So you want to buy a US property?

Let’s look at the due diligence you should do as a novice or experienced investor, this will lead into what steps you need to take to ensure you are getting the best bang for your buck also.

You can also assess current investments with these tips also just to ensure peace of mind within your current portfolio.

Acquisition

1. Is the home on the open market when offered to you?You can tell this quite easily by punching in the address here www.zillow.com

2. Is it a private sale or bank foreclosure?Again this information will be on the above linkIf it is a private sale it can be listed for any price the seller wants to list it for, here is an example.Seller secures a property from the bank for 13k and relists it at 65k, that is legal and unless you know how to read the data on www.zillow.com you could lose a heap of your money fast, I hear these stories all the time.

3. If it is a bank foreclosure you are actually buying it at the lowest price possible if you are dealing direct with the bank.

4. If it not listed on Zillow for sale there will still be data on the property and you can see the past transactions which is public records.

5. Just to be sure don’t accept the estimated values and area stats as gospel

because they are 2-3 months behind and run all the foreclosure sales into account when estimating values and are well off the mark in most cases, just use it a guide.So hopefully that has kept you clear of some transactions!

Purchase

Buying a turnkey property has some positives and some drawbacks, let me explain.In most cases 99.99% we as brokers are offered significant commissions 8% – 10% (5k to 15k) or more to offload US overpriced properties to investors. How do I know this? I get approached all the time myself, find me a fool sell them the dream and rake in an additional commission on top of my upfront fee. YES ALL THE TIME!They call themselves wholesalers or act as a secondary broker based in the USA there are at least 30 that have approached me directly which I have declined them all, many of whom are working with almost every company in Australia marketing US deals left and right.

So now that is out of the way be very careful buying a ready-made investment package from any company at any time and keep your emotions out of the deal, don’t rush anything until you have complete your homework.

After Purchase

Quick vacancy of your new investment lower rental than quoted and poor renovation works if any at all are common practice.Flick and forget, is the general way US brokers work I should know I hear the stories all the time.

Read the fine print if things go south is the company you purchased the property through here in Australia really care once he has your cash if a tenant leaves? NO in the fine print all obligations got to you dealing with it directly with the management company who do give a damn and that’s if there was even a tenant in it in the first place. I have heard and seen first-

hand driving past some of these homes for investors in the US to see them still boarded up. The seller is paying the rent so he can secure another deal before exposing the truth as we are so far away this happens.Recently an investor contacted me she had purchased 3 homes with 2 other companies before meeting me in Michigan to buy her first property with Cash Flow Gold, just catch up to her recently she is try to offload the 3 homes Florida/ Phoenix as they are all vacant and the Phoenix home is in such a bad location she doesn’t know what she will do.

Make the person you are working with in Australia take a role in ensuring what they are selling is actually what they are selling and back it up themselves and not shift it to the US after they have your money!

Finance

In most cases, not all but quite a few where finance is an option the home is so overpriced you have paid for it outright just in you 40% or 60% deposit. FACT!

Additional links to assist you in your homework when buying property in the USAwww.zillow

http://www.finestexpert.com/Home/Index

www.trulia.comhttp://www.nationalrelocation.com/ Just type in the suburb or city here to drill down on area statisticsI have no Doubt this article will ruffle a few feathers however that may bring more attention to it than they need so it may stay on the down low we shall see.

Jason Simpsonwww.cashflowgold.com.auWorking for the investor everyday!Quality – Location – Results – Success

Copyright Warning:

All contents copyright © 2012 by Cash Flow Gold. All rights reserved. No part of document or the related files may be reproduced or transmitted in any form, by any means (electronic, photocopying, recording or otherwise) without the prior written permission of the publisher. You can share and distribute the articles with a link back to the original article.

Original Article Link:

http://cashflowgoldaustralia.wordpress.com/2011/10/06/the-great-australian-rip-off/

Connect with us:

Facebook: http://www.facebook.com/pages/Cash-Flow-Gold/259856807366814

Twitter: https://twitter.com/cash_flow_gold

YouTube: http://www.youtube.com/user/CashFlowGold