Need cash? Your global home equity can help!

Post author By Premela R.
Post date June 28, 2024

Has your international property appreciated in value? If so, your equity—the portion of the property you own—has likely increased as well!

A popular way to tap into this growing equity without selling your home is through a conventional Cash-out refinancing or Asset-backed bridging loan.

Quick Comparison

Bridging loan

Approval 48 hours
Funding in as fast as 7 days
Up to 70% of your home's value
Available for primary homes, second homes, and investment properties
Short-term (1-2 years) and not meant to replace a bank loan
No age restriction in many countries
Qualify on property value only (no need to show income)

Cash-out refinance

Exactly the same as a conventional residential mortgage
Qualify using your salary or rental income of the property
30-45 days funding times (each country may vary)
Often used to purchase more property

How Bridging Loans Work

Bridging loans are short-term loans, usually 1-2 years, used to bridge a funding gap where banks cannot meet borrower requirements such as speed of funding, loan-to-value (LTV), and certainty. These loans are asset-backed, relying on the collateral value of the property rather than the borrower's personal financials. They typically feature "interest-only" or "interest-servicing only" payments with a bullet repayment at the end of the term.

$186M bridging loans funded in Singapore YTD!

In a recent press release in Singapore, Global Mortgage Group set a new benchmark in a record-breaking month by facilitating bridge loans for two high-end condominiums, three bungalows, and one Good Class Bungalow (GCB). In 2024, GMG has funded over $186 million in bridging loans in Singapore alone.

Recent Funded International “Bridging Loans”

USA

An Indonesian family office owned 3 homes in California free and clear, worth $17M. Since the homes were empty and used as second homes, bank financing was not an option, and the client needed funding within a month to be repatriated back home for working capital. We secured an interest-only $10M loan for 2 years, funded in 2 weeks!

England

A private bank referred a client who needed to purchase a Golden Visa in Europe. However, since their country had capital controls, they were not able to move the required amount of funds in the necessary time frame. We secured a bridging loan against their U.K. prime real estate to be used for the Golden Visa investment. Terms were 1 year, 70% LTV, funded in 3 weeks!

Singapore

Our client, a Singaporean entrepreneur, owns a $15 million bungalow. To expand his retail business, he secured a $11.25 million bridge loan (75% LTV) over 12 months. This provided liquidity to complete his shophouse purchase without selling his bungalow, funded in 3 weeks!

Amount of Home Equity in the U.S., England and Australia

With global home values rising and equity growing, many homeowners now have significant equity to extract cash for personal use.

USA

$17 trillion in U.S. home equity!
38% of homes are debt-free (CoreLogic, 1Q2024)

England

8.8m homes are owned outright.
Total home equity is estimated at £2.5 trillion (Octane Capital, 2022)

Australia

Home value $9.3 trillion vs corresponding debt level of around $2 trillion
78% home equity of $7.3 trillion (Robert Baharian, 2022)

Global Bridging Loans

For investors looking to release equity from their property globally, Global Mortgage Group offers bridge financing in the U.S., Canada, U.K., Europe, Australia, Dubai, Singapore, Hong Kong, Philippines, and Thailand.

Global Bridging Loans

USA - from our subsidiary, America Mortgages

A practical way to tap into this growing equity without selling your home is through a conventional cash-out refinancemortgage or an asset-based bridge loan.

Foreign nationals and U.S. expats often face unique challenges when leveraging home equity in the U.S. America Mortgages's loan programs are designed to meet these needs, making the process smoother and more accessible.

1. Conventional Cash-out Refinance Mortgages

Cash-out refinance mortgages are a good option if you have consistently made regular mortgage payments in a timely manner since owning the property or if you have no existing mortgage on the property. However, we recognize securing a mortgage can be challenging for foreign nationals and often U.S. expats because they lack a U.S. credit history. At America Mortgages, we can use international credit reports and other financial documents in lieu of U.S. credit. It’s so straightforward that Foreign nationals are eligible to borrow up to 75% of their property's appraised value, while U.S. expats can borrow up to 80%.

