Forums / Property Investing / Overseas Deals / Back from living/investing in USA for past 7 years. Ask Me Anything

Viewing 14 posts - 21 through 34 (of 34 total)
  • Profile photo of dhillon2dhillon2
    Participant
    @dhillon2
    Join Date: 2007
    Post Count: 24

    @Sitbon- I agree with everything Nigel said. Regarding question (3) – Trulia and citydata are ok solutions for the data you’re looking for that are free. However I use mainly use Costar & Yardi Matrix for such info. Both sites are behind fairly pricey paywalls. PM me and I may be able to get you a report if you tell me what specific market info you want.

    For Question (4) – I’ve only done Apartment Buildings here. For larger apartment buildings you’re looking at 3-5% of gross income. Houses I don’t know

    Profile photo of dhillon2dhillon2
    Participant
    @dhillon2
    Join Date: 2007
    Post Count: 24

    @Sydney99- wow, that’s alot of questions. I’ll do my best. But I must say, your questions are very transactional in nature, which is a little too granular for me. I’ve got attorneys that handle the transactional side of things. My job is to make sure the deal underwrites, and then implementing the business plan. If you have questions of that nature I can be more useful.
    Anyway, here it goes-

    1) To open up a US bank account you gotta essentially do it in person in the US. Unless you’re an HSBC Premier customer. I’ve got a third method that involves a personal contact of mine, but I have to get to know you first :)

    2) Yeah I guess.

    3) It depends on your strategy- what kind of asset protection and structures you want in place. But from a purely transactional perspective, no, you do not NEED to setup an LLC first.

    4) LLC’s are state based. Accordingly the rules governing each are different. This is beyond my scope.

    5) You can source property yourself or you could pay someone to do it for you. Within each category there’s a whole constellation of service providers at all different prices ranges, depending on how much work you want to do and how much you want to pay.

    6) Yes, you can get a building inspector to do that.

    7) I deal with Commercial property (Apartment buildings) attorneys essentially draw up all the documents.

    8) Direct this question to an attorney

    9) In Commercial property, its whatever agreement you can come to between you and the seller.

    10) No

    11) I use wire transfers

    12) Yes

    13) In my experience, everything is electronic, then when you close you get a very very thick
    wad of papers.

    14) You are missing many steps. Get in touch with an attorney you trust. If you need help in this, I can refer you to people I’ve used.

    Hope that helps Sydney99 :)

    Profile photo of sydey99sydey99
    Participant
    @sydey99
    Join Date: 2008
    Post Count: 56

    @Sydney99- wow, that’s alot of questions. I’ll do my best. But I must say, your questions are very transactional in nature, which is a little too granular for me. I’ve got attorneys that handle the transactional side of things. My job is to make sure the deal underwrites, and then implementing the business plan. If you have questions of that nature I can be more useful.
    Anyway, here it goes-
    1) To open up a US bank account you gotta essentially do it in person in the US. Unless you’re an HSBC Premier customer. I’ve got a third method that involves a personal contact of mine, but I have to get to know you first :)
    2) Yeah I guess.
    3) It depends on your strategy- what kind of asset protection and structures you want in place. But from a purely transactional perspective, no, you do not NEED to setup an LLC first.
    4) LLC’s are state based. Accordingly the rules governing each are different. This is beyond my scope.
    5) You can source property yourself or you could pay someone to do it for you. Within each category there’s a whole constellation of service providers at all different prices ranges, depending on how much work you want to do and how much you want to pay.
    6) Yes, you can get a building inspector to do that.
    7) I deal with Commercial property (Apartment buildings) attorneys essentially draw up all the documents.
    8) Direct this question to an attorney
    9) In Commercial property, its whatever agreement you can come to between you and the seller.
    10) No
    11) I use wire transfers
    12) Yes
    13) In my experience, everything is electronic, then when you close you get a very very thick
    wad of papers.
    14) You are missing many steps. Get in touch with an attorney you trust. If you need help in this, I can refer you to people I’ve used.
    Hope that helps Sydney99 :)

    @dhillon2, Thanks for answering most of the questions.
    Can you please refer people you have used.
    business plan – Can you please explain more on this? is it similar to having a goal to reach income and having a plan to achieve or something different? always Love to learn new stuff

    Profile photo of CaesarCaesar
    Participant
    @cerrodelangel
    Join Date: 2017
    Post Count: 4

    Hello Kevin and Dani. My name is Cesar, I also live in Houston. Between 2010 and 2013 I liquidate all my assets in the U.S because I was going thru divorce and I decided to Invest heavily in Chile, I purchase a Farm and Ocean property in Chile. I have a good eye for land because I was a developer and builder here in Houston. Let me make it short, I already plat a portion of the property for residential and another portion for farming, I create a web page last November and I’m getting close to 1000 views per month, lots of inquiries and almost every week someone ask me to meet at the farm, but I can’t fly to Chile every week and i keep telling people that I will start selling lots when I start development. The problem is that I though I was going to sell my construction business in Houston and use that money to move to Chile and start development. Broker told me that less than 30% of business sell and the ones that sell usually carry a note, I already have two potential buyers with 20% down and the rest owner finance.

