Foreign Nationals in the U.S. Real Estate Market - Know Your Ground
By R. Scott Jones, Esq.
The luster of the real estate market in the United States shines even more brightly for investors in current market conditions. While the appeal for foreign investors may have leveled off somewhat with the strengthening of the U.S. dollar in the last year against a number of currencies, some brave investors believe that certain markets still look historically attractive.
Indeed, foreign nationals present in the U.S. temporarily may also be attracted by the capital gain exclusion available on real estate eligible to be treated as one's principal residence, that permit owner-occupiers to exclude up to US$500,000 on a married filing joint basis. Even on a revenue basis, the deductibility of mortgage interest and real estate taxes (subject to Alternative Minimum Tax restrictions) is a further compelling reason for some.