Key Loan Features and Requirements

Income: Foreign income accepted
Credit: Overseas income and credit accepted (if required)
Term Lengths: 30-year and 40-year fixed-rate mortgages regardless of the borrower's age
Term Options: Fixed 10-year, Interest-Servicing Only (Interest-Only) mortgages available
Loan Amounts: From US$100,000
Cash-out Refinance Loan-to-Value: Up to 80% for a U.S. expat and 70% for a Foreign National
Property Types: Single-family, multi-family (5+ units), duplexes, triplexes, quadplexes, condominiums, townhomes, commercial, industrial
Location: All 50 U.S. States
Amortization: All loans can be amortized over 30 years, regardless of age
Closing Time: 30-45 days

2. Asset-backed real estate bridge loans

Asset-backed bridge loans are designed for U.S. expats and foreign nationals who need flexibility and quick access to funds. These loans are perfect for short-term financial needs or investment opportunities and normally do not require the borrower to provide financials.

Key Loan Features and Requirements

Income: No income required
Credit: No U.S. credit is required
Eligible Loan Types: Purchase, refinance, and cash-out refinance
Term Lengths: 12-24 months
Loan Amounts: US$200,000 to US$100m
Payment Options: Monthly, interest-only, interest rolled up
Loan-to-Value: Up to 75%
Property Types: Single-family, multi-family (5+ units), duplexes, triplexes, quadplexes, condominiums, townhomes, commercial, industrial
Location: All 50 U.S. States
Amortization: Interest-Only Servicing
Closing Time: 3-10 days

America Mortgages and Global Mortgage Group aims to simplify the process for foreign nationals and U.S. expats, providing the financial flexibility they need. Our tailored loan programs are designed to suit your unique situations, helping you make the most of your property's equity.

With our fast approval process, flexible terms, and international reach, we’re here to support your financial needs. Schedule a meeting with us today, and let’s turn your home equity into cash for whatever you need. Get started now!

www.gmg.asia

Global Mortgage Group’s Record-Breaking Month with Bridge Loans for Condos Bungalows and a GCB

Post author By GMG
Post date June 27, 2024

Your child gets accepted to a U.S. university, and you want to buy a home nearby…

Post author By Premela R.
Post date June 18, 2024

Your child gets accepted to a U.S. university and you want to buy a home nearby..

Here is a video of our initial idea when we raised our first round of funding

There are 3 types of real estate purchases:

Trophy assets
Education-related
Investment

There is obviously an overlap but for this article, we focus on #2 - education-related.

This was my journey when I left Asia to study in the U.S. as well as most, if not all, of my friends. In fact, through our research, we have concluded that education is the most popular reason to invest in overseas property.

Top 10 Asian countries with students attending U.S. universities as of 2023:

China – 289,526

India – 268,923

South Korea – 43,897

Vietnam – 21,900

Taiwan – 21,834

Japan – 16,054

Bangladesh – 13,563

Indonesia – 8,467

Hong Kong – 5,867

Singapore – 3,182

I'm fairly sure that most of these parents would also like to own an investment property - now they can!

Your child gets accepted to a U.S. university, and you want to buy a home nearby….

After 4 years of university, you can:

Sell the home, and the capital gains can be used to recoup the college tuition
Have your child stay in the apartment while they work in the U.S. to get "international" experience before they come back home
Transfer to your child's name to build credit and or earn rental income while they are living in the U.S.
Keep it to earn rental income

What happens next?

You speak to your local bank, and they do not offer U.S. mortgages - no overseas banks offer U.S. mortgages (but you don't know that).

You search online and do not see any U.S. banks - U.S. lenders do not advertise outside the U.S. (you didn't know that either).

You give up and pay for the home with cash!

Foreign home buyers face this problem every day!

Did you know that over the past 10 years, non-U.S. citizens have purchased $1 trillion worth of U.S. real estate, and almost 70% of it is paid with cash because of the problems mentioned above?

Our subsidiary, America Mortgages, is the world's only U.S. mortgage broker outside the U.S., focusing on overseas borrowers, both foreign nationals and U.S. expats - that is all we do.

Some common misconceptions:

My child/student can not be the tenant - wrong!