    I run a good business that nets me around 150k a year and a big chunk of that money went to pay for my daughters college and living expenses, and both daughters just graduate in Agricultural Engineering, Texas A&M and Business at University of Houston, I got married again and have a 2 year old boy and a 9 year old stepson. Basically I’m trying to find a partner to help me with the cost of developing the Farm,community and ocean property, take a look at my web page and let me know if you are interested or have any suggestions. http://www.pencahue.com 281/642-1866

    I build wood-metal fences, decks and also do wood cabin renovations, Im doing a cabin renovation in Magnolia for the next 2 weeks.

    Have a great week. Cesar

    Profile photo of dhillon2dhillon2
    Participant
    @dhillon2
    Join Date: 2007
    Post Count: 24

    @Sydney99- Hi Raj, by business plan I refer to implementing your specific strategy to get the asset to achieve the financial outcomes you want it to. Put another way, how you’re gonna add value.

    As an example- In my last deal the business plan was to rehab 1/3 units in the next year and increase rents 9%. The other part of the equation was to cut expenses by installing 150 new toilets and shower heads to save on utility costs.

    Profile photo of dhillon2dhillon2
    Participant
    @dhillon2
    Join Date: 2007
    Post Count: 24

    @caesar, the only I’d say would be such a post might run you afoul of the SEC. I see from your website that you’re soliciting funds and promising a return. You are therefore issuing a security- and assuming Americans can see this post and your website, you will come under the jurisdiction of the Securities and Exchange Commission.

    Again, I don’t know what type of investor you’re trying to target, but under SEC Regulation D 506(b) you can’t do a general solicitation. So you can’t adertise on this forum or on your website. However under 506(c) you can do general advertisements, but you’ll have to make clear on your website that the deal is only open to Accredited Investors.

    I say this because if you don’t check all the boxes, the SEC could force a sale of your assets, and/or your investors have grounds to sue. Again, I’m not an attorney, but that’s my understanding of the law. So I recommend you speak to a securities attorney to keep you safe.

    Good luck & I wish you success :)

    • This reply was modified 1 year, 11 months ago by Profile photo of dhillon2 dhillon2.
    Profile photo of EngeloRumoraEngeloRumora
    Participant
    @engelorumora
    Join Date: 2010
    Post Count: 618

    Hey Kevin & Dani,
    Thanks for choosing to give back :)
    I want to do my first deal in the US soon and would appreciate any advice. I’m currently in the research phase. The areas that I’m mainly looking at is Austin and Dallas Fort Worth though I’m flexible on the location. I’ve been to most of the major US cities.
    I’m thinking either of buying a multi family house, renovating it and then flipping it or doing a small apartment building development from scratch.
    My question is which city would you recommend looking at for the best opportunities for short term flipping and any suggestions generally on getting started doing this in the US.
    Cheers

    Looks like we missed each other in the US

    I’m still here and plugging away lol

    Also, moved for real estate

    Fast forward 6 years and 500 deals later, time are good

    Amazing opportunities here for those that want to work for them

    Many pitfalls tho as it’s much shadier than in Australia

    Thanks

    EngeloRumora | Ohio Cashflow
    http://ohiocashflow.com/
    Email Me | Phone Me

    "Make a PASSION an OBSESSION and you'll never work a day in your life"

    Profile photo of dhillon2dhillon2
    Participant
    @dhillon2
    Join Date: 2007
    Post Count: 24

    Hi Engelo, sorry, have we met? Were we meant to meet up sometime? :)
    Are you Zach’s friend?

    Profile photo of EngeloRumoraEngeloRumora
    Participant
    @engelorumora
    Join Date: 2010
    Post Count: 618

    Hi Engelo, sorry, have we met? Were we meant to meet up sometime? :)
    Are you Zach’s friend?

