Real estate in the USA - the fine print

#YazmatTheShavuot to Elia Horesh #post3

A lot of people go into their investment knowing that here they have a house, find a tenant, and let's make a mess.

In the business plan, they reduced insurance fees, management fees, maintenance and vacancies, and here we got a cool return, and one day at most we will sell.

So that's it, the reality is a little different????

Real estate in the USA is not real estate in Israel.

There is a different legal system, a different taxation system, a different construction, and a different climate.

Each of the things here affects the investment, and it is important to understand that.

Some examples-

Legal aspect - when there is a lien on the property, mercifully, and boom, the sale is stalled, and here is an unexpected expense ahead of you

Taxation - inheritance tax (I know, you are young and beautiful)

Construction - a foundation problem for example

Climate - snow damage that we will not know

These things do not exist in Israel.

In addition, there are additional costs that need to be paid-

1. Issuance of an ITIN (for a person and not for a property)
2. The cost of opening an LLC (don't forget the EIN and operating agreement, articles)

3. The cost of opening a bank account in the name of the LLC

4. Annual cost of a registered agent

5. Cost of lease renewal

6. rental registration fee- not in every area, but you should definitely check

7. If the property is a condo then HOA payment

8. The cost of mowing grass, removing snow, garbage, etc.

9. Purchase of appliances

10. Municipal taxes, state taxes

11. The cost of an annual accountant - in Israel (which already means dealing with the income tax. It is not sure that it is suitable for everyone. In some situations it can also eat up the entire return!)

Something that is more difficult to include in a business plan, but it is worth considering, is that we (at least most of us) are Israelis who work with dollars ????

Therefore we are exposed to changes in exchange rates, for better or for worse of course.

But what is certain, we will always have to pay a conversion fee and a transfer fee as well.

That's it, have you decided to sell?

talk to me first ????

But here are some more points you should know-

1. Brokerage cost - apart from 6 percent of the sale price (not long ago I spoke with an investor lender who did not know this, lol)

2. Is it true that the title closes all our debts in the sale? So it's not! Did you sell the property? Make sure you pay gas and electricity bills, it's your responsibility.

3. There is a situation where you will have to sign a notary + apostille (depends on the title you are working with)

Now that's it, I'm done with the bass.

If there are other small letters that I forgot, or something unique to your area, I would really appreciate it if you added them!

in the picture-

My closing, which was delayed by a month because of a nice title that insisted on a notary and an apostille upon purchase (!) in a winning combination with holidays

A gift tip from me - don't work with harvard title