Author: Premela R.

Secrets Banks Won’t Tell You (Real Estate Bridging Loans)

Post author By Premela R.
Post date June 14, 2024

Real Estate Bridging Loans | US Home Loan

Looking to access liquidity quickly and easily from your U.S. real estate? AM bridge loans can help! Bridge loans are short-term loans that help cover immediate financial needs until longer-term financing is secured. This is excellent for non-resident investors and U.S. expats who need quick access to liquidity.

What is a Bridge Loan?

Bridge loans provide fast approval and flexible repayment terms, allowing investors to act on opportunities quickly for a purchase or release equity from a property when “conventional” bank options are not available or are not practical. There are a variety of reasons sophisticated real estate investors use bridge funding – it can be used to purchase a new property while selling an existing property, fund renovations on a property before renting it out, or obtain almost immediate access to liquidity tied up in real estate for higher return investments.

As reported by CoreLogic, in Q1 2024, the total home equity for U.S. mortgage holders exceeded $17 trillion, nearing the previous record set in 2023. The increase in home values and equity growth suggests many homeowners have significant potential capital. AM Bridge loans allow foreign nationals and U.S. expat investors to leverage their existing equity to finance short-term needs or seize investment opportunities.

Map Bridge loans | Residential Bridge Loan

How Can Bridge Loans Help?

Bridge loans can be a vital tool for non-resident U.S. investors and U.S. expat investors. Unlike conventional mortgage loans, bridge loans can be structured to the exact needs of the borrower. Often with high LTV, no monthly debt servicing, and quick closing times – often as short as one week. Bridge loans can provide the needed capital to:

Facilitate Property Purchases: Investors can secure properties quickly without waiting for the sale of another asset.

Avoid Foreclosure: Quick access to funds can prevent the loss of property due to foreclosure.

Expand Business Ventures: Investors can use the equity from high-value properties to invest in other business opportunities.

America Mortgages Case Studies:

Canadian Businessman Leverages $10M California Property to Expand Business

A Canadian businessman owned a $10 million property in California. To expand his business, he pulled out 65% of the LTV from his property, amounting to a $6.5 million loan. With an interest rate of 10% over a 12-month term, this bridge loan provided the necessary liquidity to invest in his business without selling the property.

Bridge Loan Helps U.S. Expat Avoid Foreclosure

Bridge Loan Helps U.S. Expat | Loan For Foreign Property

Facing foreclosure, a U.S. expat property owner sought help from America Mortgages. We helped to secure a $500,000 bridge loan at a 70% LTV and 12% interest over 18 months. This quick access to funds eased his financial strain, preventing foreclosure and protecting his investment by paying off the existing lender and structuring the loan so that he did not have to make monthly payments for 6 months. This allowed the client to relax, reset, and focus on getting back on track.

What is Needed to Qualify?

Equity: Qualifying for a bridge loan is primarily based on the existing equity in the owned property. Bridge loans will typically allow for up to 70% of the current value of the existing property. If there is an existing mortgage, it will need to be paid off through the transaction.

Income: Normally, there are no income requirements for these types of loans. However, the borrower should be able to either service the monthly payments or have sufficient equity to “roll up” or pay any interest payments due upfront out of the loan proceeds.

Credit: No U.S. credit is required

Eligible Loan Types: Purchase, refinance, and cash-out refinance
Term Lengths: 12-24 months
No U.S. Credit Required
Loan Amounts: US$100,000 to US$100m
Payment Options: Monthly, interest-only, interest rolled up, no prepayment penalty
Purchase Loan-to-Value (LTV): Up to 75%
Refinance Loan-to-Value (LTV): Up to 70%
Cash-out Refinance Loan-to-Value (LTV): Up to 65%
Property Types: Single-family, multi-family (5+ units), duplexes, triplexes, quadplexes, condominiums, townhomes, commercial, industrial

America Mortgages offers bridge loans designed to bridge that gap for non-resident U.S. investors and U.S. expats. Our fast approvals and flexible terms empower investors to access liquidity quickly, whether buying, renovating, or avoiding foreclosure. With substantial home equity available, our bridge loans help leverage existing assets for short-term needs and investments. Trust America Mortgages to support your U.S. real estate goals with tailored solutions that ensure confidence and success.

Schedule a meeting with one of our loan officers using our 24/7 calendar link. Contact us today at [email protected] to start your investment journey!

Your Exclusive Access to U.S. Real Estate Opportunities

Post author By Premela R.
Post date June 7, 2024

The U.S. housing market’s ongoing resilience and potential present unique opportunities for foreign nationals and U.S. expats. According to CoreLogic’s June 2024 Home Price Insights report, it is projected that U.S. home prices will increase by 4.6% over the next year, indicating the market’s stable growth. With projected home price increases, robust support for navigating currency risks, and a streamlined remote mortgage process, now is an ideal time to invest.