Our "AM Student +" loan program is the world's only mortgage that allows this - just need a F-1 student visa.

My child/student can not qualify since they have no income - wrong!

We use a rental comparable to qualify - if it the comparables exceed the mortgage expenses - you qualify!

I need U.S. credit - wrong!

We accept overseas credit or a letter from your accountant

I need to be a salaried employee - wrong!

You can qualify with the rental income of the property - no need to show income!

I need to be living in the U.S. - wrong!

All of our clients are living outside the U.S.

I can't get a mortgage - obviously wrong!

We founded America Mortgages to fix the problem of obtaining a U.S. mortgage while living overseas

I'm too old to qualify for a loan - wrong!

There are no age restrictions in the U.S.

Banks don't give loans to foreigners - wrong!

We created loan programs specifically for foreign borrowers

I can't borrow much as a foreigner - wrong!

Our programs can lend up to 75% of the property value

The process is very difficult and takes too long - wrong!

We have streamlined the process with technology and our average loan takes 30-45 days to close - faster than any bank!

I need to stay up late at night to speak to a loan officer - wrong!

We have loan officers in your timezone, speaking your language, 24/7

Investing in a home near your child's university in the U.S. offers financial benefits, from potential capital gains to rental income. At America Mortgages, we make it easy for international buyers to secure U.S. home loans, debunking myths and simplifying the process. Ready to invest? Contact us today at [email protected].

www.gmg.asia

LLC and Tax Strategies for U.S. Real Estate Investors

Post author By Premela R.
Post date May 28, 2024

What is an LLC or Limited Liability Company

Investing in U.S. real estate can be an amazing opportunity for non-U.S. residents, offering opportunities for substantial yields, capital appreciation, stability and portfolio diversification. However, navigating the complexities of the U.S. tax system and legal environment requires expert advice, and America Mortgages, besides being your mortgage partner, is there with you at every step of the process. One of the most common and effective strategies for foreign national investorsis to use a U.S. Limited Liability Company (LLC) combined with smart and logical tax planning. Here’s why;

1. Liability Protection

An LLC offers liability protection, meaning that investors are typically not personally responsible for the debts and liabilities of the company. This is crucial for foreign investors who may not be familiar with U.S. litigation risks. Should any legal issues arise, the LLC structure can help shield personal assets from lawsuits or creditors.

2. Flexible Tax Treatment

LLCs provide flexible tax options. By default, a single-member LLC is treated as a disregarded entity for tax purposes, meaning income is reported on the investor's personal tax return. Multi-member LLCs are treated as partnerships. However, an LLC can also elect to be taxed as a corporation. This flexibility allows foreign investors to choose the tax treatment that best suits their financial situation and goals.

3. Simplified Estate Planning

Every investor should be aware of U.S. estate tax laws, especially in the event of the property owner's death. By holding property through an LLC, foreign investors can structure ownership in a way that may mitigate these estate tax implications. For example, ownership interests in the LLC can be transferred more easily than direct ownership of property, simplifying estate planning and succession.

5. Operational Efficiency

Owning U.S. real estate through an LLC can simplify the daily operations, especially if the LLC holds multiple properties. This centralization can streamline property management, accounting, and tax filing processes, making owning and managing real estate from abroad as easy as owning it in their home country (maybe even easier).

6. Proper Tax Planning

While an LLC offers numerous benefits, proper tax planning is essential to maximize those benefits and ensure compliance with U.S. tax laws. America Mortgages works with professionals who understand the complexities of foreign-owned or U.S. expat-owned real estate. Here are key considerations for foreign investors:

7. Understanding U.S. Tax Obligations

The U.S. tax filings are not as complicated as many people believe. It is important that foreign national investors understand their U.S. tax obligations, including federal, state, and local taxes. Engaging a tax professional experienced in international taxation can help navigate these obligations and identify opportunities for tax savings.

8. Utilizing Tax Treaties

The U.S. has tax treaties with many countries that can provide benefits such as reduced withholding rates on dividends, interest, and other income. Investors should review applicable treaties and incorporate them into their tax planning strategy.

