All Forum Posts by: Sam Van Horebeek

@Chris Fortner Welcome!

I am also based in China so it would be great to exchange ideas if you wish. We have a huge amount of foreign investors doing deals in the US real estate market so can share with you. PM me if you like to talk further.

good luck!

@Ryan Dossey 

It is a question on what return you are looking for and the convenience that you are looking for.  For example, we compare the return that a turnkey provider is offering versus having an investor doing it himself.  As pointed out above already, turnkey provider often add a substantial markup to the property that you might not be aware off until you compare with a property that you buy directly yourself. 

Good luck!

@Azam Khan

If you are looking for good cash flow, you will have to stay away from the metropolitan areas and East/West Coasts. We have seen net rental yields of 10-15% in several areas in the US (midwest and south). Each city has their own unique characteristics and advantages/disadvantages so it comes down to your appetite for return versus risk (as well as your timing of holding and budget).

To answer your question around financing, it depends on the amount of budget you are willing to work with. There are a few major banks that provide 50-65% LTV with a rate around 4.5-5.5%. If you have a smaller budget (for example 100K USD), then we have seen a bank providing 59% LTV at 7.25% for 30 year fixed mortgage. Of course, there are hard money lenders out there but I do not know those details.

PM me if you like to discuss (I am in Hong Kong so the time zone will be easy to deal with) - I am actually talking to someone else in Auckland right now so maybe you guys should get in touch there directly.

The time difference, cultural issues and language might be other considerations to deal with some foreign investors. 

Overall, we have seen a range of different activities by Agents in the US:

- Listing agents are promoting listings directly to overseas investors.  The time and language difference is not really being addressed in this scenario but can work fine for some overseas investors.

- Connect with foreign agencies who are dealing with foreign investors in their local country

- Learn something about a foreign culture or a few words in that language as it will show goodwill when you receive that first referral and start the relationship on a good way

- Become active in groups in local community that have strong international connections (e.g. Asian Chamber of Commerces, etc.)

We have seen most success when there is indeed a relationship being built as few overseas investors might be inclined to do business otherwise.

@Deborah Letich 

welcome to BP! There are many foreign investors just like yourself looking to invest in the US real estate market. It can be quite overwhelming as each city/neighbourhood and even street blocks can be very different from each other.  This site offers great insights in many aspects but can still be overwhelming.

Having worked with 700+ foreign investors, I continue to see that most successful investments in the US are done by working with people that you can trust and communicate clearly and professionally with. 

Any local agent/firm will likely tell you that their city, their neighborhood and their property is the best in the US.  Few of them, if any, will look at what you actually want to achieve based on your own risk and reward situation.

Also, before you start going into all the research too much, try to focus on what you like to achieve yourself first. For example, are you an investor looking to make decent cash flow and satisfied with low capital gain, or you are an investor looking for a large capital gain when you sell in 10 years and you don't care about cash flow? These are very different objectives and this will help you in narrowing down the choices of cities to look in. Another factor is risk (which includes risk to your property or risk to realizing your investment numbers). 

Going to this strategy of risk/rewards upfront will help you quickly focus on a few cities/areas and then you can go into much more detail and talk to the right person on the ground. This is the process that we have seen foreign investors going through successfully. 

hope this helps a bit

@David Bila

Welcome! I am also based in China so feel free to drop me a message. We are organizing meetups and webinars for Asian investors of US real estate. 

Good luck

Great discussion here - I would like to add a few thoughts on the Chinese buyers from our perspective here in China:

- Most Chinese are buying real estate in cash. They do this both domestically and overseas.  As such, there is limited risk for defaults by Chinese families on their mortgage as we have seen in the US during 2009 crisis

- Asian investors love San Francisco for a variety of reasons (diverse set of industries, good climate and air, great schools, diverse community,...)

- Real estate prices in San Francisco are still relatively cheap compared to some cities in China

- The economic situation in China is challenging at the moment. The volatility of the stock market certainly does not help. As a result, there is more demand from Chinese for overseas investment products and overseas result.

Based on the all factors above, I think San Francisco will continue to see an influx from overseas Asian investors over the next years.  However, as someone pointed out above, the majority of the transactions are still done by the local Americans so it is more important to assess how the local economy and drivers are affecting real estate than what overseas buyers are doing in San Francisco.

@Denis Clijsters

Goed om een Belg te zien op dit netwerk!

We have been assisting foreign investors with their acquisition of US properties - many of those properties are buy and hold. I am not sure whether I fully understand your question around foreign mortgages but I do know that some US banks provide loans to foreigners. Or are you planning to refinance your properties in Belgium and use the cash to invest in the US?  Feel free to message me directly and we could chat. Good luck!  

@Imadeddine Aziez 

I would say that it depends on the type of overseas investors. Many of our Asian investors are buying US properties for long -term appreciation. They prefer to invest in high-quality areas in gateway cities - they don't necessarily think about using those houses as vacation homes.

Another segment of overseas investors is very keen on high-yield properties in second tier or third tier cities in which they can make 8-10% net rental yields.

And yes, as you mentioned, some of our overseas investors are keen on commercial properties but obviously a much higher price point.

@Eugene S. fyi - I meant Indiana and not Indianapolis