Owning a property in the USA is the latest trend in Australia. Since 2007, the bursting of the USA housing bubble, the foreclosure rates have significantly increased and led to big economic crisis in the USA. Meanwhile, the Australian dollar has become one of the strongest currencies in the world, which was a reason for growing number of Australians willing to invest in real estate in USA. Today, there are many affordable houses for sale in USA, some under 100K that are actually worth the investment.
While the process of buying a home may be a very exciting experience, it is a long and exhausting process, because it involves more than you may think. If interested in investing in real estate USA , here’s how buying houses for sale in USA works.
Find A Good Real Estate Agent
Although you may feel like you can find a good property deal on your own, with the help of Internet of course, hiring a real estate agent is by far a better and more secure option. It’s true that searching online for all listed houses for sale in USA is a no-brainer, aside from exterior you cannot really find out every single detail about particular property using the Internet. On the other hand, an experienced realtor (especially the one that has experience with real estate USA), will be able to fill you in with all major details. These professionals know the process of buying a property in detail, all the paperwork and understand the American market well. So by hiring one you’ll certainly be in a favored position. Instead of looking for houses for sale in USA offers online, spend the time to find a reliable real estate agent, because he/she can help you complete the process quicker and successfully.
The first step of investing in real estate USA is knowing how much you are willing to spend on a house. While you may have enough to afford a house in the USA (thanks to years of saving), do what most Australians do – get a mortgage from a bank and pay the loan off in fixed monthly payments. Of course, try to work out the best loan deal, including favourable interest rate. If you hire a real estate agent who offers real estate USA service (which is strongly recommended), he/she will contact one or more US bank to get mortgage pre-approval.
It is a lot of work for you, but not for a real estate agent. The bank asks a lot of questions concerning your finances in order to estimate how much you can pay each month. But keep in mind that monthly mortgage payment is just part of your total ‘buying a house’ expenses. Keep in mind that you’d have to make a down-payment (20% of the price), at least to secure your offer. Also, the monthly payments do not cover some other additional costs.
Set Home-buying Priorities
Before you begin your online real estate in USA adventure of finding that dream house, set your priorities. First decide on the size of the house. Do you want a two or more bedrooms, two bathrooms, basement, garage, driveway, a back yard, a swimming pool, concrete floors, etc.? Although all these matter, the most important and deciding factor is location. You may want to buy a house in the area where crime rate or/and tax rates are low, or a house in a more natural environment, or one that is near a good school, college or university. By listing all your home-buying priorities, you will definitely spend less time on going through all listed houses for sale USA and will be able to focus on the ones that match your requirements.
With or without the help of a real estate agent, the next step is house hunting. Finding a house that meets your requirements will be much easier once you have set your priorities and you know what you are looking for. Do the search together with your realtor. Why? While you may get an idea of how the house looks like by looking at the pictures posted online, the real estate agent will be able to provide you with more important information concerning the condition of the house.
Make An Offer
Once you have found the right house, which meets all your criteria, including your budget, it is time to make an offer. So, here comes the most interesting part of it all – how much are you willing to offer for your dream house in the USA? Remember one thing, regardless of how much you are in love with particular property, make sure you do not go over your budget. Make a reasonable offer, not too less, not too much. However, your offer may not be final, you can negotiate the purchase price with the seller.
Negotiate The Purchase Price
American sellers rarely accept the initial offers, so be prepared to negotiate the purchase price. It is really important to stay within your budget or mortgage pre-approval letter during the whole negotiating process. If you cannot pay the price the seller asks for, don’t let your emotions guide you as you may make the biggest mistake of your life. It can all end up in bankruptcy or foreclosure. If you cannot afford it, don’t buy it. It’s simple as that. If the seller doesn’t accept your highest offer, just walk away. There are other houses for sale in USA that will fit all your requirements.
Have A Home Inspection
When investing in oversea properties, it is extremely important to have a home inspection done to ensure the condition of the house matches its price. You surely don’t want to end up a victim of a fraud. The inspector will check the foundation of the house, the construction, the plumbing system, cooling and heating systems, the electricity and some interior points. Once he is done, you will get a printed inspection report listing the things that require repairs. This report may help you renegotiate the purchase contract to include repairs, since most sellers are willing to pay partially for the repair costs.
Seal The Deal
Now that you have had a professional home inspector conduct a thorough report of the true condition of the house, it is time to move on to the final step – closing on the deal. Remember, this may be one of the most important days in your life. Financially speaking, of course. Usually, at the closing, buyer and seller meet and sign required papers. This may not be the case with you. Because you are investing overseas, closing, as everything else, will also be done remotely. But this does not mean you will have to go over less paperwork, or come unprepared. Make sure your agent and you have all documents gathered to prevent any misunderstanding, any unintentional mistake that may cost you your investment. The documents you must have are:
- proof of your down payment (must be in a form of a certified check);
- a letter proving you have homeowner’s insurance;
- certified check for closing costs;
- settlement statement (list settlement costs and who is responsible for what);