The American real estate market became quite popular for investors from all around the world. Many people decide to invest their savings in a dream house in the US. You may be wondering what is the main reason for that? Encouraged bu the low US real estate prices, and the friendly laws or regulations for foreign investors, many decide to make such investments. And since the Australian house prices remain stable, it’s no wonder why so many Australians want to invest in US real estate properties. Many of them rush to use this once-in-a-lifetime opportunity and to experience the famous American dream. Even though it seems like a safe thing to do, there are some things you need to consider before you buy a US real estate property.
source: SMSF Warehouse
- It doesn’t matter whether you want to buy a US real estate property to live there or to rent the property, you still need to decide where to buy and how much to spend. Buying a US real estate property is not a joke. If you don’t have any previous buying experience, then you better leave things in hands of a professional real estate agent.
- The lending conditions in America are clearly more difficult than they were in the past. Even though difficult, you can still qualify for a mortgage from an American lender. In some cases, you don’t even need to fly over there to get the loan.
- You don’t need to inform the Australian Taxation Office when you buy a US real estate property. But, it is advisable to disclose certain information in the self-assessment system. These information are needed for future income and capital gains or losses, and many other expenses that need to be included in your tax return.
- Make sure that the US real estate property you want to buy is located in a state that offers a double tax agreement. This way your rental income will be eligible for taxation. In case you didn’t know, you can claim deductions on overseas rental properties as well. Just make sure you include them in the ‘foreign source income’ section.
- Australia doesn’t have any strict rules about transferring large sums of money overseas. But, it is good to check whether you can transfer funds outside Australia in order to buy US real estate property.