In the last five years, there has been a significant increase in the population of expats residing in the US. According to a recent report, about 50 million foreigners are already residing in the country, and in the next five years, this number is estimated to reach about 70 million. There’s so much to consider when buying a property in the US, and an investor’s job is to ensure they know everything they can and are looking at every possible angle before making a decision. In most cases, you’ll need to jump through a bunch of hoops and have all the necessary documents to the proper authorities to enable you to buy property in the US. This can be challenging and can cost you thousands of dollars. But here’s the good news – in this post, we will shed light on all those hoops, fees, and taxes.
Laws that Apply to Foreigners
You’ve probably read the endless stream of articles and blog posts about the best places to buy property in the US; however, buying property in the US is not always a piece of cake unless you are using Ofirio with thousands of housing options. To buy real estate in the US, you need to be aware of the regulations and the laws that apply to non-US citizens. These include laws on residency, immigration, education, employment, purchasing and leasing, taxes, and many others. To avoid potential conflicts with the laws, it’s important to take note of all laws that apply to the state or city where you are planning to buy a house. Here’s how to navigate the US laws so you can choose the right one for your needs.
When buying US property, non-US citizens must have a valid US visa to reside in the country. Moreover, you have to show proof of this before you can sign the purchase contract for the property. The type of visa required will depend on your country of origin and whether or not you plan to work in the US. Although a few cities require people from non-US countries to reside in the country for a minimum of five years before purchasing a property, most towns only ask for proof of a valid visa.
You may be eligible for a Green Card if your country does not offer the VWP (Visa Waiver Program). Under this program, applicants must have a valid visa in their passport and have a job offer in the US. If you don’t have an official offer, a business entity is required to hire you for at least one year. However, you may only apply for the program when you’re already a resident or US citizen. The US Citizenship and Immigration Services (USCIS) will conduct background checks on the applicant to verify eligibility.
If you plan to purchase a property, you must be a US legal resident, and you will also have to pay certain taxes to register the property. Moreover, if you have moved to the country permanently, you may need to take some exams to become a resident. The law also applies to renting a house or apartment. The only exception is that you can get a temporary rental permit after establishing your residency. To be qualified as a legal resident, you’ll need to establish a minimum of 90 days of stay in the state or city. If you intend to live there for more than two years, you may need to apply for an official residency permit.
Buying a US home doesn’t mean you have to own it. In fact, most people prefer leasing a property. It will not only give you a hassle-free stay in the US, but it will also help you save money. You’ll need to sign a lease contract with a local property owner or the homeowner to lease a property. Under this contract, you and the owner mutually agree to the lease terms. You will be required to pay a security deposit deducted from the first rent payment. The owner will also expect to make a mortgage payment every month. If you don’t feel that the contract terms suit you, you may have to take legal action to get out of the contract. However, the Lease option is not applicable in certain states, like California. In that state, landlords cannot evict a tenant without a court order. So check what’s allowed in your state before going into real estate hunting mode.
Whether you’re buying a property or renting, you’ll have to pay taxes in the US. You can apply for a tax ID number if you’re an American citizen, and this will help you fill out your tax forms and make your payments. If you’re a non-US citizen, you may have to register for local income tax. You’ll need to supply evidence that you’ve established residency. Furthermore, you’ll have to register for the Social Security Number if you’re self-employed. You can file for individual income tax if you make more than $10,000 a year. As a permanent resident, you will also have to file for your US taxes under the Filing Status Code.
Although buying property in the US is a great option for foreigners who want to start a new life in the country and simply begin their investment journey, it’s not an easy process. So, be prepared to spend time and effort researching what cities are the best for you to buy a home.