a
Print
version

Undervalued Markets. Real Estate Investment in the US

  • 28
America is interesting both for immigrants and investors. In Florida, for example, everyone knows Miami. But this is not the only region that is suitable for investing in real estate. Yuriy Mosha, an entrepreneur and a founder of the Second Passport company, presents solutions on the West coast of the most popular state, in the city of North Port, and teaches us how to make money by buying land and building housing there.

What is Happening in the US Real Estate Market in Recent Months

The situation with the coronavirus in the US is gradually normalizing. Despite the fact that there are some temporary restrictions on movement within the States, foreigners are accepted. And even the temperature on arrival is not measured.

But most importantly, the economy is recovering. We see this in the real estate sector, which has seen a surge in sales. The factor that influenced the growth in the number of transactions is the low credit rate (it always decreases in the run-up to elections). This is about 3% per annum. Plus, the business received good compensation from the government during the lockdown period. As a result, people invest this free money and credit funds at a small percentage in real estate.

Internal migration of the population has also been observed recently. Americans are increasingly moving from big cities to the suburbs or from "overpriced" states where the cost of living and real estate is fair. In this sense, one of the most attractive regions is Florida. The ICG report indicates that in 2019, 950 people moved here every day from the North-Eastern States. And it's not just because of the warm climate…

Why Florida

Low tax

The choice in favor of Florida for Americans and international residents of the States is obvious. There is no state income tax for individuals, regardless of citizenship. No charged on dividends or wages. This fact makes the region attractive for permanent residence.

And in general, taxes are lower here. For example, the local corporate income tax rate is 5.5%, which is about half of the same tax rate in Illinois.

Florida is diverse

When we talk about Florida, most often we mean Miami with elite skyscrapers and a snow-white beach line. But there are many other famous cities. Namely Orlando, Jacksonville, Tampa, Palm Bay. In recent years, North Port has become increasingly popular.

The city is located between Naples and Sarasota, 25 minutes by car from the Gulf of Mexico. The nearest international airports are in Fort Myers, Sarasota and Tampa.

North Port, with a population of just over 70,000 has all the necessary infrastructure for life and recreation. Modern state clinics, free schools, malls and shopping centers with world brands and stores, places for recreation and sports, golf courses, parks, beaches, hot springs and the mineral lake Warm Mineral Springs.

Warm Mineral Springs Park, North Port, USA
Warm Mineral Springs Park in North Port

Low cost of land

This is one of the main advantages of North Port. Here, plots with an area of about ten acres, depending on the location, cost from $12,000 to $15,000 For comparison, in the New York City district of Staten Island, the same plot will cost at least $300,000.

At the same time, land in North Port annually adds 6-7% in value.

Our company helps to invest in local land plots for housing construction with already connected utilities. The land that we sell is owned by us. At the moment, we have more than ten sites, and we regularly update this database.

Plots can be purchased for the full price (from $12,000 to $15,000), or in installments of up to two years. The payment amount in this case will be $500 per month.

To become a land owner, you do not need to collect a set of documents and come to the States. Just send a copy of the first page of your passport by mail. After payment, the transaction is registered in the register within a couple of months and the buyer is given the right of ownership of the land (warrant id).

Additional costs for the purchase and maintenance of land are minimal: $500 for registration and an annual land ownership tax of $400. The land purchase and sale tax is not charged.

The purchase of land plots through our company guarantees that they are not burdened with unpaid taxes, are not pledged to the bank, all documentation is correct, construction is allowed on them, and so on. Our commission does not exceed $1,000.

Low construction cost

In North Port, the construction of a three-bedroom, two-bathroom house will cost from $200,000 to $250,000 on a turnkey basis. At the same time, the house will have all the necessary communications, an equipped kitchen, a refined territory and a neat entrance to the gate. Compared to the same New York City, it is very cheap.

The low cost of construction is due to several reasons. One of them is the cost of labor. The minimum wage for a worker in Florida is $10 an hour, while in New York City it is about $15. Seasonality increases the cost of construction in the Big Apple: it is very cold in winter, so all work is carried out mainly during the warm season. Not in North Port though: construction goes year-round.

If the investor has decided to build a house for permanent residence or rent, we will help you. Over the years, we have found construction companies that can be trusted and whose reputation is time-tested. We recommend them to our clients.

