by Land Century
You may have heard the reports that foreigners have purchased over $104 billion worth of land and real estate in the United States between April 2014 and March 2015. A new record, this accounts for 8% of all existing home sales in the country
While foreign buyers are going after more expensive land, that doesnt mean others arent buying land as quickly as they can. Asian countries, such as China, Taiwan and Hong Kong, account for $28.6 billion in sales. Canadians purchased $11 billion of real estate, while India purchased $7.9 billion. The remaining money was spent by foreigners from all over the world. But how difficult is it to buy land as a foreigner?
Are Foreigners Allowed to Buy US Land?
The United States is unlike other countries in the fact that a person does not have to be a citizen to buy land. There are no limitations in terms of who can buy land in the United States, but there may be limitations if you were to buy a home.
For example, federal law may not prevent you from buying land, but you may be prevented from buying land from the following:
* Condominium associations
* Community associations
* Homeowner associations
These associations are typically companies or organizations that impose certain rules on a community. For example, these associations may not allow you to build a building of a specific height that would harm the appeal of the neighborhood. And these associations have a lot of power in terms of who is allowed to be a part of the association.
With an association, you cannot be discriminated against because you’re a foreigner. The loophole that these associations use is that a foreigner will be an absentee owner. If you are an absentee owner, the association will not be allowed to impose rules or regulations on you. In essence, the association is not allowed to operate because youre an absentee owner, which means they can stop you from buying the land.
Thankfully, this normally only happens when a foreigner is purchasing real estate; a home, a condominium or another structure. Legally, foreigners are allowed to buy land anywhere they want in the United States.
What Are Foreigners Required to Do When Purchasing Land?
Buying land is typically an easy process. You obviously need to have the finances available to you, and youll need to secure the proper financing from the mortgage company if you plan on buying a house. Many foreigners buying with cash do not have to deal with the strict rules and regulations that banks force on foreigners.
Instead, you just need to provide your basic information:
* The first and last name
* Proof of identification
* Proof of residency in your home country
You also need to remember that you will be required under United States law to pay property taxes. These taxes must be paid, and you must be able to receive your statements in your home country. If property taxes are not paid, youll be required to either pay a penalty, or you may lose the house/land entirely.
Buyers that seek a mortgage will be required to:
* Provide a down payment of at least 30%.
* Provide income documentation.
* Provide bank statements and reference letters.
* Provide two forms of identification.
The lending Institute will need to understand where your money comes from, and a thorough review will be conducted before a loan is provided. Its very important that, if youre buying a home, you have all of this information available.
Buyers who can pay in cash will not need to go through such a rigorous review of their finances. This is what makes buying land especially popular in the United States.
Depending on your nationality, you may need the following:
* B-1 visa
* B-2 visa
Youll also need to be able to provide your passport. Its often best to work with a lawyer that has experience helping foreign buyers purchase land in the United States.
How Do Foreigners Find Land?
Finding land is very simple, and youll use the same avenues that a United States citizen would use when buying land. Youll want to use the following resources to your advantage:
* Real Estate Agents
These professionals will have access to the land and homes, and they may have an attorney that can help you through the foreign buying process. Youll find that a lot of these properties are not as cheap as the other avenues that we’ll discuss.
Land auctions are available, and many of these properties are comprised of land that has been repossessed by the government or lenders. Properties that have been in disarray or need to be sold by the owner may also be included in an auction. The one issue with auctions is that youll pay, as the buyer, approximately 5% commission on your purchase.
* Online Listings and Land Surplus Sites
Online listings are fast and easy. You simply go to a leading real estate or land surplus site, plug in your criteria, and the results are shown to you. Land Century will have a variety of different land options to choose from, at extremely affordable and below average market prices, and youll also be able to view all of the land’s information.
Youll want to pay special attention to:
* Utility access
* Land geography
* Road access
* Property taxes
* Easements and restrictions
* Land type
Many investors will choose to have a representative conduct the land search for them. You may pay someone that will use the land, send you pictures of the property and ultimately buy the property sight unseen. This should only be done with a company that you can trust and have experience dealing with.
This does not mean that you will not need to provide the same proof of residency and identification that you would need to as stated above. Theres also the probability of buying land as a company. Many foreign companies will forge a domestic LLC wherein they keep their property holdings. By doing this, many foreigners are able to purchase the land and overcome the restrictions that cooperatives have in place because they are a legal entity in the United States.
Created on Thursday, December 03, 2015
Updated on Monday, February 26, 2018
by Land Century