Why Now Is a Great Time to Invest

Despite higher interest rates, the U.S. housing market remains resilient. Experienced investors understand that waiting for lower rates may mean missing potential appreciation gains. The present market circumstances indicate that it’s a strategic moment to invest, as home prices are projected to keep rising. By acquiring properties now, investors can benefit from both rental income and long-term capital appreciation.

U.S. Home price scenarios | America Home Mortgage

Navigating Currency Exchange Risks

One primary concern for global investors is currency exchange risk. Through our trusted partners, America Mortgages offers customized options to minimize these risks, allowing foreign investors to oversee their investments effectively. Through the use of hedging techniques and collaboration with financial professionals, investors are able to safeguard their profits from negative currency changes.

Seamless Mortgage Process from Abroad

America Mortgages offers a remarkable feature that allows the entire mortgage process to be completed remotely. This convenience is particularly beneficial for expats and non-resident investors who may not have the opportunity to travel frequently. This ensures a stress-free experience for international investors.

As the U.S. housing market continues to thrive, investors can utilize America Mortgages’ Investor + Program, designed specifically for foreign nationals and U.S. expats looking to capitalize on these opportunities.

Loan Highlights:

Competitive Interest Rates: Based on Loan-to-Value (LTV), America Mortgages offers the best potential market rate available
High LTV Ratios: Up to 75% LTV based on the cash flow of the property and NOT your personal income
Flexible Loan Amounts: Minimum loan amount of $100,000 with no maximum cap
Extended Loan Terms: Up to 30 years, providing lower monthly payments with an option for a 10-year fixed Interest-Only structure
No U.S. Credit History Required: Credit report from your home country or country of residence instead of U.S. credit. If that isn’t available, we have alternative options for establishing credit
Remote Application Process: Complete the entire mortgage application and approval process from anywhere in the world. Open and close your transaction without travelling to the U.S.

Tax Advantages and Upcoming Webinar

Investing in U.S. real estate offers numerous tax advantages for foreign investors that many may not be aware of, including deductions on mortgage interest, property taxes, and depreciation. These benefits can significantly improve investors’ overall investment return. To provide more in-depth insights, America Mortgages will be hosting a webinar on “3 Tax-Smart Strategies for U.S. Real Estate Investing” on June 13th at 6:30 PM SGT. Join us as we explore how strategic tax planning can enhance rental income for overseas investors and gain valuable insights into U.S. tax strategies that reduce liabilities and boost cash flow.

The U.S. housing market offers opportunities for foreign nationals and U.S. expats. With projected home price increases, support for navigating currency risks, high leverage, and creative yield-optimizing mortgage options, now is the time to invest.

America Mortgages is here to provide expertise and support for your investment journey. Explore your U.S. mortgage options and schedule a meeting with one of our loan officers using our 24/7 calendar link. Contact us today at [email protected] to start your investment journey!

U.S. Multifamily Real Estate Mortgage Loans Are Now Available to Non-U.S. Residents!!

Post author By Premela R.
Post date May 31, 2024

As savvy investors already know, U.S. real estate investment has long been considered a fantastic opportunity for building wealth and ensuring financial stability. Until this week financing for foreign nationals and U.S. expats has been mainly limited to 1-4 unit properties. America Mortgages is proud to announce that we have made these mortgage loans available to all our clients regardless of their residency or passport!

“These types of properties present another opportunity for U.S. expats and foreign national investors seeking to invest in U.S. real estate, and America Mortgages is thrilled to introduce our newest mortgage program, AM MultiUnit+, designed specifically for non-resident investors looking to acquire 5-8 units,” states Nick Worthing, Vice President of Residential Lending.

In this article, we explore why multifamily homes stand out as an excellent investment opportunity.

Why Invest in Multifamily Homes?

Steady Cash Flow: Multifamily properties provide several rental income sources from each unit, making sure that investors have a steady and reliable cash flow. This reduces the risk of losing all rental income in the event that one unit is vacant, unlike single-family homes where vacancy results in a complete loss of rental income.

Cost-Effectiveness: Managing multiple units within a single property is often more efficient and cost-effective than managing multiple single-family homes spread across different locations. Consolidating expenses such as maintenance, property management, and renovations can lead to lower per-unit costs and an increase in profitability.

Appreciation and Value: Multifamily properties typically appreciate in value over time due to the increasing demand for rental housing and strategic property improvements. Investors can boost their property’s value through renovations, leading to significant long-term capital gains.

Matrix Monthly YOY Chart | International Home Loans — Year-over-year multifamily rent growth, all asset classes. *Yardi Matrix*

Types of Multifamily Homes

There are various kinds of multifamily homes to consider, each offering different layouts and living spaces.

Apartments: Apartments are owned by a single entity and rented out to residents. They offer a range of affordability, from budget-friendly options to upscale and luxurious living. Some apartments have amenities like community pools, theatres, exercise facilities, gardens, or game rooms catering to various lifestyle preferences and budgets.