In this case, the investor needs to determine the design (depending on purpose it can be different), but also to prove development company that you have the funds and there will be no delays.

American banks lend up to 60% of the cost of the house to foreigners. The rate is 3% per annum. The maximum mortgage repayment period is 25 years.

The construction period is 11-12 months. The progress and stages of construction are reported directly to the customer. When the house is put into operation, the property is registered to the investor. Thus, the owner will have two documents on hand: one for the land, the second for the house.

As for expenses, in addition to the cost of building and furnishing the property, you must pay a tax on a house with land of about $4,000 annually. In New Jersey, tax deductions for a similar house with land will amount to $11,000-12,000, and in the suburbs of New York City, near Manhattan - about $42,000.

Example of a country house worth $250,000
Example of a country house worth $250,000

Expected demand for land and new housing

Real estate transactions are on the rise in the South and Central-West coast of Florida. According to the DouglasElliman portal, in July 2020, demand for homes increased by more than 260% compared to the same period last year.

In North Port, 1,600 homes have been sold in the past year. With investments of $200,000-250,000, the profit from resale today can range from $20 thousand to $40 thousand (10-15%).

The percentage of revenue is very influenced by the design. Today, European houses are very popular: they have wider windows and door openings, high-quality tiles or parquet on the floor (instead of carpet), etc. Yes, the cost of construction in this case may increase (by 10,000), but the sale price will also increase (by 20,000).

If the investor does not want to build, then it can be held for a while in the property and resold, earning on the growth of its market value (6-7% annually).

You can buy a plot, build a house and resell it remotely. The company already had clients who made a profit under this scheme without a single visit to the US.

Stable income from renting

Another option for earning money via real estate in North Port is lease. In the case of short-term rentals, you can rent the property for $100-150 per day, depending on the season, and for a long time for $1500-1800 per month.

The undeniable advantages of running a rental business here is that you don't need to get a license in North Port and if the tenant is problematic, it's easy to evict them. In New York City, in addition to the fact that there is a complete ban on renting housing for a short time, you can only evict a defaulter through the courts. And the process can take up to eight months.

In addition to the above advantages, it is worth noting that North Port has an extremely low probability of "cataclysms" in comparison with Miami and the East coast, a high standard of living, developed infrastructure within the city, such as new and modern clinics, schools with a high rating, as well as yacht clubs with low parking costs, golf courses and world – famous amusement parks Disney, Universal, LEGOLAND, SeaWorld, Busch Gardens.

The Second Passport company, headquartered in New York City, has been successfully dealing with both migration and investment issues since 2011. The company has more than 300 partners-licensed lawyers around the world and more than four thousand satisfied clients.

If you want to invest in real estate in Florida, the company offers to purchase land plots for further resale or building a house for living or earning income. Employees provide advice and support at all stages.

Contact the "Second Passport" company for more details:
28 Liberty Street, Financial District, New York City, NY 10005
https://vtoroipasport.com/
yurymosha@gmail.com
+1 (646) 477-05-00

Photos: official page of the city of North Port, archives of the company's representative

Quoting conditions of Prian.info materials

Share the link:
Tags: USA, Investment, Real Estate, New buildings and construction

Read also

US home prices have fallen for the first time in six years
Listing prices fell 0.9% annually in June
New York is experiencing its worst housing crisis in 50 years. And this is good news for investors
The portion of available and vacant rental properties declined to a staggering 1.4% in 2023.
Limited inventory and stable interest rates have dragged U.S. home sales to a 13-year low
The National Association of Realtors has published such data for October 2023.
Goldman Sachs believes in the US housing market recovery
The analysts have revised their forecast upwards.
Home Prices in the US Have Fallen Year-On-Year
For the first time in a decade.
Greece changes the conditions for granting a residence permit
The new law will come into force on January 1, 2024. It has already been approved by the government.

Interesting to read

News and articles on the topic «USA»

New York is experiencing its worst housing crisis in 50 years. And this is good news for investors

The portion of available and vacant rental properties declined to a staggering 1.4% in 2023.

  • 23.02.2024
  • 20

Limited inventory and stable interest rates have dragged U.S. home sales to a 13-year low

The National Association of Realtors has published such data for October 2023.

  • 23.11.2023
  • 7