After read this article “Not easy to hunt for cheap houses in US” published by VietNamNet, see below, I wonder how the foreigner can buy the house in the US.
7:23′ 13/05/2009 (GMT+7)
VietNamNet Bridge – High house taxes have made many Vietnamese people waver over their plans to purchase houses in the US.
The house tax rate in California is 1% per annum, while in Houston, Texas, a medium-class house may be taxed $8,000. If people get profit from selling houses, they have to pay the income tax of 15%. The high tax rates have forced many Vietnamese people who are hunting for houses in the US to reconsider their plans.
Many Vietnamese people want to purchase houses in California for two important reasons. First, this is a state where many Vietnamese people live, and second, the state sets a ‘soft’ tax rate in comparison with other states, just 1%. However, the ‘soft’ tax rate is still considered high in the eyes of Vietnamese people.
Bich Lam, the owner of a fabric stall at Soai Kinh Lam Market in HCM City, related that she had returned from a trip to the US in March to learn more about the real estate market and the laws.
“I really wanted a house with four bedrooms and swimming pool, a house with very good interior design in California, priced at $350,000. My husband and I decided to buy the house, but we later cancelled the plan after we realised that the owner of the house would have to pay $3,500 in tax a year,” she said.
Lam went on to say that in fact, 1% proves to be not the final tax rate. It is still necessary to upgrade infrastructure of the area (upgrade the water supply and drainage system, build more schools, parks, public libraries). Lam says that once the infrastructure is upgraded, the tax rate may be double, 2%.
Some people who plan to purchase houses in Houston, Texas have also become hesitant. A medium-class house here has to bear the tax of $8,000. And if the owners sell the houses within two years of living there, and if they get profit from the deals, they have to pay a 15% tax.
“The barriers in language, culture and law may put Vietnamese people at a disadvantage,” said Hoang Ha Thanh, Deputy Chairman of The Millennium Global Solutions Group.
Thanh said that first off, people should know for sure what they want, real estate for accommodation (houses, apartments), commercial real estate (houses, buildings for lease, supermarkets) or real estate for industrial purposes (workshop premises, developed land).
Thanh has advised people to pay more attention to the geographical positions of the real estate, California, Florida, Boston or Houston, because every state has its own laws on real estate management. The tax rates prove to be quite different for different kinds of real estate.
According to Ngo Thi Xuan Binh, Director of Interland Real Estate Floor, additional procedures may lead to changes in the value of real estate. For example, in areas with no schools and parks, buyers will have to pay 1% in tax per annum. Meanwhile, the tax will be $3,000 or higher for houses in areas with good infrastructure facilities.
Despite the high tax rates, experts still believe that it is now the right time to purchase houses in the US, which have dropped to a record low. A lot of US people are trying to sell houses; advertisement pieces on houses with discounts of 50% can be seen everywhere. It is now not only a dream for Vietnamese people to own a house in the US, it is a realistic dream.