Why U.S. Real Estate Investments Are Getting Attention
As global economic uncertainty has increased recently, many people are looking for stable asset investment. Among them, U.S. real estate investment is steadily gaining popularity. As the center of the global economy, the U.S. has a stable legal system and mature housing and commercial real estate markets, so long-term stable profits can be expected.
In particular, the U.S. is a market accessible to both individual and corporate investors because it provides various types of investment methods, such as rental profitable real estate, commercial building investment, and land development investment as well as actual residential purposes.
a friendly system for foreign investors
An indispensable advantage of U.S. real estate investment is the government’s pro-real estate policy:
Foreigners can also borrow (up to 65% or more) within the United States and invest without permanent residency/citizenship.
Systems such as acquisition tax, multi-homeowners regulation, and transfer gains tax (heavy) are much more advantageous than Korea, and the 1031 Exchange system allows you to defer transfer tax virtually unlimitedly.
Tax burden on property ownership and inheritance/donation is also exempted to the lesser or higher limits.
It also supports investment in the name of the corporation through the establishment of a corporation (LLC) and can receive various tax incentives.
In particular, a significant portion of the investment can be used as **refinancing**, allowing for revenue maximization even as the interest rate environment changes.
Actual investment cases and demand groups
Wealthists at home and abroad seeking stability and diversification of earnings
Parents with children of international students (realization of capital gains in the event of children’s residence/rental and future sale)
a U.S. immigration/long-stay/dispatcher
Investors who felt tired of Korea’s real estate regulations (avoidance of multiple housing regulations and taxation)
Customers looking to form a global distributed portfolio, etc
Unlike domestic investments, U.S. real estate is directly profitable by investors in a variety of ways, including management, operation, market margin, and rental, highlighting transparent information disclosure, institutional stability, and the certainty of real assets.
the way real estate investment in the United States
U.S. real estate investment can be divided into three main categories.
residential real estate investment
You can buy apartments, condos, and detached houses to earn rental profits or expect future market profits.
In particular, large cities such as New York, LA, San Francisco, and Seattle can expect stable cash flow due to steady rental demand.
2. commercial real estate investment
Office buildings, retail stores, distribution centers, hotels, etc.
Recently, investment in distribution centers has been attracting attention as demand for logistics warehouses from large retailers such as Amazon and Walmart has increased.
3. development and land investment
It is a strategy to increase value in the future by purchasing land in places with high potential for regional development in the long term.
However, legal regulations and development plans must be carefully checked.
U.S. Real Estate Investment Procedures
We need some basic procedures to start investing in real estate in the United States.
Market research and investment area selection
You must clearly define the purpose of the investment (rental income vs. capital gains) and then select the region that suits that purpose.
Example: Stable rental income → University districts/large cities/long-term development → Emerging cities
2. Legal and Tax Review
There are no major restrictions on foreigners purchasing U.S. real estate, but various taxes such as acquisition tax, property tax, and transfer income tax are incurred.
It is safe only when consulted by professional lawyers and tax accountants.
3. Utilize local real estate agents and management companies
It is recommended that you utilize local experts to address language barriers and legal issues.
4. Possibility of connection with investment visas
If you invest more than a certain amount, you can even secure your U.S. residency and business opportunities through an E-2 visa or an EB-5 Investment Immigrant Visa.
Advantages of U.S. Real Estate Investment
The U.S. real estate investment market has the strength of managing assets in dollars, the world’s most stable currency. Unlike South Korea and some other countries, which have faced growth limits due to falling fertility rates and excessive regulations, the U.S. is expected to see a continuous population inflow and economic growth, and in fact, real estate prices have recorded a steady rise of more than 5% annually over the past 10 to 20 years. In other words, real estate values continue to rise steadily even in global standards.
The rental market is also very active, and the stability of rental income is also high due to the presence of various demand groups not only local but also international students, immigrants, and expatriates. Monthly rent income is also a dollar asset, which can be expected to have a currency hedging effect.
Stability: The world’s largest stable market
Exchange Profitability: Dollar Asset Retention Effect
Various investments: Customized investments for residential, commercial, development, etc
Tax Benefits: Some States Offer Tax Cuts Even to Foreign Investors
a note of caution
But like all investments, there are risks.
There are differences in returns, taxation, and management methods for each region of investment (city/state/type), so preliminary research and careful selection are required.
Safe investment is possible only when local laws, taxes, loan conditions, administrative costs, and the possibility of exchange rate fluctuations are taken into account.
Before investing, meticulous consulting and collaboration with local experts are recommended.
Therefore, U.S. real estate investment requires thorough preliminary research and expert consultation.
Conclusion: Success Strategies for U.S. Real Estate Investments
Choosing the right region, using legal and tax experts, and a long-term asset management strategy are essential to successfully invest in U.S. real estate. It is more effective if you approach it from the perspective of securing stable rental income and global dollar assets rather than simply seeking market profits.
In the future, the US real estate market is likely to become an investment destination where stability and growth can be expected at the same time. For those who want to run their assets stably in the long run, investing in US real estate will still be an attractive option.