Condominiums: Condominium ownership is divided by each unit, with buyers sharing ownership of communal spaces. These units are designed to appeal to specific buyer markets, such as working professionals or seniors. Condominium communities offer the benefits of homeownership along with amenities and low-maintenance living, making them an attractive option for many.

Mixed-Use Developments: Mixed-use developments combine residential units with commercial, retail, entertainment, or cultural spaces. These developments offer residents convenience, with everything from grocery stores to public transit stations within close proximity. Living in a mixed-use development provides a blend of urban living and access to various amenities.

Student Housing: Modern student housing goes beyond basic dorms, offering luxurious amenities and contemporary designs. These spaces are located near university campuses and cater to the lifestyle preferences of today’s students. Many student housing developments feature amenities like spas, game rooms, and fitness centers, enhancing the overall living experience for residents.

Age-Restricted Communities: These neighborhoods are typically limited to residents aged 55 and older, focusing on social engagement and lifestyle amenities. Lifestyle directors, fitness classes, and social clubs are common features, providing ample opportunities for residents to stay active and engaged. Age-restricted communities offer a sense of community and camaraderie for those in the same stage of life.

Low-Income Housing: Government programs aim to make housing affordable for low-income families and individuals. Subsidized housing options are integrated into multifamily developments, providing essential support for millions of households. These units are often indistinguishable from market-rate units, offering affordable housing options without compromising on quality.

Benefits of Owning Multifamily Homes

Diversified Risk: Owning a multifamily property spreads the risk across several units. If one tenant moves out, the loss of income is less impactful compared to a single-family rental. This diversification makes multifamily homes a more stable and secure investment.

Scalability: Multifamily properties provide an excellent opportunity for investors to quickly expand their real estate portfolio. By acquiring a multifamily property, investors can increase their rental units and income potential without the need to purchase multiple single-family homes.

Community and Management: Multifamily properties often creates a sense of community among tenants, leading to higher tenant retention rates. As an investor, managing multiple units in one location simplifies property management tasks, making it easier to maintain the property and address tenant needs promptly.

AM MultiUnit+ Loan Program

At America Mortgages, we provide mortgage solutions for U.S. expats and foreign national investors. AM MultiUnit+ is designed to make the process seamless and accessible, especially for non-residents and U.S. expat investors.

Loan Highlights:

5-8 units
Minimum loan amount: US$250,000
Loan-to-Value: up to 75% for purchase & 70% for cash-out
Underwritten on Property cash flow
No U.S. credit required
No personal income required

Our seasoned mortgage advisors specialize in navigating the complexities of securing financing for multifamily properties. With personalized guidance from pre-qualification to closing, we ensure a seamless and hassle-free experience every step of the way.

Experience the simplicity of our streamlined approval process, specifically designed to meet the unique needs of foreign national investors. We consider factors such as projected rental income, making it easier than ever for investors to qualify for a mortgage.

With nationwide availability across all 50 states, you can confidently invest in the best markets for multifamily properties, whether bustling urban centers or high-growth suburban areas. Let America Mortgages be your partner in unlocking the potential of your multifamily investment journey!

For more information, visit www.americamortgages.com or contact us at [email protected].

LLC and Tax Strategies for U.S. Real Estate Investors

Post author By Premela R.
Post date May 24, 2024

What is an LLC or Limited Liability Company

Investing in U.S. real estate can be an amazing opportunity for non-U.S. residents, offering opportunities for substantial yields, capital appreciation, stability and portfolio diversification. However, navigating the complexities of the U.S. tax system and legal environment requires expert advice, and America Mortgages, besides being your mortgage partner, is there with you at every step of the process. One of the most common and effective strategies for foreign national investorsis to use a U.S. Limited Liability Company (LLC) combined with smart and logical tax planning. Here’s why;

1. Liability Protection

An LLC offers liability protection, meaning that investors are typically not personally responsible for the debts and liabilities of the company. This is crucial for foreign investors who may not be familiar with U.S. litigation risks. Should any legal issues arise, the LLC structure can help shield personal assets from lawsuits or creditors.

2. Flexible Tax Treatment

LLCs provide flexible tax options. By default, a single-member LLC is treated as a disregarded entity for tax purposes, meaning income is reported on the investor’s personal tax return. Multi-member LLCs are treated as partnerships. However, an LLC can also elect to be taxed as a corporation. This flexibility allows foreign investors to choose the tax treatment that best suits their financial situation and goals.

3. Simplified Estate Planning

Every investor should be aware of U.S. estate tax laws, especially in the event of the property owner’s death. By holding property through an LLC, foreign investors can structure ownership in a way that may mitigate these estate tax implications. For example, ownership interests in the LLC can be transferred more easily than direct ownership of property, simplifying estate planning and succession.

