NAFTA real estate agents buying like crazy here.

Discussion in 'Politics, Religion, Social Issues' started by 63dot, Mar 21, 2010.

  1. 63dot macrumors 603

    63dot

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    norcal
    #1
    What I used to see in the 1980s with Japanese investors buying into the United States (as our soft auto industry, musical instrument manufacturing business, and real estate markets, etc) now has turned into Canadian and Mexican money as the players.

    I can't speak for other states, but California has been hit fairly hard by this real estate crisis, and I am starting to see some very sharp Canadian and Mexican investors coming here.

    Is anybody involved in this big land grab, and how could somebody like me, a non real estate agent, get involved?

    Thanks in advance.
     
  2. flopticalcube macrumors G4

    flopticalcube

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    #2
    My brother (Canadian) and a few of his buddies are buying houses down in Phoenix for 50c on the dollar replacement cost. The land is coming free.
     
  3. GoCubsGo macrumors Nehalem

    GoCubsGo

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    #3
    Asking how to get involved in real estate here is like asking for stock tips at 2 am on the way home from a bar ... drunk. In other words it's kind of a bad idea.

    But here are the basics.

    Know your comparables:
    Know what other homes in ready-to-sell condition will sell for and buy low. You want to look at the cost to purchase, the carry costs (monthly payment, insurance etc while you're repairing and waiting to sell), and cost to repair.
    Buy according to all of this.

    Know your limits:
    Your first flip (I am assuming you're looking to flip) should focus on something with some repairs necessary, perhaps some space planning, but nothing huge. Expect that your first flip will likely yeild profits lower than what your next flip will yield. Like any new venture you need to "train" and learn how to get things done.

    Attempt to pay cash if you can:
    A cash sale will likely result in a better deal. However, some houses sold by banks are sold as cash deals only because financing wouldn't be available. If this is the case, run away until you've been doing this a while because that means there are repairs that are required to make the house habitable.

    Do not use your life savings to get into the real estate business. At the very least finance the first property and build your little empire from there. If your intent is to buy and rent then get that done as well. Ensure though that you have a cousin because if you think the housing market in California was affected by the rescission then wait until you find out how renting was affected.

    Finally, expect to make a profit, don't expect to get rich and sit around on your ass. Whether you buy, repair, sell or buy, repair rent (foreclosures often need repairs ... if the house payments suffered surely the maintenance did as well), know that you're going to have to work. Like any "new" business expect the first year to be rough, if not the first two years.

    I for one would buy just under market and rent. I would buy properties that needed paint, carpet, etc and carry them as rentals. That'd be my focus as flipping a property could turn into a vacuum for your cash. Some flips can be attributed to boat ownership, boats are black holes that you throw your cash into. I've owned a boat and can attest to this. ;)

    On a side note, "Mexicans" have been in California for decades at least. I think the thread title should read something along the lines of "Foreign Investors ..." sounds a bit better.
     
  4. 63dot thread starter macrumors 603

    63dot

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    #4
    Thanks for the tips.

    With the ten years I have been here, I have actually received great tips on both Mac related topics and non Mac related topics like these. I hope to hear from real estate agents from Canada and Mexico.

    I am an accounting person, but in audit and not taxation. I know there are tax benefits and incentives for foreigners buying real estate in California. President Obama has met with Canada's PM and Mexico's President to spur investment into the US and I assume this is just the tip of the iceberg.
     
  5. rdowns macrumors Penryn

    rdowns

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    #5

    Don't buy the icebergs. They're melting.
     
  6. 63dot thread starter macrumors 603

    63dot

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    #6
    Part of me thinks this way. I have been a shy investor and so far that has been to my advantage.

    I think there might be something here with NAFTA and real estate. There was a blurb on it on CNN but I didn't quite understand the details.

    The funny thing, it's so much easier for me to tell when there's a bubble and it's time to get the heck out. I knew dot.com was going to take a hit (but so did pros in the business for a couple of years before with their gloom and doom) and real estate coming back down to earth was a no-brainer.

    The real trick is to know if certain areas in hard-hit California have hit their bottom (SACTO, central valley, San Diego, etc), or if there is still going to be more movement downwards.

    I tried going through a very large PDF on foreign tax incentives for real estate bought in the US by foreigners under NAFTA but the thing was hundreds of pages long in legaleze with a ton of references in legaleze.
     
  7. Desertrat macrumors newbie

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    #7
    A good many upscale Mexicans are leaving Mexico because of narcotrafficante violence.

    As far as real estate, take a look at what sorts of residences are proving popular. Buyers might not be all that interested in fixed-up fixer-uppers.
     
  8. Sydde macrumors 68020

    Sydde

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    #8
    Actually, they can be a pretty good investment. Sell the melt water as "Penguin Pure - Climate Change in a bottle (It's Open Source!)".
     
  9. flopticalcube macrumors G4

    flopticalcube

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    #9
    Most of the ones I have seen are 2-5 years old in new developments that were half finished before the builder went bankrupt.
     
  10. 63dot thread starter macrumors 603

    63dot

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    #10
    The trend I saw was they were buying, fixing up, and selling, in a fast paced auction environment. Buy low, sell low.

    I called a Canadian real estate company and they said American real estate agents were getting Canadian citizenship. I am not sure how much that can save, but in volume it must be worth dual or losing US citizenship.

    But less and less these days, that means as much. I do see the incentive for middle class Mexicans getting out of a dangerous cartel area and moving to California. I don't know how much of the cartel violence is real and how much is for a news story and ratings. People I know who have a house down there say it's way overblown. CNN gets that way. Remember Y2K, SARS, the flesh eating virus, and H1N1?
     
  11. CaptMurdock macrumors 6502a

    CaptMurdock

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    #11
    It may depend on which side of the San Andreas Fault they are buying....

    "Son, stocks may rise and fall. Utilities and transportation systems may collapse. People are no damned good. But they will always need land to live on, and they will pay through the nose to get it!"
     
  12. Jaro65 macrumors 68040

    Jaro65

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    #12
    Coincidentally, a couple of my friends across the border did ask about buying a real estate in the US. I didn't think too much of it, but this may appear more popular than I thought.
     
  13. Rt&Dzine macrumors 6502a

    Rt&Dzine

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    #13
    A mentionable number of American realtors are getting Canadian citizenship? I was under the impression that it's not that easy to get.
     
  14. Jaro65 macrumors 68040

    Jaro65

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    #14
    That one made me wonder also.
     
  15. Queso macrumors G4

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    #15
    The thought of buying investment property in such an active Earthquake zone would utterly terrify me. Best of luck to them.
     
  16. 63dot thread starter macrumors 603

    63dot

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    #16
    I thought it was the other way around.

    Anyway, during the 8 years of Bush and company, and the thought of Palin taking over right after President McCain keeled over made me think of Canada. Luckily, fate stepped in and we won't see a President Palin anytime soon.:D
     
  17. Macky-Mac macrumors 68030

    Macky-Mac

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    #17
    get your real estate license and start advertising your services in canada and mexico :cool:
     
  18. Rt&Dzine macrumors 6502a

    Rt&Dzine

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    #18
    It'll be at least 4 years before applying for citizenship unless they've already been living there.
     

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