9. Structuring Investments

Proper structuring can minimize tax liabilities. For example, layering LLCs or using a combination of LLCs and other entities, like corporations or trusts, can provide tax advantages and additional asset protection.

10. Consulting with Experts

Given the complexity of U.S. tax laws, consulting with legal and tax professionals who specialize in real estate and international taxation is essential. They can provide tailored advice, ensuring compliance and optimizing the investment’s tax efficiency.

In conclusion

For foreign nationals, investing in U.S. real estate through an LLC offers significant advantages, including liability protection, flexible tax options, and simplified estate planning. However, these benefits can only be fully realized through careful tax planning and compliance with U.S. tax laws. By leveraging the expertise of professionals and utilizing strategic planning, foreign investors can navigate the complexities of the U.S. real estate market effectively and achieve their investment goals.

Want to learn more?

We are excited to invite you to our month-long webinar series, offering a wealth of information on U.S. real estate investment.

First, join us for an informative session on "Why and How to use an LLC for U.S. Real Estate Investing" Discover the benefits of forming an LLC for overseas property investment, including legal protection, asset security, tax advantages and cost of set-up.

Webinar: Why and How to Use an LLC for U.S. Real Estate Investing

Date and Time: June 7, 2024, 07:30 AM SGT
Registration Link: Register here

Next, don’t miss our session on "3 Tax-Smart Strategies for U.S. Real Estate Investing" Learn how strategic tax planning can enhance rental income for overseas investors, offering insights into U.S. tax strategies that reduce liabilities and boost cash flow.

Webinar: 3 Tax-Smart Strategies for U.S. Real Estate Investing

Date and Time: June 13, 2024, 6:30 PM SGT
Registration Link: Register here

Get ready to elevate your investment game! We can't wait to see you there.

U.K.’s Rental Potential: Your Next Big Investment Awaits!

Post author By Premela R.
Post date May 17, 2024

The rental market in the U.K. is thriving! Rental prices are soaring, and this presents a golden investment opportunity. At Global Mortgage Group, we're here to help you navigate the U.K. property market with expert advice and strategies tailored to your needs.

High Demand and Rising Rents

As the number of individuals relocating to the U.K. increases, so does the demand for rental properties. Consequently, this leads to higher prices in a competitive market. According to a recent Bloomberg analysis, this trend is expected to continue, providing real estate investors with a stable source of rental income and the potential for property value appreciation.

Investment Potential

Investing in the U.K. rental market offers several benefits:

Stable Returns: Consistent rental income due to high demand.
Capital Growth: Properties in high-demand areas are more likely to appreciate over time.
Portfolio Strengthening: Adding real estate assets for a well-rounded investment strategy.

To Maximise Returns in the U.K. Rental Market

Research and Location: Invest in areas with strong rental demand and growth potential, such as cities with large student populations or strong job markets.
Property Management: Employ professional property management services to maintain profitability.
Do The Math: Calculate costs, expenses, and potential income.

GMG Foreign National England+ Loan Program

Navigating U.K. financing as a foreign national can be challenging, but Global Mortgage Group makes it straightforward. Our Foreign National England+ loan program is tailored for non-resident investors seeking to tap into the U.K. rental market. With no U.K. credit or residency requirements, our program offers up to 70% loan-to-value, providing accessibility and flexibility for property investors. Get pre-approved within 48 hours and a formal approval in just 7 days. Investors can complete the closing process conveniently outside England.

Explore the potential of the U.K. rental market with Global Mortgage Group. Contact us today at [email protected] to learn more about our Foreign National England+ loan program and start your investment journey.

By leveraging GMG's expertise and resources, foreign national investors can confidently invest in the U.K. rental market, securing properties with high return potential.

For specific information on rates and terms, please reach out to our team at [email protected].

International Real Estate Financing

We also offer residential mortgages in the U.S., Canada, LATAM, France, Spain, Portugal, Dubai, Japan, Thailand, and the Philippines.

International Equity Cash-out "Bridging Loans"

Need Cash Fast? We offer short-term loans based on the equity value of your home in: the U.S., Canada, U.K., Singapore, Hong Kong, Philippines, Thailand and Australia. These have been popular ways to access cash when speed of financing, high loan-to-values and certainty are the priority.

www.gmg.asia

Australia’s Rental Boom: Your Investment Opportunity Awaits!

