Being Australian should not limit you to investing in Australian assets. United States is a major investment destination. This is great news for Australians who are looking to invest in US property, as owning USD assets works as a hedge against a falling AUD. The first rule of investing is diversification, and US real estate is an excellent way to achieve that. With diversification, you can increase your returns, while smoothing any losses, and reducing risk. There is also a way to invest in real estate and benefit from the cash-flow, which comes from renting out that real estate without the aggravation of managing tenants and fixing broken pipes in the middle of the night.
As with any investment, stocks, bonds and buying and selling apartment buildings, there is a risk that the value of your investment will go up or down. That said, it has been shown that historically, real estate values have appreciated. That means, as a long- term real estate investor, you are likely to increase your returns by putting part of your cash in real estate investments. Remember, this is not investment advice, and prices can go up, go down or remain the same.
Here are 7 secrets to buying property in the United States.
An average two bedroom unit in Melbourne, Sydney or Brisbane will cost in excess of $450,000. An average three bedroom house can be purchased in the United States for $50,000. That is 9 times less.
To purchase a property in Australia, you will require a deposit of at least $90,000, plus ѕtаmр duty and other соѕtѕ. This means that you can purchase an entire home in the United States for much less than the deposit of a home in Australia.
It’s not just the entry price that is more attractive. Rental returns on United States properties are much higher than found in Australia. The return on a $450,000 property in Australia would be considered “good” if it hit 3% (net). However rental rеturnѕ on a property in the United States can be well over 10%, and up to 15% реr annum(net).
Our next secret is location. We have heard it all before – Location, Location, Location. Location is important in all markets around the world, and cities like New York, Miаmi, Bоѕtоn, Los Angеlеѕ, Sаn Francisco and Sеаttlе can ѕhоw similar growth and рriсеѕ tо thаt оf Sуdnеу, Brisbane or Mеlbоurnе.
So, for this purpose, we have to look elsewhere. The mid-west states have some fantastic markets with some prosperous large cities. In these locations, it is possible to generate great саѕh flow returns with our low purchase price.
It is widely believed that the best locations to purchase low price but high return homes are cities with strong employment growth. Some of those areas identified include Detroit, Florida, upstate New York, Ohio, Tennessee, Texas and even Alaska.
Detroit, in particular, represents one of the strongest housing markets for foreign investors. The enormous potential for growth, high domestic rental market and housing affordability all combine to make Detroit an ideal opportunity. Additionally, elevated levels of investment by government, and a flourishing local industries all help to ensure a bright future for the region.
It is difficult for a “first timer” to be able to achieve a property purchase in a new country and expect it to go smoothly. Knowing where to purchase, the local taxes and regulations are just the start. Then you need to consider property management, banking relationship and accounting considerations. Perhaps a broker or partner will save dollars and reduce headaches. Star Dynamics Property Investments (https://www.stardynamic.com.au/) is an Australian company helping other Australians get great quality, high cash-flow investments in the US property market. They do this by working with teams of professionals on the ground in various regions of the US that have taken years to develop. This ensures that all properties are handpicked, in a great neighbourhood, renovated to high rental standards, and occupied by pre-screened, dependable tenants. Your network can handle all the day-to-day processes.
Exchange rates fluctuate for any number of reasons. Government policy, economic outlook, sanctions and inflation are just the start. You will need to be aware of different exchange rates to make sure you get the most out of your AUD when sending overseas. For example, to purchase a property in the United States at a cost of $50,000 USD, you would need to contact your bank and send the equivalent amount
Would you rather have to send $72,000 AUD or $68,000 AUD in order to buy the property in the United States for $50,000 ? If you use a bank, it will cost you $72,000. If you use Instant Global Payments, it will cost you $68,000. So you will save $4,000 on the initial purchase price.
And then the ongoing returns of (say) $5,000 USD per annum return has to somehow get back to your Australian bank account. Now, you could use a bank for that, and at the current market rate, you would receive $6,600. By choosing a specialist money transfer business, you will not only save money, but have a more personal experience. Using Instant Global Payments, the same $5,000 USD would convert to $7,002. $400 AUD better than using a bank.
Regardless of where you need to send your funds; Instant Global Payments can help you send money from Australia. We pride ourselves on giving our customers world-class exchange rates, we challenge you to compare the exchange rate we offer you to your current provider, we are confident that we will be offering you a better rate.