Boston locals often find it a challenge to buy property in Massachusetts. As an international investor based in China or Taiwan, distance, language, and cultural barriers can make it even more challenging to buy Boston real estate.
The good news is that Boston is a city with a lot of opportunities. Investors from across the globe are investing in real estate right here in Massachusetts. In fact, many of our real estate investors purchase a Boston property and are able to sell it in five years for a great return.
The US is very friendly to foreign real estate buyers. There are no restrictions or fees when you invest in the US market, broadening your portfolio with fewer additional fees.
What to Expect as a Chinese or Taiwanese Real Estate Investor
Hu Law is sensitive to the unique real estate needs of Chinese and Taiwanese investors. Follow these 5 guidelines to better prepare for your venture in the Boston real estate market.
1. Decide on Your Goals.
What do you want out of this property?
Do you want to purchase a single-family home that you or your family can stay in as you travel? Do you want to purchase a multi-family condominium for passive income?
As a foreign investor, you can buy nearly any type of property in the US. The first step is to figure out what type of property you want to buy, as well as a general location. Keep in mind that the average price for a single-family home in Boston is around $560,000, while condominiums start at $600,000.
The average time on the market for a Boston property is less than two months, so be sure that you’re ready to buy quickly.
2. Get Your Finances in Order.
Before you start shopping for homes, know what you’ll need for financing. While some Chinese or Taiwanese investors prefer cash-only deals, others will need financing. Go through a US-based bank to secure lender pre-approval; this will make the real estate buying process simpler and faster.
Keep in mind that you will also need a higher than non-foreign buyers, around 30%, down payment for the property. As a foreign investor, your bank may require a deposit to secure financing.
3. Partner With Trusted Professionals!
It’s very difficult for you to be in the US for every step of the real estate process. That’s why you need trusted professionals on your side that will fight for you no matter what.
Hu Law is here to make the process easy for Chinese and Taiwanese investors. We can refer you to trusted, culturally-sensitive real estate agents that understand the Boston area. Work with people who are familiar with your needs, minimizing cultural or language gaps that can quickly derail a real estate deal.
4. Get the Property Title.
Hu Law’s real estate attorneys will put the property in your name when the buying process is successfully completed. You don’t need to be physically in the US to gain title to your property, either.
While it’s ideal to be physically present for closing and title work, we understand this may not be possible if you have to travel from China or Taiwan. If you grant Power of Attorney to your Hu Law representative, we can finalize the real estate purchase in the US without your presence.
5. Understand Taxes and Fees.
Although you’re based in China or Taiwan, you will need to be familiar with US taxes and real estate fees. To purchase real estate in the US, you don’t need an Individual Taxpayer Identification Number (ITIN). But If you’re using the property as a rental, you’ll need to pay income taxes in the US on those earnings, then you should obtain an ITIN. You get this from the IRS, but Hu Law can direct you on how to do this. It is important to file these taxes correctly.
Keep in mind that the US also has estate taxes on property in the event of your death. That’s why it’s important to work with your attorney on estate planning to minimize or eliminate estate taxes in the event of your passing.
Hu Law’s compassionate and culturally-sensitive attorneys help Chinese and Taiwanese investors with their Boston real estate transactions. Whether this is your first investment or you’re a seasoned investor, rely on our experience to aggressively protect your interests during a real estate transaction.