Post author By Premela R.
Post date May 10, 2024

Australia's rental market is heating up, catching investors' attention nationwide. With rental prices skyrocketing, many view it as a prime investment opportunity. Seizing this opportunity requires savvy strategies, and Global Mortgage Group is here to assist you.

Australia's Rental Market

A recent report from The Business Times shows that Australia's rental market is not just heating up; it's in full swing. Rent prices are soaring due to surging demand, limited housing supply, and rising property values. Tenants in bustling cities and quiet regions feel the pressure as rents hit new highs. According to the property data provider CoreLogic, the median rent in Australia is now $627 a week.

Investment Opportunity

For investors, this rental surge offers promising prospects. With high rental demand, there's potential for a steady income and attractive returns. Plus, property values may rise over time, boosting profits.

To Thrive in the Rental Market:

Location, Location, Location: Choose areas with strong rental demand and growth potential.
Choose wisely: Invest in properties that meet renters' needs.
Crunch the numbers: Calculate costs, expenses, and potential income.

GMG Australia + Loan Program

With our expertise in international financing and Australian property, we help foreign investors confidently secure loans. Our GMG Australia + loan program is designed specifically for non-resident investors interested in the Australian rental market. It does not require Australian credit or residency, and you can get up to 85% LTV with GMG Australia +.

Australia's rental market boom holds tremendous potential for investors hungry for high returns. Non-resident investors can navigate the market terrain effectively by using savvy strategies and partnering with Global Mortgage Group. Contact us today at [email protected].

For more information, please contact Leonard Lee, Head of Australia, at [email protected] or +65 8282-5388.

International Real Estate Financing

We also offer residential mortgages in: the U.S., Canada, LATAM, U.K., France, Spain, Portugal, Dubai, Japan, Thailand, and Philippines.

International Equity Cash-out “Bridging Loans”

www.gmg.asia

The Top 5! Which 5 foreign buyers are buying which 5 U.S. states?

Post author By Premela R.
Post date May 3, 2024

Top 5 Foreign Buyers of U.S. Residential Real Estate*

China 13% of total = $13.6B
Mexico 11% of total = $4.2B
Canada 10% of total = $6.6B
India 7% of total = $3.4B
Colombia 3% of total = $900M

Top 5 States for Foreign Buyers*

Florida 23%
California 12%
Texas 12%
North Carolina 4%
Arizona 4%

US$53.3 billion*
The total value of foreign buyers of U.S. real estate

$639,900*
The average purchase price by a foreign buyer

*National Association of Realtors, year ending March 2023

Contents:

Average purchase price of top 5 foreign buyers
Top 5 states buyers from China, Mexico, Canada, India and Colombia are choosing, respectively
Top 5 origin of foreign buyers in Florida, California, Texas, North Carolina and Arizona, respectively
What surprised us from our research!

TOP 5 FOREIGN BUYER ANALYSIS

Asian buyers continue to lead the charge as the largest group of buyers, with a 38% market share. Going forward, we expect to see increased demand from SE Asia as growth in this region continues to exceed expectations.

LATAM was the runner-up with a 31% share of total foreign buyers, not far behind China. We are very excited about the growth outlook for LATAM as the reshoring of manufacturing to The Americas, and the growth outlook improves. One interesting point is that Colombia replaced the United Kingdom as the 5th largest international buyer, proving the growth of LATAM at the moment. We have recently set up an office in Panama and are looking to rapidly expand our footprint here.

European buyers accounted for 14% of foreign buyers, while Canadian buyers alone accounted for 10%.

Chinese buyers continue to have the highest average purchase price at $1.2 million, as buyers purchased in expensive states: 33% of Chinese buyers purchased a property in California, and 6% purchased in New York. This makes sense since California and New York have better-known schools, and a big driver in this decision is education. See our Deep Dive on The Best U.S. High Schools.

Watch Now: Irvine, California - Why is it the most popular destination for Asian homebuyers over the past 10 years?