    We haven’t

    I was just referring to fellow Aussie’s being together in the US and never catching up hehe

    I’m still stuck here lol

    Thanks

    EngeloRumora | Ohio Cashflow
    http://ohiocashflow.com/
    Email Me | Phone Me

    "Make a PASSION an OBSESSION and you'll never work a day in your life"

    Profile photo of Ricky JohnsonRicky Johnson
    Participant
    @fixedandsold
    Join Date: 2019
    Post Count: 0

    So are you still in the states now or back in Australia? I think the real market in the US is for larger, highend flips over $500k which doesn’t seem like much in Australia but buys quite a bit of house in many US markets. I also like apartments and the group I am with is eye balling some C-D properties that can be bought fairly cheap and then renting the rooms separately. The numbers look great so we shall see what they do. I’ve been enjoying great returns with them the past few years and hope it continues that way.

    Ricky Johnson
    Phone Me

    Profile photo of dhillon2dhillon2
    Participant
    @dhillon2
    Join Date: 2007
    Post Count: 24

    Hi Ricky, so I live in the US, but it just so happens I’m back in Australia during this period- like I am every Christmas and new year. Always nice to visit friends and family at home. While I agree the money is in larger properties (because of scale) and money can be made from flips, I prefer a projects with a cashflow component.

    Incidentally, since I’m here in Melbourne for the next 3 weeks, till we leave at the end of Feb, we’re having a meetup so people can ask us any questions. Details here-

    Beat the Market by Going Overseas

    Tuesday, Feb 19, 2019, 7:30 PM

    Chadstone – The Fashion Capital
    1341 Dandenong Road Chadstone, AU

    5 Members Attending

    Wanting to diversify your portfolio? Hedging yourself against inflation? Not sure where the Aussie Dollar is heading to? Wanting a safe, passive and profitable way to own real estate? Find out how we managed to mitigate these issues and achieve FINANCIAL FREEDOM in our 20s by investing in US Commercial real estate. >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>…

    Check out this Meetup →

    Profile photo of Dale SmithDale Smith
    Participant
    @propertyinvetsor888
    Join Date: 2019
    Post Count: 0

    Curious to know how you factor in local property taxes in the US? I often see houses advertised for ludicrously cheap prices in these run down cities, but seems like the property taxes are still huge?

    Profile photo of DeanCollinsDeanCollins
    Participant
    @deancollins
    Join Date: 2015
    Post Count: 372

    @dale,

    Property in the USA is cheaper because they have more tier2 cities.

    I’ve said it before multiple times until its just as cool to live in Nowra, Orange, Port Macquarie as it is Sydney, housing=expensive in Australia.

    This said regarding property taxes……you have to remember property taxes in USA is different to council rates in Australia.

    Its is the main format that USA cities fund police/municipal services/schools etc.

    For example I live in a modest apartment building here in Brooklyn Heights, New York. We have 6 apartments in our building (our apartment is the largest at 2br/2bth 160m2 – the other 5 are 1br or studios).

    Our buildings annual budget is $60kpa and over half of that goes to city taxes (eg $30k). The other $30k covers everything else eg heat/water/gas/repairs/building insurance etc etc

    So for my wife and I our portion of the monthly bill is a little over $2k a month or $24k a year.

    Its high and we also have a city income tax bill of 3%pa of wages/salary etc but that $24k a year pays for everything that the city provides eg police/schools etc and we are ok with that…..lol though wish it was lower etc etc but it does make it expensive as a property investor to actually make a ROI on investments over here once you take property taxes into consideration (as a matter of interest our federal is 19% and state 6% + the city 3%).

    Basically a good rule of thumb is city taxes is around 1% of the property value per annum (eg our apartment is worth about US$2.4m). Some cities charge more (a lot more eg 3%) some charge less.

    I hope that answers your question on property taxes and why they are high.

    • This reply was modified 2 months, 2 weeks ago by Profile photo of DeanCollins DeanCollins.
    Profile photo of dhillon2dhillon2
    Participant
    @dhillon2
    Join Date: 2007
    Post Count: 24

    Hi Dale, thankyou for your question. Dean is right, property taxes can take a huge bite out of an investor’s returns. So how do I get around it? Simple. I avoid residential property and only do commercial real estate (larger apartment buildings, retail, office industrial etc). That’s because commercial real estate is sold NET of property taxes, insurance, maintenance, property management, staffing, advertising etc etc.

    The cap rate these properties are sold at is after all these expenses have been paid. Coupled with the scale commercial property affords, it’s muuuuuch easier to project future cashflows for commercial real estate than residential, where you have to guestimate these expenses yourself.

    Hope that helps

Viewing 14 posts - 21 through 34 (of 34 total)

You must be logged in to reply to this topic.