Can foreign people invest in real estate in the United States?

Dec 14, 2022

If you are a person living outside the United States and want to invest in real estate, you may wonder if you are trained to do so. Here are all the details.

The housing market is booming in the United States, and that means more and more foreign investors want to buy properties here. Some people will be surprised to learn that there are no greater restrictions for foreigners to invest in real estate in the United States. However, there are some limitations and rules you should know before purchasing a property.

The first thing you need to know is that if you are not a U.S. citizen or permanent resident, you must have an interest in a U.S.-based company or corporation in order to purchase a property here. This means that if you are going to invest directly in a property, then it must be owned by your corporation or LLC (limited liability company) which is headquartered within the United States.

There are also other requirements for foreign investors when purchasing property in the United States:

  • You must maintain an active role within your business once it is established here
  • You may not transfer ownership of assets abroad without IRS approval
  • You must report annually the income generated by these investments

In that sense, the United States offers incredible real estate investment opportunities in the country, from capital appreciation to the stability of this asset class.

Limitations on investing in the USA while abroad

There are several limitations to the ownership and/or acquisition of real estate in the United States by foreigners. The following summarizes applicable federal laws that may affect foreign persons’ ability to acquire real estate in the United States:

Tax Law on Foreign Investments in Real Estate (FIRPTA). FIRPTA generally applies to sales or exchanges of U.S. real estate interests by foreign persons, including nonresident aliens and foreign corporations, except for certain limited exemptions that may be available under other provisions of the Internal Revenue Code (IRC).

Expat Tax Act (ETI). ETI generally applies to a “covered expatriate” who has an average annual net tax debt for income tax during the five fiscal years prior to the expatriation date that exceeds $161,000 for 2008 or later years; or whose net worth on the expatriation date exceeds $2 million.

The United States is a great place to invest in real estate. However, it is important to consider all of these restrictions on who can purchase properties in the United States.

Types of Real Estate Investments (Real Estate)

Real estate investments can be a great way to grow your wealth. There are many ways to invest in the United States, including buying rental properties, commercial real estate and land.

Investments in rental properties

Property rental is one of the most common types of real estate investment. By purchasing a rental property and renting it to tenants, you can earn income from your investment. There are many different types of rental properties, including single family, duplex, triplex and quadplex homes. And they can be rented or used as a second residence for the owner/investor.

These properties can be found in almost every city and U.S. state, but have different features depending on their location. For example, a condominium in the state of Florida would have much more value than a condominium in a rural area of Texas, because there are more people who want to live in Florida than in the rural area of Texas.

Commercial Real Estate Investments

Commercial properties include any property that is used for commercial purposes, such as office buildings or warehouses. Commercial properties are typically acquired by companies with higher budgets than those seeking residential properties. Commercial real estate has lower rates of return compared to residential investments, but they also have less risk because they tend to be less expensive than residential investments.

Income producing properties are a broad category ranging from a rental home to an apartment building full of tenants paying a monthly rent. Income-producing properties are typically acquired by income-seeking investors rather than capital appreciation.

Land Investments

Land investments differ from other types of real estate investments because they do not include any building or improvement on the land itself. Instead, investors buy undeveloped land with future development or resale plans at a later date, when prices rise due to demand in a particular area.

The type of property you choose will depend on your personal preferences, but there are some general features that can help you decide which type of property is best for you.

In short, there are many different ways to invest in real estate, and each investment has its own advantages and drawbacks. The type of investment you make depends on your risk tolerance and goals.

Investing in BAI Capital is investing in the United States

With a presence in real estate in the states of Florida, Texas and New York, BAI Capital specializes in generating value from land acquisition to the development of mixed-use projects such as senior residences, student residences, multifamily rental and mixed-use buildings including condominium and retail.

Our mission is to safeguard partner capital and equity under minimal risk exposure. With secure development and going through all stages: land purchase, urban zoning adjustment, commercial vision in architectural development and work permit management. We then take charge of capitalization, construction and exit with return of capital and earnings to partners.

In this way, we guarantee fixed and stable returns for your customer portfolio. In addition to having a confidential work protocol with encrypted web forms. Use of protected personal data and private encounters with our agents throughout Latin America.

You know who can invest in real estate in the USA. If you’re looking to protect your capital from inflation through dollar-return investments, or invest in projects that qualify for the EB-5 investor visa to get a Green Card, fill out our form and an agent will contact you.

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