The New Opportunity for foreign purchasers in the USA.

Over the previous 3 years the US housing market in most States of America slowed dramatically showing signs of recession in early 2007. The result of rapidly increasing home values from 2000 to 2004 enjoyed by the Americans paid it’s toll and many are suffering with increased interest rates from their initial low start rate products, and in some cases keeping up their mortgage payments has become extremely difficult. The Federal Reserve assisted in the abrupt change in upward trend by increasing the cost of borrowing back to a max in 2004, which has been hurting many of the homeowners over the past few years.

Although it will take the Americans time to recover from this slump it has exposed a genuine opportunity for foreign buyers to invest into the USA.

Already we are seeing an increased interest in investment and second home purchases by the Europeans, many taking advantage of both the weak Dollar and motivated sellers willing to reduce their selling price. The overseas buyers have a huge advantage over domestic deals and amazingly so much inventory to choose from priced lower than 5 years ago.

The savvy investors from overseas have not waited for marketing from US companies showing the obvious advantages of purchasing before the prices start increasing again. Investors have been forefront in snatching up a portion of the bargains currently available in some States, New York, Florida and Texas for example, and are lucky to catch the market whilst it remains poor for homeowners and excellent for homebuyers.

With the Federal Reserve once again lowering their interest rates, making financing more attractive, the housing market is poised to change direction, perhaps as rapidly as it did three years ago.

The Feds are expected to further reduce rates continuing to boost the huge economy of the US and further lowering the mortgage interest rates for borrowers.

Foreign National Purchases and Mortgages.

Due to differences in procedures it is advisable to obtain the assistance of a qualified realtor and overseas mortgage company when purchasing in the US.

Be sure to find a company or person who is familiar with foreign purchases and works for you only and not the seller. Realtors are highly regulated by law.

Real Estate Companies can assist in buying ANY home within their companies Licensed States.

They do not charge you for their services.

Only licensed and state regulated Realtors should be relied upon for advice and to ensure the purchase runs smoothly and on your terms.

The process is very straight forward, although does have differences, which any experienced realtor translates into buyers understanding protecting you throughout.

Usually at least four separate inspections are carried out during the purchase process, each time the full report is provided to the customer and if anything is unsatisfactory the seller has the opportunity to rectify or the buyer reduces purchase price or purchases elsewhere.

Title companies in the US, a property transaction is more often than not completed without the use of a lawyer and or Solicitor. The realtors are trained to carry out the majority of requirements and a title company (closing agent) is used to complete the transaction. In the US the title company does the work of a Solicitor in the UK, they are independent and ensure that the purchase and property itself is clear of faults. The title company legally changes the title (Deed) into the buyers name and goes as far as to actually insure you against any irregularities, should they arise.

Foreign national mortgages are only available from select lenders, and International mortgage Financing is strictly regulated by US law, primarily protecting borrowers.

Due to the housing market being enormous many American lenders are (shamefully) unaware of purchasers from overseas or unwilling to provide. In the scheme of things this is a smaller market, you may here from them that they can provide, however when push comes to shove you end up going back to the specialists.

There are fundamental differences between domestic mortgage criteria and qualification of an overseas buyer.

Once you find a company who deals in this market it is often far more straightforward than qualifying at your local bank for a mortgage back home.

In UK terms the foreign mortgage market of the US is a large industry with many products available to choose from.

Rent Roll
This is a spread sheet describing the leases and occupancy of a building. It tells the tenant name, lease start date, lease end date, # of units, square footage, amount of rent and how long each tenant has been there.

Income /Expense Statement
This gives a detailed account of all income, rents and other income, as well as all of the expenses associated with the property.

Multi Family
A building designated to house more than four families (more than four units).

Mixed Use
A building that has more than 1 use. Usually residential units and then a retail, office or industrial use with in the same structure.

               IFC’s Tertiary market is made up of countries where significant returns are possible, but the risks may be prohibitive.

POUND BREAKS $2 BARRIER

The ongoing weakening of the US dollar reached a significant benchmark this week, with the US currency breaching the $2=£1 barrier for the first time since 1992. Expectations of further interest rate rises in the UK, coupled with weaker-than-expected financial data in America, saw sterling lift to $2.003 on Monday; though the dollar quickly strengthened after that point, the two-dollar barrier was broken again on Tuesday and sterling seemed to be holding at above two dollars through the rest of the week.

At press time the pound was worth $2.0045, with further gains being predicted in the run-up to the next meeting of the Bank of England’s policy committee on May 10, at which interest rates are expected to increase to 5.5 per cent – which would be the fourth increase since August. Meanwhile, the dollar – also weakening against the euro – is expected to take further hits in the face of what are expected to be gloomy economic figures through the end of April.

“For those planning to take the plunge and buy in a dollar country, or even go on holiday, now is a fantastic time to get the most for your money… It’s worth remembering that the last time the pound traded consistently above $2 was in 1975.