Thanks to the lease, I was able to recoup the purchase of an apartment in Miami in 10 years

Rental business in the resort region, where the sun shines 365 days a year, is very profitable and allows you to quickly discourage investment in housing. For comparison, Moscow, which, according to its rental rates, can also be considered a paradise for a rentier, makes it possible to return investments for at least 14 years and then with a competent approach and if an apartment does not stand for a month without tenants. However, a competent approach is needed in Miami. Natalya Peysina from St. Petersburg on a PERSONAL EXPERIENCE has tested the validity of this phrase and is ready to share with readers of RealEstate.ru useful tips on investing in housing in Florida.Rental business in the resort region, where the sun shines 365 days a year, is very profitable and allows you to quickly discourage investment in housing. For comparison, Moscow, which, according to its rental rates, can also be considered a paradise for a rentier, allows returning investments for at least 14 years and then with a competent approach and if an apartment does not stand for a month without tenants. However, a competent approach is needed in Miami. Natalya Peysina from St. Petersburg on a PERSONAL EXPERIENCE has tested the validity of this phrase and is ready to share with readers of snow-vostok.ru useful tips on investing in housing in Florida.

How did you choose a city for residence?

– Natalia, why did you decide to leave Russia to the USA? 

– My relatives lived in America for a very long time, and I always wanted to see them. In addition, I wanted to look at how other people live, to travel. I myself am from St. Petersburg and madly in love with my city, but I always had a dream to live in a paradise of the world with a climate where the sun and the warm ocean 365 days a year! Plus, I took into account that America is a state that provides an incredible amount of opportunities to achieve any heights in different areas of activity. That is why I chose a wonderful state with a wonderful climate – Florida. 

– What were your main criteria on which you relied when choosing a place of residence?

– First of all I wanted to be near the ocean and in a safe area. So I found the city of Aventura, which is located not far from Miami and just 5 minutes by car to the beach, and bought my first apartment there. Aventura is a quiet, safe, insanely well-kept area with many restaurants, schools, shops and various entertainment complexes. In addition, everything is very compact – literally at hand. 

– Did you manage to find a suitable option right away, or did you experience any difficulties in selecting?

– I am a realistic person, therefore, in principle, I already knew exactly what I want. The selection did not take much time, since I approached the issue based on the budget and location. Fortunately, I had the opportunity to buy an apartment at an affordable price in a good area. We opted for an apartment of 120 square meters with two bedrooms and two toilets, with a stunning view of the bay and the ocean from 21 floors. Imagine, sometimes you can see dolphins and sea cows from the open balcony! In addition, it is a gated complex consisting of two buildings of 27 floors each, two swimming pools, a fitness room, a sauna, a library, a children’s playground, security 24 hours a day. This apartment was unfurnished, purchased on the secondary market and required repair.

– As far as I know, your successful experience in purchasing housing for yourself has allowed you to go further and now your work is also related to real estate? 

– Indeed, today I work in a real estate agency that I myself founded – MNM Companies LLC (Miami, Naples (Florida), Moscow). After I personally managed to successfully invest in housing, I decided why not help others in this …

RENTAL BUSINESS IN FIGURES

– Do you still live in this apartment? 

– No, at the moment I rent it to one family from Latin America. 

– How much can a flat bring to Miami from rental? 

– It all depends on the amount of investment, the location of the object, the amount of rent and maintenance costs, and of the lease term. For example, housing cost you $ 100 thousand. Monthly costs – $ 500 x 12 months = $ 6 thousand. Annual property tax – $ 2 thousand. In turn, rental income will be $ 1.3 thousand. X 12 months = 15 , 6 thousand dollars. From them we deduct 8 thousand dollars of expenses and we get 7.6 thousand dollars. As a result, I paid for this apartment for 10 years. And let’s not forget to take into account the fact that the property has increased in price, and I could take a loan for it and buy another property to get the next income.

– How did the cost of your apartment change? 

– In 2001, it cost about 250 thousand dollars, and now it is about 350 thousand dollars, but this is due to the fall in prices during the crisis. That would be even more expensive. For example, in 2006, the bar rose to 450 thousand dollars.

