In our previous post, How The Housing Market Crisis Affected US Investment Properties – Part 1, we talked about the back story to the US Housing Crisis. Today we are going to look at how real estate investors are using the US housing crisis to get the best investment properties.
Here is what the savvy real estate investors are doing:
Having A Plan – Start with a real estate investing plan in place and find a real estate power team that can help them execute the plan.
Set Up Proper Financial Structures – Entity structures are set up (such as a trust or LLC) for asset protection and liability protection by working with national and, or international tax accountants to make sure that their homeland laws do not create a double taxation issue with the US tax laws.
Understand Cash Is King – The domestic currency of many of the foreign countries, when converted to US dollars provides massive leverage. Using currency exchange facilitators to maximize the conversion of their dollars to U.S. Dollars by purchasing exchange rates when the dollar exchange is at its peak and then they can lock that exchange rate in for as much as two years. This gives them even more leverage.
US Lending Is Stagnant – The reason that home prices are so low is that a smaller percentage of people can actually get a loan for purchasing a US property. Foreign real estate investors are leveraging anything they can in their homeland to create the cash. Many just have cash, others have secured lines of credit to their homes or businesses.
Picking The Best Locations To Invest – Experienced real estate investors understand the importance of investing in the best locations. They do their diligence to make sure WHERE they invest within the US has the best markets to maximize their rate of return. Also that the market they choose is able to sustain the rate of returns they seek.
Effortless Equity – One of the keys to succeeding at US real estate investing is to find turnkey properties that are sold at below retail prices which gives immediate equity value from day one.
Property Management – It is vital to make sure that the turnkey property provider also provides excellent property management.
Affordable Financing – Smart investors position themselves to acquire US credit so that as the financial markets rebound, they will be able to qualify for US financing.
Forward Thinking – As this financing comes available, they plan to put some mortgages on their properties to further leverage their cash and purchase more properties.
We work with foreign and domestic real estate investors every day, putting these plans in place and making the connections to find turnkey properties with solid finacials and ongoing property management support. If you would like to find out more about the investment properties we represent or how real estate investing works in the US, give us a call today! 941-718-7761
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