5. Operational Efficiency

Owning U.S. real estate through an LLC can simplify the daily operations, especially if the LLC holds multiple properties. This centralization can streamline property management, accounting, and tax filing processes, making owning and managing real estate from abroad as easy as owning it in their home country (maybe even easier).

6. Proper Tax Planning

While an LLC offers numerous benefits, proper tax planning is essential to maximize those benefits and ensure compliance with U.S. tax laws. America Mortgages works with professionals who understand the complexities of foreign-owned or U.S. expat-owned real estate. Here are key considerations for foreign investors:

7. Understanding U.S. Tax Obligations

The U.S. tax filings are not as complicated as many people believe. It is important that foreign national investors understand their U.S. tax obligations, including federal, state, and local taxes. Engaging a tax professional experienced in international taxation can help navigate these obligations and identify opportunities for tax savings.

8. Utilizing Tax Treaties

The U.S. has tax treaties with many countries that can provide benefits such as reduced withholding rates on dividends, interest, and other income. Investors should review applicable treaties and incorporate them into their tax planning strategy.

9. Structuring Investments

Proper structuring can minimize tax liabilities. For example, layering LLCs or using a combination of LLCs and other entities, like corporations or trusts, can provide tax advantages and additional asset protection.

10. Consulting with Experts

Given the complexity of U.S. tax laws, consulting with legal and tax professionals who specialize in real estate and international taxation is essential. They can provide tailored advice, ensuring compliance and optimizing the investment’s tax efficiency.

In conclusion

For foreign nationals, investing in U.S. real estate through an LLC offers significant advantages, including liability protection, flexible tax options, and simplified estate planning. However, these benefits can only be fully realized through careful tax planning and compliance with U.S. tax laws. By leveraging the expertise of professionals and utilizing strategic planning, foreign investors can navigate the complexities of the U.S. real estate market effectively and achieve their investment goals.

Want to learn more?

We are excited to invite you to our month-long webinar series, offering a wealth of information on U.S. real estate investment.

First, join us for an informative session on Why and How to use an LLC for U.S. Real Estate Investing. Discover the benefits of forming an LLC for overseas property investment, including legal protection, asset security, tax advantages and cost of set-up.

Webinar: Why and How to Use an LLC for U.S. Real Estate Investing

Date and Time: June 7, 2024, 07:30 AM SGT
Registration Link: Register here

Next, don’t miss our session on “3 Tax-Smart Strategies for U.S. Real Estate Investing” Learn how strategic tax planning can enhance rental income for overseas investors, offering insights into U.S. tax strategies that reduce liabilities and boost cash flow.

Webinar: 3 Tax-Smart Strategies for U.S. Real Estate Investing

Date and Time: June 13, 2024, 6:30 PM SGT
Registration Link: Register here

Get ready to elevate your investment game! We can’t wait to see you there.

Why Foreign Real Estate Investors Choose the U.S.

Post author By Premela R.
Post date May 17, 2024

America Mortgage - Foreign Mortgage Loan

Why are foreign real estate investors choosing the U.S. over every other country in the world? Is it the world’s largest real estate market, with over $2.3 trillion transacted last year alone? Perhaps the staggering $53 Billion of U.S. residential homes purchased by foreign nationals in 2023? Maybe they are following Blackstone’s playbook as they also purchased more than $6 Billion in single-family homes across the U.S. My guess is it’s a combination of everything amongst the standard appeal of high returns, diversification, and a stable environment. Let’s dig into the reasons behind this intriguing trend and uncover the answers.

Huge Market Potential

There is a wide range of investment opportunities, including commercial and residential properties and real estate investment trusts (REITs). Foreign investors are motivated by a variety of factors when investing in U.S. real estate. These include the potential for high returns, diversification of their investment portfolio, and the stability and security of the U.S. political and economic environment. Let’s take a look at why these facts attract foreign investors to residential real estate in the U.S.

Capital Appreciation and Cash Flow

The benefits of investing in U.S. real estate are often undervalued. You can make money by renting out your property, and over time, your property’s value can increase. Even though home values have had their ups and downs, here’s the bottom line: in the last 20 years, the average home price in the U.S. has gone up from roughly $140,000 to around $340,000 as of April 2023. So, when you combine rental income and property value appreciation, foreign investors have the chance to see a solid return on their investment.

Diversification

The most important concept in investing is diversification, which helps reduce risk and increase returns over time. Investing in U.S. real estate can help foreign national investors diversify their real estate investment portfolios by spreading their investments across different countries. By reducing risk and increasing returns through diversification, non-resident investors can achieve their investment goals more effectively.

Secure and Stable Investment

The stability of the U.S. political and economic environment makes it an attractive destination for foreign investors seeking security. This is further enhanced by its legal framework and property rights protection. These protections include the right to own, use, and dispose of property and the right to exclude others from the property.

