely to impact on property tax and the like. And that meant that some opportunities remained.

    Finance remains a hassle, which means that all who go there need to be well resourced and to tread warily.
     
  9. iKwak

    iKwak Minoring in RE

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    I did not have the chance to read all 8 pages in this thread but I have a question for the Australian citizens..

    If you decide that you want to invest in a residential IP in the US while you still reside in Australia, do you simply delegate the property management to a US firm?



    Edit: Found some great threads in the faq page http://www.somersoft.com/forums/showthread.php?t=18446
     
  10. quiggles

    quiggles Member

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    Yes. Just as you would if you lived in CA and bought in NY. It takes a particular kind of ..bravery.. to attempt to manage a property from over 100 miles away, never mind several thousand.
     
  11. MargMac

    MargMac Member

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    Thanks for sharing this info - its been great reading. I'm purchasing my first IP in the States at the moment and have lots of moments of self doubt so its been reassuring to read your experiences!

    An area I'm having trouble with at the moment is getting a decent building inspector - the ones I've spoken to so far have suggested more of a summary appraisal but I like the sound of your 60 page report - I'd rather know warts and all at this stage. Are you able to share who you have used for this or point me in the right direction?

    Thanks again for sharing your experiences.
     
  12. quiggles

    quiggles Member

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    This is going to sound mean, but it's meant for your own good.

    Do a websearch to find out who has a website. You'll need someone with internet savvy anyway. Then ask for their whole range of services. If you really can't find anyone in a week, let me know.
     
  13. Monopoly

    Monopoly Member

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    That's our quiggles, caregiver through and through!!! :p
     
  14. quiggles

    quiggles Member

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    But you know where I'm coming from, don't you, Jo?

    If you look at the last message I left in the linked thread in caveat emptor, I'm even stepping back from teaching people to fish in that particular stream until I'm reasonably sure that most can do it safely.

    Anyone with the ability to do their own research, build their own team and pursue their goals can certainly do nicely. And anyone seeking a prepackaged solution will get a shock - like I did 2 minutes ago. I'm supposed to close on a property in 2 hours and the vendor has just mentioned that the shared driveway advertised...isn't. And what's more, the neighbour who owns it has, since I was there, fenced it off!

    It's the wild west, there's still no solid finance in sight and if you can't swim, you'll sink. So I'm getting MargMac to put on the water wings. Would have been easier for me to give the name.
     
  15. Monopoly

    Monopoly Member

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    Yes I do quiggles, and it because of that that I have the utmost confidence that you would never give anyone (especially a novice) a bum (am I allowed to say that word here??) :eek: steer!!! ;)

    Amen!!! :rolleyes:

    I'm not looking to buy in the US atm, although I did indulge in a little retail therapy earlier this year, however, if I was to ever expand my horizons to across the waters and invest in some yankee soil, I know who I would approach for advice without hesitation!!! :D
     
  16. paull123

    paull123 Member

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    Hi Quiggles,
    for finance you might try Snyder Funding Inc. Williamsville NY 14221. They are a mortgage broker. They have a bank willing to lend up to 60% but as a rule want
    the property in your name first. It is easy to change to your LLC later.
    I tried with them before, but made the mistake of not getting my ITIN (Individual Tax Identifier) in time. So my name is mud there at the moment. Since you already got yours there should be no problems.
     
  17. quiggles

    quiggles Member

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    Thanks for that, Paull123.

    I now have all the properties in an LLC structure, so Snyder might not want to know. However, for others holding properties and unable to finance, it may work (one question - do you know of anyone who has gotten, as opposed to being promised, funding by these guys?).

    The IRS, for others reading, takes FOREVER to send out your ITIN, so learn by Paull123's example and don't have a mortgage closing date subject to the receipt of your number. It seriously took months to get mine. Get your number FIRST and then apply.
     
  18. paull123

    paull123 Member

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    Hello Quiggles,
    as far as any foreigner getting finance from Snyder Funding I don't know, however
    they had someone check my financial situation, employment and rental
    history in Australia so they definetely were serious about the loan.
    For those who are considering buying US properties there are two ways I know of
    getting your ITIN.

    One is to open a bank account. You will have to get an W-8 form from the bank
    That only allows the bank to whithold tax on interest. Once the finacial year has
    ended you can apply to the IRS for an ITIN because you have paid taxes.

    Second is to buy a US property outright. Before closing on the property can be
    done the buyer has to provide his social security number or in the case of the
    foreign buyer his ITIN. If the buyer does'nt have an ITIN he can apply to the
    IRS for one using an W-7 form and copy of the contract of sale as proof that
    he requires one. Along with the W-7 form and contract of sale the buyer needs
    to get an authenticated copy of his passport or some other type of ID. This
    can't be done by a solicitor but by a notary public who has been approved
    by the US consulate. You can get a list from the consulates web site.
    I hope this answers a few questions of newbies.
     
  19. quiggles

    quiggles Member

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    I applied for an ITIN directly with the IRS on the basis that I would be paying taxes (my LLC owned a property and I expected 1% of its net profits). I didn't actually have a bank account or property in my own name at the time.
     
  20. Corsa

    Corsa Member

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    Great post Quiggles

    Thanks for sharing your adventures and for having the courage to "go into the detail". Also for prioritising giving back to others and this forum, it truly is a wonderful display and testament to your character.

    Well done and thanks again

    Corsa
     
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