Mexican buyers typically purchased the least expensive properties, with Texas as the preferred destination. This can be explained by the geographic proximity.

Average purchase prices for Foreign Buyers

China $1.2M
Mexico $449K
Canada $779K
India $577
Colombia $355K

Buyers from China - Top 5 Destinations

California 33%
Florida 16%
Texas 8%
Colorado 6%
New York 6%

Buyers from Mexico - Top 5 Destinations

Texas 48%
California 18%
Ohio 6%
Arizona 4%
Florida 4%

Buyers from Canada - Top 5 Destinations

Florida 55%
Arizona 14%
California 4%
Louisiana 4%
Montana 4%

Buyers from India - Top 5 Destinations

California 20%
Pennsylvania 14%
Texas 11%
Alaska 9%
Illinois 9%

Buyers from Colombia - Top 3 Destinations

Florida 80%
California 13%
Illinois 7%

TOP 5 DESTINATION ANALYSIS FOR FOREIGN BUYERS

Florida is the top destination for foreign buyers with 23% market share, mostly coming from LATAM 46%, Canada 24%, Europe 16% and Asia 14%. Florida has the best combination of vacation home, investment property and also luxury homes.

California has the 2nd largest market share of foreign buyers at 12%, mostly coming from Asia. Direct flights, temperate weather, and well-known universities make it an obvious destination for Asian buyers. See our California Report.

Texas was the 3rd top foreign buyer destination, with a 12% market share. Texas is one of our top 3 choices for pure real estate investments. The zero-state tax rate will always generate an incoming population from gentrification and also companies setting up their headquarters. For example, Dallas is the headquarters for the Fortune 500 companies in the world!

North Carolina was the biggest surprise to me as the 4th-highest destination for foreign buyers. One of the prettiest and underappreciated states, North Carolina, deserves more research on what is driving the interest of foreign buyers. We will keep you posted.

Arizona has always been a popular destination for foreign buyers and is the 5th-most popular destination, with 4% of all foreign buyers.

Share of Top 5 State to Total Foreign Home Buyer Purchases

Florida 23%
California 12%
Texas 12%
North Carolina 4%
Arizona 4%

Florida - Origin of Foreign Buyers

LATAM/Caribbean 46%
Canada 24%
Europe 16%
Asia/Oceania 14%

California - Origin of Foreign Buyers

Asia/Oceania 61%
LATAM/Caribbean 22%
Europe 7%
Africa 7%
Canada 3%

Texas - Origin of Foreign Buyers

LATAM/Caribbean 55%
Asia/Oceania 25%
Europe 11%
Africa 5%
Canada 4%

North Carolina - Origin of Foreign Buyers

Asia/Oceania 50%
Europe 22%
LATAM/Caribbean 22%
Canada 6%

Arizona - Origin of Foreign Buyers

Canada 37%
Africa 26%
Asia/Oceania 16%
Europe 11%
LATAM/Caribbean 11%

What surprised us from our research?

The average price for a Chinese buyer is $1.2M
North Carolina, the 4th most popular state for foreign buyers
Asians are the largest foreign buyers of North Carolina real estate
Indian buyers prefer Pennsylvania as their 2nd most favorite state
Canadians are the largest foreign buyers in Arizona
Africa, the 2nd largest foreign buyer of Arizona real estate

Our analysis reveals fascinating trends in the U.S. residential real estate market driven by foreign buyers. While China remains a major player, Asian buyers take the lead overall. Florida stands out as the top destination, but California, Texas, and even a surprising North Carolina, all attract significant foreign investment. The data highlights the diverse motivations behind these purchases, with factors like education, investment potential, and proximity influencing location choices.

Ready to explore your U.S. real estate opportunities? Contact us today at [email protected] or schedule a call with our loan officers and schedule a commitment-free meeting with one of our U.S. loan officers to explore your U.S. mortgage options further, you can do so using our 24/7 calendar link. Our team can help you navigate the intricacies of financing your U.S. investment property.

Turn your home equity into cash (globally)!

Post author By Premela R.
Post date April 26, 2024

Need cash fast? Tap into your home equity today!