WHAT TO DECLARE TO RUSSIANS IN FLORIDA?

– In general, are there any special requirements for the purchase of housing by foreigners in Miami?  

– One of the most common requirements for foreigners when buying property with a loan is a visa or any other document confirming your legal presence in the country. It also checks if you are involved in any terrorist groups (after September 11, 2001). 

– If this is such a popular destination, then the annual maintenance of the apartment is expensive? And is it more expensive for foreigners than for US citizens?

– It does not matter whether you are a US citizen or a foreigner, the amount of monthly servicing depends on the area of ​​your apartment, the services provided in the complex and the cost of maintaining the complex in proper form. Service can vary from 150 dollars to 3 thousand dollars a month. We all know that the more elite a house, the more expensive the price of service. Also, do not forget to take into account the fact of the mandatory payment, as a tax on real estate. In each county, it is different, but not much different, and ranges from about 1.5% to 2.6% of the estimated amount of the object, which is determined by the city appraiser annually, based on sales for that year. The tax is paid at the end of the year, but the city may give a deferment of payment.

HOW ARE THE TRANSACTIONS?

– How did the deal go? Have you applied to the bank for a loan?

– In 2001 it was not difficult to obtain funding even for non-citizens of America. Usually, banks gave a loan of 70-80% of the estimated value of the object. It took me about a month to complete the transaction, as it was necessary to check everything, to make sure that the seller is the one who is registered / registered / has property rights in this object. In addition, it was necessary to check if the previous owners had rent arrears. And are there any individuals or legal entities applying for this object for any reason. At the time of signing the contract, the buyer usually pays the first installment, then after about 5-10 days (depending on how stipulated in the purchase contract) a second installment is made in the amount of 10% – 20% of the purchase price agreed by both parties. The first installment is, in essence, an advance showing the seriousness of the buyer’s intentions.

– And what are your current mortgage conditions? 

– Now the rate has fallen to 3.13% from 6%. But at the same time tightened the conditions for issuing a loan. In particular, you must provide the bank with a statement of your income and expenses for the last two years.  

– Who else is involved in the deal in the US? 

– All transactions relating to real estate, pass only through lawyers, who in turn check from A to Z the entire history of the object. After that, they draw up documents on property and insurance, so that after the purchase of this object, no one can claim this property. 

– What were the costs of a lawyer when making a deal? 

– These costs are approximately 1.7% – 2.5% of the purchase amount. The main cost of insurance concerns the verification of the legal purity of the object.

EXPERIENCE – THE SON OF HARD MISTAKES

– What, in your opinion, is definitely worth paying attention when buying a home in the US? 

– I would definitely find out what expenses there are per month and per year: taxes, house maintenance, a communal flat, and so on. I would find out how often it is possible to rent the rules regarding repairs, since the house management (the residents’ association), for example, obliges to put sound insulation of a certain thickness when laying the floor. And here it is necessary to remember that the repair and construction work must be approved by the association of tenants and the inspector from the city. It is also necessary to

understand whether parking is attached to this apartment, because not in every complex it becomes a property along with the apartment. 

– Did you have any errors that could have been avoided?

– Yes, they certainly were. When I first bought, I didn’t speak English well and I wasn’t aware that I had to pay monthly maintenance. It seemed to me that I paid for the purchase for several months in advance, respectively, I received a letter from a lawyer who represented the housing complex association, and unfortunately: I had to pay for a letter from a lawyer in the amount of about $ 500 and also a penny along with the unpaid service. 

– And how much is the average square meter of housing in Miami now? 

– It all depends on the location. If near the ocean, then an average of $ 600 per square meter – this is at least for elite real estate. But if the property is not in a luxury building, then from $ 270 per square meter and above.

– Was it easy to get comfortable in a new place, especially with neighbors? Still, another continent. 

– I like that the neighbors are friendly and do not bother. And certainly at 12 at night, unexpected guests will not knock at you. And even if the neighbors are noisy, this is quickly remedied by a warning and sometimes even a fine from the association of the complex. Of course, there was a language barrier at the beginning, but it passes quickly when you live and you need to somehow explain somewhere that, in principle, gives a good practice when learning a language. 

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