In recent years, an increasing number of people have been purchasing property in the United States. However, buying a home in the U.S. is not as straightforward as it is in China. One must proceed with caution and careful consideration. Before purchasing U.S. real estate, you should understand the maintenance costs, how to maintain a U.S. property, and what the associated expenses are. In the United States, the tax costs of holding property are very high. If you do not calculate the return on investment beforehand, it is very likely that the rental income will not cover the holding costs. In addition to the price of the property itself, there are insurance premiums, closing costs, appraisal fees, etc., which generally account for about 1% of the property price. More importantly, unlike in China, there are many ongoing expenses when buying a home in the U.S., the largest of which is property tax. Tax rates vary by location, with a national average of 1.38%, levied annually based on the government's assessed value. For example, a $500,000 property in Washington would incur an annual property tax of $6,500.
Furthermore, there are homeowners association (HOA) fees. HOA fees for condominiums generally range from $200 to $1,000 per month, while townhouses typically range from $50 to $100 per month. Single-family homes in managed communities may also have HOA fees. Additionally, the maintenance cost of U.S. houses is high; for instance, repairing a leaking water tank can easily cost over $100. If you sell the property, both the buyer and the seller typically pay a 3% commission to their respective real estate agents. Including various processing fees, you may pay approximately 7% of the transaction price. For investment properties sold within one year, a 25% capital gains tax applies, while properties held for more than one year are subject to a 15% capital gains tax. Starting this year, for individuals with an annual income over $200,000 or couples with an annual income over $250,000, an additional 3.8% tax is levied on all investment income.
U.S. properties require maintenance, such as roof repairs, deck upkeep, utilities, landscaping, and lawn care. There are also many community fees and property management fees for overseas properties, which are generally used to pay for the construction and maintenance of public facilities in the community. Depending on the services provided, these fees range from $150 per year to $300 per month. Property management fees mainly apply to condominiums, where they may only be $100 to $200 per year; however, some new villas and older condominiums may incur higher management fees, ranging from $3,000 to $5,000 per year.