Australian investing in US properties

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Australian investing in US properties

Armand Aguillon
Investor · Gold Coast, Queensland · Member since 2015 · 4 posts · 2 votes

Hi,

My name is Armand and I live in Queensland.  I am an Australian who currently buys US investment properties and am hoping to connect with like minded Aussies who are currently investing (or living) in US and/or looking to invest in US.

It would be good to connect or get to know you and network - as 2 or more minds are always better than one.

I've had pitfalls in learning how to invest in US along the way but have learnt a lot of things in the process and am always learning in the process.  Happy to share my knowledge with you and learn from you.

Have a good day all and look forward to meet you.

Cheers,

Armand

2Reply
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Gaynor Pendleton
Investor · Gelorup, Western Australia · Member since 2016 · 13 posts · 4 votes
9y

Hi i am a fellow Aussie who is currently investing in the US and also have obtained finance in the US.   It seems near impossible when you first start out, But don't give up it is worth it.  

Do you need a LLC? - i would say this really depends on your financial situation and the tax benefits you are looking for, and how many properties you have. When we commenced our biggest concern was protecting our assets here in Australia I did not want to take the chance of loosing everything we had worked so hard for here so started with a LLC - which cost $550, all states are different so it will depend on where you are interested in buying property as to where the LLC is set up and you must have an agent in that state there are companies that do this or it could be the property manager. The state has to have a local person to contact if required, and any mail addressed to the LLC will also go to this address which then needs to be sent on to you.

Do you require a US bank account - Yes - you don't want to have to pay fees for transferring money all the time, once you have a few rental properties generating income, and bills to be paid it soon adds up and all your profits will disappear. Opening a bank account is not as easy as it once was but still can be done, the big banks such as Bank of America, Wells Fargo etc will want you to open an account in the LLC or C-Corp (business account) and a personal account (in your name) which will require a monthly balance to avoid fees just like here! the Personal account is to start a credit rating in the US. Another option is looking at the smaller banks in the state you are interested in buying they are easier to deal with for example: Enterprise Bank & Trust in Kansas. It can be done on line but if possible it is best to take a trip over there and check things out, face to face is always best.

Getting finance in the US is possible but the rates will be around 6 - 7% and until you have a few properties and a credit rating in the US you will be asked to put down a high deposit, my first was at 50% down, you will also need to work with a broker to achieve this.   

It really comes down to your current situation and do you have the financial backing to get started, do you require the income now or are you planning for the future.  

Always happy to chat have learnt a lot since starting, and still learning it is so different to here. 

Cheers 

Gaynor 

2Reply
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26 Replies

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  • Rita Bautista
    CEO · Chicago, IL · Member since 2015 · 108 posts · 20 votes
    11y

    Hi Armand,

    I have a client from New Zealand investing in Florida.  I would be interested to learn more about your experiences.  

    0Reply
  • Jeff Morelock
    Rental Property Investor · Marianna Florida · Member since 2011 · 357 posts · 169 votes
    11y

    Hello Armand,

    Don't forget about us yanks lol. We know our backyard. I'm in Florida and there are deals to be had.

    Jeff

    0Reply
  • Armand Aguillon
    OP
    Investor · Gold Coast, Queensland · Member since 2015 · 4 posts · 2 votes
    11y
    Originally posted by @Rita Bautista:

    Hi Armand,

    I have a client from New Zealand investing in Florida.  I would be interested to learn more about your experiences.  

     Hi Rita,

    Just sent you a connection request.

    Cheers,

    Armand

    0Reply
  • Armand Aguillon
    OP
    Investor · Gold Coast, Queensland · Member since 2015 · 4 posts · 2 votes
    11y
    Originally posted by @Jeff Morelock:

    Hello Armand

    Don't forget about us yanks lol. We know our backyard. I'm in Florida and there are deals to be had.

    Jeff

     Hey Jeff,

    I think connecting with yanks is a given... of course it would be awesome to connect with you (and others).  Florida is one of the places I've been looking at lately.

    Looking forward to connect with you.

    Cheers,

    Armand

    0Reply
  • Brandon Montano
    Real Estate Investor · San Diego, CA · Member since 2015 · 6 posts · 1 vote
    11y

    Hey Armand,

    If you are an Australian investing here into the states I think my company can help strengthen your portfolio!  Let's connect!  We have have properties in different locations here in the states and we can help diversify your portfolio and even can give you the opportunity to finance.

    I'm so happy to know Australians are now starting to get into bigger pockets.

    0Reply
  • Michael S.Pro Member
    Biggerpockets Support · Las Pinas, Metro Manila · Member since 2015 · 7k+ posts · 1k+ votes
    11y

    @Armand Aguillon

    Welcome to Biggerpockets. Great to have you here

    BiggerPockets
    0Reply
  • Armand Aguillon
    OP
    Investor · Gold Coast, Queensland · Member since 2015 · 4 posts · 2 votes
    11y
    Originally posted by @Michael S.:

    @Armand Aguillon

    Welcome to Biggerpockets. Great to have you here

     Thanks @Michael S., much appreciated.