Tax Benefits

Certain tax advantages exist when investing in U.S. real estate, such as deductions for mortgage interest payments and property taxes. However, tax regulations can be complex, so it is important to consult with tax professionals to ensure that foreign investors take advantage of all available tax benefits. Consulting with tax professionals can help foreign investors gain clarity on tax regulations and ensure that they are making informed investment decisions.

No Stamp Duty

The U.S. is one of the few countries that does not have stamp duty for both foreign and U.S. citizen investors. This factor can potentially save you tens of thousands of dollars when compared to markets such as the U.K. or Australia.

Factors to Consider When Buying Real Estate

Regardless of the market, as most people are aware when making investment decisions, it is important to consider personal goals and risk tolerance. With real estate, each property presents a unique set of variables. Here are some important factors to consider:

Market Trends: Research current and historical market trends in the area of investment property. Understanding supply and demand dynamics, price trends, and rental market conditions can help make informed decisions.

Location: Location, Location, Location. It’s often considered the most crucial factor in real estate investing. A desirable location can lead to higher property values, rental income, and demand. Consider factors like proximity to schools, workplaces, amenities, and the overall neighborhood’s reputation.

Budget and Financing: Determine the budget for the investment, including purchase price, property taxes, and ongoing expenses. Explore America Mortgages’ financing options, such as LTV and qualifying criteria.

Property Type: Decide whether to invest in single-family, multi-family, condos, townhomes, or apartment buildings. Each property type has its own set of considerations and advantages.

Mortgage Type: The most popular loan program allows the borrower to qualify based on the cash flow of the property, not personal income.

Property Condition: Assess the condition of the property. Renovations and repairs can significantly impact investment costs and potential returns.

Cash Flow: Calculate the potential rental income and expenses associated with the property. Ensure that the property’s rental income covers all costs and leaves room for a positive cash flow.

Property Management: Decide whether the property will be directly managed by you or by a property management company. Explore property management companies that allow you to live and work abroad from where the property is located, stress and hassle-free.

Ready to Make a Move?

Investing in the largest and most stable real estate can provide foreign investors with a wide range of benefits, including high returns, diversification of their investment portfolio, and the stability and security of the U.S. political and economic environment. By generating cash flow through rental income and capital appreciation, foreign investors can achieve their investment goals more effectively. America Mortgages has one focus: providing market-rate mortgages for non-U.S. citizens, foreign nationals, and U.S. expats. This is 100% of our clients; no one does it better. If you’d like to find out more, please register to speak with one of our U.S. mortgage specialists today.

www.americamortgages.com

Feds Have Paused Interest Rates, What Does This Mean to You as an Investor?

Post author By Premela R.
Post date May 10, 2024

The Federal Reserve raised rates 11 times in 2022 and 2023 but are now hitting pause. The decision comes as inflation has risen. The Fed is holding steady, waiting for inflation to ease closer to the target before making any changes.

The Federal Reserve’s decisions have a significant impact on the housing market. When they adjust interest rates, it directly influences mortgage rates. At the same time, the recent hikes in interest rates were aimed at cooling down the economy after the COVID-19 pandemic.

While higher rates can pose initial challenges for homebuyers, it’s worth noting that mortgage rates have seen a slight decrease from their peak of 8% last fall. As of May 1, the average 30-year rate was 7.39%, according to a survey by Bankrate. This downward trend indicates a positive shift in the market, providing some relief for buyers and sellers alike.

The current market conditions present numerous opportunities. Despite the slowdown in home sales, prices remain stable, with the nationwide median existing-home price almost reaching $400,000 in March.

Savvy investors will understand that purchasing U.S. real estate now means avoiding the buying frenzy and escalating property prices that often accompany decreased interest rates. Additionally, if the Fed decides to reduce rates, you can always refinance later.

U.S. Home Price Growth — Zillow’s expert panel expects home prices will grow at a steady pace in 2024.

Savvy Real Estate Investors Use This Program

Most savvy real estate investors will take advantage of interest-only loans. Interest-only loans increase cash flow and cash-on-cash returns. The first impact that an interest-only period can have on a real estate deal is that it can increase cash flow on the project and cash-on-cash returns as a result.

Improved Cash Flow: Interest-only loans result in lower initial repayments, which can free up cash flow for other investments, property upgrades, or unforeseen expenses.
Tax Efficiency: For investment properties, loan interest can often be claimed as a tax deduction. This means the larger interest payments in an interest-only loan may provide significant tax advantages.
Strategic Investing: With the flexibility of lower initial repayments, savvy investors may be able to diversify their portfolio or strategically invest in higher yield opportunities.

America Mortgages has one of the best interest-only mortgage options in the market! Think about this – a FIXED 10-year interest-only product that converts to a 30-year fixed at the end of 10-years with no adjustment in rate. The only difference is that the loan now becomes a principal and interest payment. This loan is available to all clients regardless of their age. You have the certainty of knowing exactly what your mortgage payments are for 40-years. If interest rates go down, refinance into another 10-year program. It’s that simple.

