The Foreigners Guide to Success
- New York City Real Estate
- Top 10 Reasons to buy in New York City:
- New York City: Foreign Investor Mecca
- 15 Most Attractive Reasons Foreigner’s Invest in New York City
For the past few years, the dollar has ranked weak against many other currencies such as, the Canadian Dollar, the EURO, The Swiss Franc and the British Pound. This has attracted savvy foreign investors who are looking for the inherent added value that a strong currency brings. This trend has also motivated US Real Estate Brokers to ramp-up their international marketing efforts to garner these eager foreign investors, buyers –and renters.
In addition to the ROI expected from any investment, many foreign investors can ‘get in the deal’ for less than their American counterparts. This fact enables foreign investors to buy ‘top real estate’ in the best markets; which ultimately attracts the best clients and limits their over-all risk.
New York City real estate is the most sought after real estate in the United States. In fact, since 1976, due to flexible purchasing laws, coupled with a comparably low crime rate and a healthy political environment, foreign investors now represent 15% of purchasers, and buy a mind-boggling 33% of Manhattan condominiums.
1. Market Size -New York City is America’s most populated City.
2. Convenience –There are more than 8 million taxi cabs.
3. Population Growth –The Association of Foreign Investors in Real Estate, voted New York City as the most attractive destination for real estate investment.
4. International Appeal -The recent Knight Frank Wealth Report 2011 ranks Manhattan as the #1 real estate market in the world.
5. Crime Rate -Since 2005, the city has had the lowest crime rate among the 25 largest U.S. cities.
6. Value –According to AOL Real Estate, published on October 12, 2011: In terms of square footage, real estate in New York City (selling around $1,068 per sq. ft.), is “downright cheap” compared with Paris ($3,287 per sq. ft.), London ($1,590 per sq. ft.), Singapore ($1,561 per sq. ft.), and Hong Kong ($1,118 per sq. ft.).
7. Inherent Value –The current currency exchange rate gives many foreign investors more value for their money in New York City, than they would get in their own local markets.
8. Expertise –Real Estate experts in New York City are amongst the best in the world. They are very accustomed to working with international investors and many firms are multi-lingual and hold satellite offices around the world.
9. Events –New York City is exciting, and an easier ‘sell’ or ‘rent’ than many other –even more expensive- cities. From large annual events such as the Macy’s Day Parade and New Years in Times Square, to movie productions like Spiderman and King Kong, everyone knows New York City.
10. Ease of Entry –New York City Government has made real estate investment in the city easy for international buyers. In many cases, a foreign investor is not required to show US Tax Returns nor establish a US Corporation.
New York City is a Mecca for foreign investors due to its international lifestyle. The city is amazingly diverse and ultra-sophisticated as well. In addition to the lifestyle, there are many strategic advantages which attract savvy foreign investors to the city.
1. Ease of Purchase –As a foreign real estate investor, you will receive a warm welcome to the city. Since approximately 15% of Manhattan apartments and condominiums are owned by foreign people and companies, real estate professionals are very comfortable handling international transactions, purchases and property management.
2. Convenient Ownership Options –the majority of foreign investors initially purchase their property as a ‘summer home’ or pied-a-terre. Since purchasing a condominium (as opposed to a co-op) is most favorable, due to higher appreciation potential and more flexibility if you decide to rent-out your unit.
3. Product Standards –Nearly all of new construction in New York City are condominiums. In addition, the value of your condominium can be as much as 30% higher than a co-op.
4. High Market Demand –According to a survey commissioned by the Council of New York, of the cities limited real estate, only 30% of the building are currently condominiums. The other 70% are set-up as co-ops; which limit foreign investors in many ways; such as, ease of purchase, remodeling and they require US Tax Returns. Plus, co-ops don’t usually appeal to the renter market.
5. Financing Options –Foreign real estate buyers with Visa’s or ITINs can obtain a ‘mortgage loan’ through either a US or Non-US Bank. Though many banks, either foreign or domestic require a 30% down payment, as well as a good credit score, many banks offer ‘pre-approval’ which can give you a better idea of your options.
6. Needs Analysis –Foreign investors and buyers are urged to work with a real estate broker to develop their needs analysis. For financing from the US, bank requirements may include, but not be limited to: a US bank account for at least 6-months, a line-off credit established in your home country, a down payment, copies of your visa and/or passport, employment verification, 1-year of rent or mortgage payment history and that the property you are looking to buy has at least 70% of its units already sold or on contract.
7. Tax Advantages –Cash buyers can save around 2% on the New York Mortgage Tax, as well as many bank fees associated with financing.
8. No Broker Fees –Foreign investors, buyers and renters DO NOT pay the brokers fee. In New York City, the commission(s) are pre-negotiated and paid by the seller or owner of the property.
9. Peace of Mind –Your New York City Real Estate Agent or Broker is required to help you to identify the right property and negotiate your best price. He or she will have your best interest in mind, your broker/agent is required by law to present ALL offers to the seller, or risk losing their license.
10. Owner Renter Ease –In New York City, the higher cost-of-living attracts a better clientele. Many brokers offer end-to-end services, and can handle the entire transaction for you. From the purchasing, financing, advertising, searching for, screening and approving tenants, execution of leases as well as ternate move-in.
11. Convenient Maintenance –The maintenance of your unit is handled via a superintendent and/or management company. Many tenants will talk to you directly, your superintendent and/or the buildings doorman. The superintendent can make minor repairs for no charge or they may charge for materials only. For repairs which they cannot do internally, they will recommend a specialist. If you choose a management company, additional fees of up to 10% of the gross rent may apply.
12. Value Retention –Any real estate in New York City, especially in the Manhattan area is expected to retain its value. The city is America’s capital for finance, the arts and education.
13. Inside Information -For the long-term investor, the Upper East Side near the river are currently being developed for two new subway lines. The Federal Transit Authority and MTA have predicted that the Second Ave. subway would open by the end of 2016 to 2018.
The extension of the subway line 7 is expected to be complete by December 2013, offering ease of transportation to commuters and residents in Midtown West. The last stop will be 34th Street and 11th Avenue.
14. Recession Proof –Though many cities in the United States have experienced downturns and negative market indicators, New York City has a unique advantage in its ‘Global Appeal’ which allows it to leverage both buyers and renters from around the world.
15. Corporate Ownership Options –As a foreign investor, you can purchase and own real estate in New York City either in your own name, or in the name of a Limited Partnership, Limited Liability Company, Real Estate Investment Trust or a Domestic Corporation. Consult your attorney and tax professional for which entity will best work for your unique situation.
All information is from sources deemed reliable but is subject to errors, omissions, changes in price, prior sale or withdrawal without notice. No representation is made as to the accuracy of any description.