    Cheers,

    Armand

    0Reply
  • Suvir Salins
    Rental Property Investor · Wentworth Falls, NSW · Member since 2016 · 20 posts · 24 votes
    9y

    Hi Armand,

    I live in Sydney. Just joined BiggerPockets. Would love to learn about your experience investing in the US. I've been following Clayton and Natali Morris of MorrisInvest. They have a podcast that is dedicated to Buy and Hold property investing and also offer a Turnkey Property investing service. Got introduced to BiggerPockets when both Clayton and Natali appeared on the BiggerPockets podcast. I have equity in my house which I'm looking to invest. As you know ROI here at home is very poor so was very interested to find out how good it is in the US and that Aussies like us can get into that market. Also aware there are a lot of bad operators out there looking to exploit people like me. So very interested in networking with people I can trust. Have been doing a fair bit of research over the last few months. Got a tonne of questions around tax, structuring LLCs, how to leverage safely etc etc. Current thoughts are to set up a Family Trust in Australia which then manages a Holding Company LLC in the US. The Holding LLC then has several Child LLCs which actually own the properties. Max $150K worth of properties in each child LLC to limit risk. Holding LLC also limits risk and streamlines accounting. Anyways could go on and on but would love to hook up and start a dialogue.

    Kind regards,

    Suvir

    0Reply
  • Jordan Sinclair
    Investor · Adelaide, South Australia · Member since 2015 · 136 posts · 78 votes
    9y

    The structure you mentioned is complex unless you are looking at significant assets. LLC's can be setup to change the member later so a Family Trust/Pty Ltd can own the LLC in the future.

    0Reply
  • James Wise
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
    9y

    Welcome to the site.

    0Reply
  • Suvir Salins
    Rental Property Investor · Wentworth Falls, NSW · Member since 2016 · 20 posts · 24 votes
    9y

    Thanks for the welcome and feedback guys. Any Aussies out there who have any info on how to structure their investments ie trusts, LLCs, where the LLC should be located, tax accountants to use, if and how to setup a US bank account (heard this is hard and not sure if really necessary), etc etc. I've listened to several podcasts detailing some of this but would love to hear from actual investors who aren't necessarily pushing their own business.

    Cheers,

    Suvir

    0Reply
  • David Traeger
    Investor · Adelaide, Australia · Member since 2016 · 39 posts · 5 votes
    9y
    Originally posted by @Suvir Salins:

    Thanks for the welcome and feedback guys. Any Aussies out there who have any info on how to structure their investments ie trusts, LLCs, where the LLC should be located, tax accountants to use, if and how to setup a US bank account (heard this is hard and not sure if really necessary), etc etc. I've listened to several podcasts detailing some of this but would love to hear from actual investors who aren't necessarily pushing their own business.

    Cheers,

    Suvir

     Hi Suvir

    From my research, LLC costs about a grand to setup and has an EIN which you use to setup a bank account. This is needed, in order for you to close (or settle in our Australian lingo) on properties, and also for rents to go into.

    I'm an experienced investor in Australia, looking to venture into USA for the first time like yourself, my main issue at the moment is difficulty of getting finance. We could probably buy a couple outright, but leverage is king ;)

    Cheers

    Dave 

    0Reply
  • Suvir Salins
    Rental Property Investor · Wentworth Falls, NSW · Member since 2016 · 20 posts · 24 votes
    9y

    Hey Dave,

    Yeah that's what my research is telling me too. Be great to confirm with someone who's done it. Also heard people using FX accounts to transfer funds from Oz to the US accounts. 

    Agree re leverage for best returns. But thinking that might have to wait. Thinking buy some outright then a couple years later the LLC will be able to take out finance. At least that's what I've read.

    What areas you looking at? How're you planning to manage them, PM? Being a beginner my main concern is being taken for a ride so trying to hookup with experienced investors who can educate me as to what traps to avoid. Been looking at Turnkey as a passive way in. Thoughts?

    Thanks,

    Suvir

    0Reply
  • Federico Gutierrez
    Realtor · Cleveland, OH · Member since 2015 · 2k+ posts · 857 votes
    9y

    @Armand Aguillon I'd be interested to know what and where you hold here in the USA.

    I'm an Australian been living all over America since 2010. I own here in Cleveland and have properties in Brisbane and Cairns, QLD.

    Lucky for me is I'm based here so I don't face the issues of many internationals. I have bank accounts and LLC's. So would like to know how you got this all set up with our being a resident of the country

    1Reply
  • Ryan Landis
    Residential Real Estate Broker · San Mateo, CA · Member since 2013 · 585 posts · 264 votes
    9y

    @Armand Aguillon welcome! Make sure to post about your experience for others to learn from it!

    0Reply
  • Account Closed
    Investor · Indianapolis, IN · Member since 2016 · 26 posts · 15 votes
    9y

    Hi Armand, I'm an Aussie who is investing in Indianapolis. I'm happy to help a fellow Aussie and introduce the local guys I'm using. They are really great and have worked well for me.