At America Mortgages, we recognize the complexities of the U.S. housing market. That’s why we’re here to provide expert guidance. Whether you’re a foreign national investor or a U.S. expat, our team can assist you in finding the right mortgage for your needs. Offering up to 75% LTV in all 50 U.S. states for Foreign Nationals and 80% for U.S. expats, America Mortgages is your trusted source for dependable, flexible, market-rate U.S. mortgage loans.

For any questions or personalized assistance, our committed team at America Mortgages is here to support you along your real estate investment journey. Reach out to us at [email protected]. If you’d like to schedule a no-obligation meeting with one of our U.S. loan officers to explore your U.S. mortgage options, use our 24/7 calendar link. Don’t wait; take the next step towards owning your investment home in the U.S. by contacting us today!

www.americamortgages.com

The Top 5! Which 5 foreign buyers are buying which 5 U.S. states?

Post author By Premela R.
Post date May 3, 2024

Top 5 Foreign Buyers of U.S. Residential Real Estate*

China 13% of total = $13.6B
Mexico 11% of total = $4.2B
Canada 10% of total = $6.6B
India 7% of total = $3.4B
Colombia 3% of total = $900M

Top 5 States for Foreign Buyers*

Florida 23%
California 12%
Texas 12%
North Carolina 4%
Arizona 4%

US$53.3 billion*
The total value of foreign buyers of U.S. real estate

$639,900*
The average purchase price by a foreign buyer

*National Association of Realtors, year ending March 2023

Contents:

Average purchase price of top 5 foreign buyers
Top 5 states buyers from China, Mexico, Canada, India and Colombia are choosing, respectively
Top 5 origin of foreign buyers in Florida, California, Texas, North Carolina and Arizona, respectively
What surprised us from our research!

TOP 5 FOREIGN BUYER ANALYSIS

Asian buyers continue to lead the charge as the largest group of buyers, with a 38% market share. Going forward, we expect to see increased demand from SE Asia as growth in this region continues to exceed expectations.

LATAM was the runner-up with a 31% share of total foreign buyers, not far behind China. We are very excited about the growth outlook for LATAM as the reshoring of manufacturing to The Americas, and the growth outlook improves. One interesting point is that Colombia replaced the United Kingdom as the 5th largest international buyer, proving the growth of LATAM at the moment. We have recently set up an office in Panama and are looking to rapidly expand our footprint here.

European buyers accounted for 14% of foreign buyers, while Canadian buyers alone accounted for 10%.

Chinese buyers continue to have the highest average purchase price at $1.2 million, as buyers purchased in expensive states: 33% of Chinese buyers purchased a property in California, and 6% purchased in New York. This makes sense since California and New York have better-known schools, and a big driver in this decision is education. See our Deep Dive on The Best U.S. High Schools.

Watch Now: Irvine, California – Why is it the most popular destination for Asian homebuyers over the past 10 years?

Mexican buyers typically purchased the least expensive properties, with Texas as the preferred destination. This can be explained by the geographic proximity.

Average purchase prices for Foreign Buyers

China $1.2M
Mexico $449K
Canada $779K
India $577
Colombia $355K

Buyers from China – Top 5 Destinations

California 33%
Florida 16%
Texas 8%
Colorado 6%
New York 6%

Buyers from Mexico – Top 5 Destinations

Texas 48%
California 18%
Ohio 6%
Arizona 4%
Florida 4%

Buyers from Canada – Top 5 Destinations

Florida 55%
Arizona 14%
California 4%
Louisiana 4%
Montana 4%

Buyers from India – Top 5 Destinations

California 20%
Pennsylvania 14%
Texas 11%
Alaska 9%
Illinois 9%

Buyers from Colombia – Top 3 Destinations

Florida 80%
California 13%
Illinois 7%

TOP 5 DESTINATION ANALYSIS FOR FOREIGN BUYERS

Florida is the top destination for foreign buyers with 23% market share, mostly coming from LATAM 46%, Canada 24%, Europe 16% and Asia 14%. Florida has the best combination of vacation home, investment property and also luxury homes.

California has the 2nd largest market share of foreign buyers at 12%, mostly coming from Asia. Direct flights, temperate weather, and well-known universities make it an obvious destination for Asian buyers. See our California Report.

Texas was the 3rd top foreign buyer destination, with a 12% market share. Texas is one of our top 3 choices for pure real estate investments. The zero-state tax rate will always generate an incoming population from gentrification and also companies setting up their headquarters. For example, Dallas is the headquarters for the Fortune 500 companies in the world!

North Carolina was the biggest surprise to me as the 4th-highest destination for foreign buyers. One of the prettiest and underappreciated states, North Carolina, deserves more research on what is driving the interest of foreign buyers. We will keep you posted.