U.S. homeowners are the most “equity-rich” they have ever been, thanks to their home equity increasing over 32.2% since 1Q2021. That’s a year-over-year gain of over $3.8 trillion for the entire housing market.

This significant increase in home equity has provided many homeowners with the opportunities to cash in through home equity loans and cash-out refinancing!

Article Contents:

Why is home equity important?
How to access your home equity?
Common use of funds
Global bridging loans

Why is Home Equity Important?

Home equity is an excellent long-term wealth-building strategy. To demonstrate just how true this is, let’s compare an auto loan to a mortgage. When you take out an auto loan, you are paying interest on an asset that depreciates in value as soon as you drive it off the lot. That means that when you’ve paid off the loan, the car will most likely be worth less than your purchase price, and you will have paid interest.

In contrast, mortgage payments reduce your debt while your home increases in value. Of course, property values could drop, but that is unlikely to happen over the long term. One very financially powerful aspect of this is that you don’t need to sell your home to profit from it.

How to Access Home Equity

Equity-rich homeowners have two options for accessing their equity without selling their homes:

1. Home Equity Loan: Think of this as taking out a second mortgage for a fixed rate that must be repaid within a set period.

2. Cash-Out Refinance: This option is excellent when you’ve seen an increase in the value of your property. If you’ve just recently purchased a property, you’ll need to wait for at least 6-12 months to use the new value.

The best way to cash in on your equity depends on your goals. For example, releasing equity is a well-known way to acquire more real estate and build a portfolio.

Common Use of Funds (to name a few)

Refinancing
Renovations
College tuition
Pay off high-interest debt
Personal business needs
Purchasing more property (BRRRR method)
Cash while waiting for sale
Down-payments
Other investments

Global Bridging Loans

Bridging loans are short-term loans, normally 1-2 years, which are used to “bridge” a funding gap where banks are unable to meet the borrowers requirements, usually - speed of funding, loan to value and certainty.

Bridging loans are based on the collateral value of the property (asset-backed) and not the borrower's personal financials. Loans are normally “interest-only or interest-servicing only” with a bullet repayment at the end of the terms. These loans have been very popular over the past few years as retail banks have significantly reduced their willingness to lend on property (globally), and private loans (private credit) have filled the gap.

Countries We Offer Bridge Financing in:

USA
Canada
UK
Australia
Singapore
Hong Kong
Philippines
Thailand

Basic Details

Get approved in 24 hours and funding in as fast as 7 days
Up to 70% of your home’s value
Available for primary homes, second homes, and investment properties
Priority is speed of funding, certainty, and high loan-to-value
Short-term and not meant to replace a bank loan
No age restriction in many countries

With our fast approval process, flexible terms, and international reach, we’re here to support your financial needs. Reach out to our International Loan Officers today, and let’s turn your home equity into cash for whatever you need. Get started now!

www.gmg.asia

Average U.S. rental yields are 8% and rising!

Post author By Donald Klip
Post date April 19, 2024

8% and Rising!

That's right! Not a typo. The average rental yield in the U.S. is 8%.

It is unheard of in any major country, and it is quite a shock to nearly everyone who hears this, but it's true.

More importantly, we have a loan program specifically-created for international investors looking for an easy way to qualify for a mortgage by using the rental income and not personal financials (see below).

This article is a summary of a presentation we made to our clients.

On a LinkedIn survey last week, we also asked the following:

What is the average rental yield in America?

Range	Responses
4% - 5%	57%
5% - 6%	20%
6% - 7%	9%
7% - 8%	14%

You can see the mean expectation is 4-5%, but in fact, if I could put 3-4%, most would probably choose that, but we couldn't put that many choices and still accommodate for 7-8%.

This illustrates the fact that most investors don’t realize the cash flow opportunities from investing in U.S. real estate. We want to change that perception.

Global Rental Yield Comparisons

UAE 12.3% (Ranked #1)
USA 8.1% (Ranked #12)

G7
UK 4.3%
Canada 3.9%
France 2.6%
Italy 4.2%
Germany 3.4%
Japan 2.4%

As you can see, most developed countries have a rental yield lower than 4%, and half of the major Asian countries have a rental yield under 3%. Greater China countries are below 2%!