    0Reply
  • Federico Gutierrez
    Realtor · Cleveland, OH · Member since 2015 · 2k+ posts · 857 votes
    9y

    This qu is for Kevin 

    Are you buying with cash or were you able to get traditional US financing? That is the biggest qu. Aussie investors ask

    0Reply
  • Account Closed
    Investor · Indianapolis, IN · Member since 2016 · 26 posts · 15 votes
    9y
    Federico, I've spoken to many banks and it is very difficult and probably impossible. Hard money lenders will lend, but at bad rates, high fees and really high deposits. As a result, I have been using creative finance methods namely, seller-financing and cash investors.
    0Reply
  • Gaynor Pendleton
    Investor · Gelorup, Western Australia · Member since 2016 · 13 posts · 4 votes
    9y

    Hi i am a fellow Aussie who is currently investing in the US and also have obtained finance in the US.   It seems near impossible when you first start out, But don't give up it is worth it.  

    Do you need a LLC? - i would say this really depends on your financial situation and the tax benefits you are looking for, and how many properties you have. When we commenced our biggest concern was protecting our assets here in Australia I did not want to take the chance of loosing everything we had worked so hard for here so started with a LLC - which cost $550, all states are different so it will depend on where you are interested in buying property as to where the LLC is set up and you must have an agent in that state there are companies that do this or it could be the property manager. The state has to have a local person to contact if required, and any mail addressed to the LLC will also go to this address which then needs to be sent on to you.

    Do you require a US bank account - Yes - you don't want to have to pay fees for transferring money all the time, once you have a few rental properties generating income, and bills to be paid it soon adds up and all your profits will disappear. Opening a bank account is not as easy as it once was but still can be done, the big banks such as Bank of America, Wells Fargo etc will want you to open an account in the LLC or C-Corp (business account) and a personal account (in your name) which will require a monthly balance to avoid fees just like here! the Personal account is to start a credit rating in the US. Another option is looking at the smaller banks in the state you are interested in buying they are easier to deal with for example: Enterprise Bank & Trust in Kansas. It can be done on line but if possible it is best to take a trip over there and check things out, face to face is always best.

    Getting finance in the US is possible but the rates will be around 6 - 7% and until you have a few properties and a credit rating in the US you will be asked to put down a high deposit, my first was at 50% down, you will also need to work with a broker to achieve this.   

    It really comes down to your current situation and do you have the financial backing to get started, do you require the income now or are you planning for the future.  

    Always happy to chat have learnt a lot since starting, and still learning it is so different to here. 

    Cheers 

    Gaynor 

    2Reply
  • Jonathan Bridge
    Brisbane, Queensland · Member since 2017 · 5 posts · 1 vote
    9y

    Hi, I'm an Aussie too. Look at investing in Indianapolis. Will buy my first property outright with Morris Invest this April once I find a US bank to join up with. I have found it impossible to join one without having to travel to Indianapolis. I also want to find one that will offer finance so I don't need to buy every property outright. Happy to hear all your tips, experiences, woes, success', etc buying in the USA.

    0Reply
  • Michelle T.
    Indianapolis, IN · Member since 2014 · 205 posts · 74 votes
    9y

    @Jonathan Bridge  I am an Aussie living in Indianapolis currently going through this process with a guy in New Zealand wanting to invest here in Indy.  PM me your contact details and I'll let you know what I find out about the process and requirements. 

    0Reply
  • Shane M.
    Investor · Jersey City, NJ · Member since 2015 · 40 posts · 17 votes
    9y

    Hello Aussie members- Just a word of caution: For those of who will be investing with Morris Invest, please due to your due diligence. There are lots of threads about this company feedback on BP. I have personally visited and seen firsthand the type of properties they sell you. They are in run down D Class neighborhoods and the rehabs are no where close to what they proclaim on the podcasts. Needless to say, I didn't invest with them. There are other reputable companies in Indianapolis to work with.

    2Reply
  • Jonathan Bridge
    Brisbane, Queensland · Member since 2017 · 5 posts · 1 vote
    9y

    Thanks for the heads up. I will be a bit more careful before I buy. A red flag went up for me when they started referring people to the 'Fund and Grow' organisation. They offer 0% finance 1st year but pretty close to loan shark rates thereafter. Surely there would be many people over-leveraged by this. I can't see how this demonstrates putting their clients 1st. 

    0Reply
  • Ritch Bonisa
    Specialist · Indianapolis, IN · Member since 2016 · 841 posts · 480 votes
    9y

    Armand,

    I work in project management.  I work with a lot of out of state and foreign investors.  Remote investing and project management can be challenging.  I have a lot of experience.  If you have questions or need referrals or contact info - just PM me.  I'd be happy to pass along what I know. 

    0Reply
  • Ritch Bonisa
    Specialist · Indianapolis, IN · Member since 2016 · 841 posts · 480 votes
    9y

    Dave,

    I know 2 hard money (bridge loan) companies that are willing to lend to foreign investors. Your estimation on LLC set up, etc. is pretty accurate. From my experience it is not that difficult to get everything set up. Many people are doing it. I work with investors every day from Hawaii, Israel, Canada, Malaysia, Mexico, and others. One of the big hurdles is finding the local people to get things accomplished in your target market. If you can find the right people - you can hit on a real winning combination.

    0Reply
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