Arizona has always been a popular destination for foreign buyers and is the 5th-most popular destination, with 4% of all foreign buyers.

Share of Top 5 State to Total Foreign Home Buyer Purchases

Florida 23%
California 12%
Texas 12%
North Carolina 4%
Arizona 4%

Florida – Origin of Foreign Buyers

LATAM/Caribbean 46%
Canada 24%
Europe 16%
Asia/Oceania 14%

California – Origin of Foreign Buyers

Asia/Oceania 61%
LATAM/Caribbean 22%
Europe 7%
Africa 7%
Canada 3%

Texas – Origin of Foreign Buyers

LATAM/Caribbean 55%
Asia/Oceania 25%
Europe 11%
Africa 5%
Canada 4%

North Carolina – Origin of Foreign Buyers

Asia/Oceania 50%
Europe 22%
LATAM/Caribbean 22%
Canada 6%

Arizona – Origin of Foreign Buyers

Canada 37%
Africa 26%
Asia/Oceania 16%
Europe 11%
LATAM/Caribbean 11%

What surprised us from our research?

The average price for a Chinese buyer is $1.2M
North Carolina, the 4th most popular state for foreign buyers
Asians are the largest foreign buyers of North Carolina real estate
Indian buyers prefer Pennsylvania as their 2nd most favorite state
Canadians are the largest foreign buyers in Arizona
Africa, the 2nd largest foreign buyer of Arizona real estate

Our analysis reveals fascinating trends in the U.S. residential real estate market driven by foreign buyers. While China remains a major player, Asian buyers take the lead overall. Florida stands out as the top destination, but California, Texas, and even a surprising North Carolina, all attract significant foreign investment. The data highlights the diverse motivations behind these purchases, with factors like education, investment potential, and proximity influencing location choices.

Ready to explore your U.S. real estate opportunities? Contact us today at [email protected] or schedule a call with our loan officers and schedule a commitment-free meeting with one of our U.S. loan officers to explore your U.S. mortgage options further, you can do so using our 24/7 calendar link. Our team can help you navigate the intricacies of financing your U.S. investment property.

Turn your home equity into cash (globally)!

Post author By Premela R.
Post date April 26, 2024

Need cash fast? Tap into your home equity today!

U.S. homeowners are the most “equity-rich” they have ever been, thanks to their home equity increasing over 32.2% since 1Q2021. That’s a year-over-year gain of over $3.8 trillion for the entire housing market.

This significant increase in home equity has provided many homeowners with the opportunities to cash in through home equity loans and cash-out refinancing!

Article Contents:

Why is home equity important?
How to access your home equity?
Common use of funds
Global bridging loans

Why is Home Equity Important?

Home equity is an excellent long-term wealth-building strategy. To demonstrate just how true this is, let’s compare an auto loan to a mortgage. When you take out an auto loan, you are paying interest on an asset that depreciates in value as soon as you drive it off the lot. That means that when you’ve paid off the loan, the car will most likely be worth less than your purchase price, and you will have paid interest.

In contrast, mortgage payments reduce your debt while your home increases in value. Of course, property values could drop, but that is unlikely to happen over the long term. One very financially powerful aspect of this is that you don’t need to sell your home to profit from it.

How to Access Home Equity

Equity-rich homeowners have two options for accessing their equity without selling their homes:

1. Home Equity Loan: Think of this as taking out a second mortgage for a fixed rate that must be repaid within a set period.

2. Cash-Out Refinance: This option is excellent when you’ve seen an increase in the value of your property. If you’ve just recently purchased a property, you’ll need to wait for at least 6-12 months to use the new value.

The best way to cash in on your equity depends on your goals. For example, releasing equity is a well-known way to acquire more real estate and build a portfolio.

Common Use of Funds (to name a few)

Refinancing
Renovations
College tuition
Pay off high-interest debt
Personal business needs
Purchasing more property (BRRRR method)
Cash while waiting for sale
Down-payments
Other investments

Global Bridging Loans

Bridging loans are short-term loans, normally 1-2 years, which are used to “bridge” a funding gap where banks are unable to meet the borrowers requirements, usually – speed of funding, loan to value and certainty.

Bridging loans are based on the collateral value of the property (asset-backed) and not the borrower’s personal financials. Loans are normally “interest-only or interest-servicing only” with a bullet repayment at the end of the terms. These loans have been very popular over the past few years as retail banks have significantly reduced their willingness to lend on property (globally), and private loans (private credit) have filled the gap.

