With the current increase of interest for Chinese investors in US Real Estate, Parc Bay Real Estate is here to guide you through the home buying process and provide you with essential information. We designed the following guide to help make the U.S. real estate experience as stress-free as possible. Here at Parc Bay Real Estate, we know that purchasing a home is one of the biggest decisions a person can make, resulting in many questions and concerns. That’s where we come in!
This three-part guide features useful information and tips for Chinese investors looking to purchase U.S. real estate. Our dedicated team is well-equipped to assist Chinese investors every step of the way. We will provide you with topnotch service for an amazing U.S. home buying experience!
Part I: The Differences in U.S. Real Estate and Chinese Real Estate
The main distinction between property ownership in the U.S. vs. China is that property owners in the United States own both the building and the land on which it’s situated on. Homeowners are for the most part able to do with the land as they please, with a few regulations here and there of course. In China, however, people own their real estate but not the land on which it sits. The land is instead owned by the government or a collective. Furthermore, Chinese owners only have rights to the land for a specific number of years, while American owners have rights forever.
In regards to property taxes, both countries have them, but in China, property taxes for private homes are usually paid during the transaction process. In the U.S., property tax laws vary state to state. For example, in some States property taxes are paid quarterly. These taxes help cities and towns pay for important public services including schools, parks, infrastructure, and libraries. Owners pay these taxes to the city or town in which the real estate is located and are based on the amount of tax income needed in the budget.
Part II: Find an expert agent in local market
It’s important for Chinese investors to know that purchasing real estate in the U.S. is slightly different from purchasing in China. The first step is to decide what area you want to live in. It’s best to have two to three towns in mind. Next, select a real estate agency to represent you. Local firms like Parc Bay Real Estate are an ideal choice since we have in-depth knowledge of our local market. We can assist you in making well-informed decisions. In fact, local agents know important details like where to find amenities, such as parks and shopping, which neighborhoods are closest to the public schools, and which quiet streets turn into busy commuter routes.
Another important part of the process is to establish your working relationship with an agent. Having one agent whose job is to represent you exclusively is the best idea. Sometimes people are hesitant to do this, but it’s important to keep in mind that agents share listings, so you will have access to every house on the market no matter who represents you. Having one agent also means that he or she will work relentlessly for you, making sure that your needs are met first and foremost. Without the concern that another agent will get the commission, your sole agent will focus completely on you.
Part III: The negotiations and the sign
Next, you’ll want to discuss your needs with your agent and then start viewing potential properties. Also, before you make an offer on a property, you will need to get pre-approved for a mortgage. It’s a good idea to get a pre-approval letter from a mortgage lender. Once you find a property you like, your agent will work with you to come up with a good offer. Unless the seller accepts the initial offer, there will be some back-and-forth negotiating. A good agent who knows about the local negotiating culture and practices is a vital resource for Chinese investors during this process.
Once you and the seller agree on a price and terms, you will then both sign the offer. When you sign the offer, you have to make a deposit generally between $1,000 and $5,000. Before you finally close the sale, there are a few other steps in the home buying process, including a home inspection and getting your mortgage pulled together. The U.S. real estate professionals at Parc Bay Real Estate can guide you through every step of this process.
Part IV: Property Types in the U.S.
There are many different types of U.S. real estate. The following is a brief explanation of each kind:
- Single-family home: When people think of typical U.S. homes, this is usually what they have in mind. A single-family home is one building meant for one family, situated on a privately-owned piece of land.
- Multi-family: Most homes in major Chinese cities are in multi-family developments. A multi-family property is simply defined as a building with two or more units. This can come in the form of a townhouse (a multi-unit building where the houses are attached side-by-side), a duplex (one building with two residential units in it that can be side-by-side or one on top of the other), a condo (a unit in a multi-family building or development that is privately owned and used), and an apartment (a unit in a multi-family building or development that is rented to a tenant).
This brief but information-rich guide is a great first step for Chinese investors interested in U.S. real estate. The experts at Parc Bay Real Estate can further assist you in your real estate journey and answer any additional questions you may have. Please contact us at 415-370-3776 or by email at info@parcbay.com. An amazing home buying experience awaits you!