When investing in these markets, investors “hope” prices will rise for capital appreciation but there is little to no cash flow opportunities.

Why is the U.S. so high?

Severe Housing Shortage

From 2012 to 2022, 6.5 million 'more' households were formed compared to homes built. "Household Formation" refers to the change in the number of households (persons living under one roof or occupying a separate housing unit) from one year to the next. Let that sink in for a bit….

There is currently a 5.5M home shortage to meet existing demand.

Higher labor and raw material costs with stringent zoning laws make it difficult to build homes fast enough to meet demand.

Existing Home Sales

Existing home sales normally account for 90% of total home sales.

Of the existing homeowners with a mortgage,

99% are UNDER 6%
80% are UNDER 5%, and
40% are UNDER 3%

What this means is the supply is not moving unless sellers are willing to pay capital gains or move to a higher priced home using a 1031 Exchange - regardless, they will have to face a higher mortgage rate.

It's no surprise that in 2023, existing home sales fell to the lowest level in nearly 30 years, while the median price hit a record high, according to a recent report by the National Association of Realtors.

Scylla and Charybdis

Similar to boats crossing the Straits of Messina in Homer's Odyssey, homebuilders face a similar dilemma of whether to construct houses that buyers may not be able to afford with 7%+ mortgage rates or to hold back and therefore make long-term housing supply issues worse.

Institutional Buying

The current lack of supply plays right into the hands of Blackstone and its peers.

The Blackstone Playbook is well-known :

Identify supply-demand imbalances
Invest billions to build giant landlords
Dictate rental pricing

January 2024, Blackstone announced the acquisition of Tricon Residential for $3.5B, making it the 3rd largest landlord (62K homes) in the U.S. behind Progress Residential (84K homes) and Invitation Homes (82K homes).

Meanwhile, just last week, Blackstone purchased private rental housing apartment firm Air Communities for $10B in cash!

Demand

COVID accelerated WFM which was growing 2.5% per year before the pandemic. It suddenly went to 100% and reversing this trend is difficult and technology has become so good that execution-based roles can be done remotely.

Meanwhile, when companies get to a certain size in expensive states such as California and New York, it becomes too expensive to live and operate a company, and many move their headquarters to a state with a lower cost of living and state taxes, like Texas. For example, Dallas has the most Fortune 500 companies in the world as their headquarters, and this is increasing every year.

U.S. Rental Yields

Here is where it gets interesting….look at some of these rental yields!

Detroit	32.9%	Tulsa	13.5%	Las Vegas	10.8%
Milwaukee	20.7%	Colorado Springs	13.2%	Anchorage	10.4%
Omaha	18.3%	Nashville	12.7%	Atlanta	10.3%
Baltimore	17.2%	Spokane	12.3%	Miami	10.1%
Indianapolis	17%	Madison	11.5%	Denver	9.5%
Memphis	15.9%	Tucson	11.4%
New Orleans	13.6%	Ann Arbor	11.1%

This is an illustration of what is happening due to the reasons stated above:

Unfixable housing shortage
Gentrification to lower cost-of-living states
Supply is further being squeezed by institutional buying
Marginal homebuyer has to rent, given high mortgage rates

It's never been a better time to be a landlord!

I always tell clients, if you can make the numbers work now, they will only get better because rental yields WILL RISE, and when mortgage rates decline, you can refinance to a lower rate. Over time, your net cash flow will only rise.

More importantly, when the value of the home rises, you can refinance 70% of the increased home value to lower the investment cost!

Mortgages for International Investors

AM Rental Coverage+

Our loan program was designed specifically for international investors looking for an easy way to qualify for a mortgage by using the rental income and not personal financials.

Up to 75% loan-to-value
30-45 days closing
If rental income > mortgage and other costs = you qualify!!
No age restrictions
Closing documents signed at your local U.S. embassy

If you’re interested in learning more, reach out to us at [email protected] or visit our website at www.gmg.asia. Additionally, if you’d like to schedule a commitment-free meeting with one of our U.S. loan officers to explore your U.S. mortgage options further, you can do so using our 24/7 calendar link.