Countries We Offer Bridge Financing in:

USA
Canada
UK
Australia
Singapore
Hong Kong
Philippines
Thailand

Basic Details

Get approved in 24 hours and funding in as fast as 7 days
Up to 70% of your home’s value
Available for primary homes, second homes, and investment properties
Priority is speed of funding, certainty, and high loan-to-value
Short-term and not meant to replace a bank loan
No age restriction in many countries

With our fast approval process, flexible terms, and international reach, we’re here to support your financial needs. Reach out to our International Loan Officers today, and let’s turn your home equity into cash for whatever you need. Get started now!

www.americamortgages.com

Q&A: U.S. Housing Market Masterclass – Strategies for Rate Reductions & Market Outlook

Post author By Premela R.
Post date April 17, 2024

During our latest webinar, “U.S. Housing Market Masterclass – Strategies for Rate Reductions & Market Outlook,” hosted by America Mortgages’ CEO Robert Chadwick (RC) and co-founder of global mortgage group, Donald Klip (DK), attendees gained valuable insights into navigating the U.S. property market and optimizing financing opportunities. For those who couldn’t attend, the recording is now accessible here.

Robert Chadwick and Donald Klip addressed a range of inquiries, providing insightful responses tailored to assist investors in making informed decisions, with remarks edited for clarity and brevity.

Q: Should I wait until interest rates get lower or buy now?

DK: Don’t wait for rates to drop. Even if they do, property prices are likely to rise. As we like to say, “marry the property and you date the rate.” It’s better to buy now and consider refinancing later if needed.

RC: Exactly. In the current market, it’s wise to act now rather than wait for rates to decrease. As investors with diverse portfolios are already seizing opportunities, it’s crucial to secure your property before prices surge further. Remember, you marry the property and you date the rate.

Q: In your opinion, which areas are great for buying now?

DK: The answer depends on your investment goals and preferences. Detroit, for example, offers high rental yields, while southern states like Texas and Georgia have relatively lower property prices.

Q: Any risks of waiting for rates to drop?

RC: The main risk is potentially paying a higher price for a property due to increased competition when rates eventually drop. It’s crucial to weigh this risk against potential savings on interest.

Q: Are there age restrictions for retirees applying for a mortgage?

DK: The U.S. generally doesn’t have age restrictions for retirees applying for mortgages. Lenders focus more on income, credit history, and property value.

Q: What are the four different ways of closing on the property?

DK: Closing methods vary but may include visiting the U.S. embassy, using remote online notaries, arranging power of attorney, or physically signing in the U.S..

Q: Does being an expat without a W2 affect mortgage rates & terms?

DK: Expats without W2s can still qualify for mortgages, as we assess their eligibility based on other factors like income sources and creditworthiness.

Q: What’s the maximum LTV for foreign investors? Is it income dependent?

DK: The maximum loan-to-value (LTV) ratio is typically 75% for foreign investors, and it’s generally not solely income-dependent, as rental income can also be considered.

Q: How can I qualify to purchase a property for my daughter attending school in the U.S.?

RC: You could qualify based on rental income from the property, even if your daughter resides there. Lenders assess the property’s income potential rather than personal residency.

Q: Are you able to connect foreign investors with local realtors and a support network?

DK: Absolutely. We can facilitate connections with trusted realtors, accountants, property managers, and other professionals to support foreign investors in navigating the U.S. market effectively.

Q: What is the average mortgage rate for foreign buyers of U.S. Properties at 75% LTV through America Mortgages?

DK: The average mortgage rate for foreign buyers at 75% LTV typically ranges around 1% higher than rates for U.S. citizens with excellent credit. However, rates may vary based on individual circumstances.

Q: Does the Rental Coverage + program require tax returns?

DK: No, it doesn’t. The Rental Coverage + program simplifies the qualification process by considering only the rental income of the property, making it easier for investors to secure financing without providing tax returns.

Q: Do you provide loans to renovate and flip a property?

RC: Yes, we do, but it’s typically more challenging for foreign investors to qualify unless they have extensive experience in real estate flipping. Generally, investors need a track record of successful flips to qualify for such loans.

Q: How do some recent changes in commission laws impact this whole process in the U.S.?

RC: Recent changes in commission laws primarily affect realtors and don’t directly impact mortgage lenders. However, it’s essential to stay informed about regulatory changes as they can indirectly influence the real estate market.

Q: The minimum loan amount is 150k. Can it be lower?

DK: Yes, on special occasions, we may consider lowering the minimum loan amount to around $100,000. Additionally, for investors with multiple properties, we can explore portfolio loans, grouping properties to meet the minimum loan requirement.

Q: Do you have any thoughts on investing in Durham, North Carolina, in terms of rental yield?

DK: Durham, North Carolina, presents an interesting investment opportunity with potential rental yields around 15%. However, it’s essential to conduct thorough research and analysis to ensure it aligns with your investment strategy and goals.

Q: Do you lend to Limited Partnerships?

RC: Yes, we do. Limited partnerships can qualify for financing, provided they meet our lending criteria and requirements. We can discuss the specifics of your partnership structure to determine eligibility and options.

Q: Does America Mortgages provide loans for properties in the UAE?

DK: No, our lending services are primarily focused on properties in the U.S.. However, we can offer guidance and assistance in financing U.S. properties for investors based in the UAE.