How International Buyers Purchase Luxury Real Estate in the United States

The United States remains one of the most accessible and well-protected real estate markets in the world for international buyers. There are no restrictions on foreign ownership, no punitive buyer taxes, and no caps on investment. The legal framework is transparent, property rights are strong, and transaction data is publicly available.

This guide covers the full scope of what international buyers need to understand before purchasing luxury real estate in the United States — from the strategic reasons global investors choose the U.S. market to the practical details of ownership structures, financing, taxation, and closing. It draws on more than two decades of experience advising international clients at Manhattan Miami Real Estate, with a focus on the two markets where we operate: New York City and Miami.

Why International Buyers Invest in U.S. Real Estate

Global capital flows to the United States for a combination of reasons that few other countries can match simultaneously:

• Legal protection and transparency. The U.S. legal system provides strong property rights for all owners, regardless of citizenship. All real estate transactions are publicly recorded, and closed sale prices are available within 60 days. This level of transparency is unmatched by most global real estate markets.
• No foreign buyer restrictions. Unlike Canada (which bans most foreign purchases), Australia (which restricts purchases to new construction and imposes surcharges), or Singapore (which levies a 60% additional stamp duty on foreign buyers), the United States imposes no additional costs or limitations on international purchasers.
• Currency and political stability. The U.S. dollar is the world's reserve currency, and U.S. real estate provides a hedge against local currency devaluation and political instability. For buyers from regions with volatile economies, a U.S. property is a store of value as much as it is a residence or investment.
• Depth and liquidity. The U.S. luxury real estate market — particularly in New York and Miami — is deep enough to absorb large transactions without distortion. Properties can be purchased and sold efficiently, and the secondary market is active.
• Lifestyle and education. Many international families purchase U.S. real estate in connection with educational opportunities for their children, business operations, or personal lifestyle preferences. New York and Miami offer world-class schools, cultural institutions, and connectivity.

For a detailed comparison of how the U.S. treats foreign buyers relative to other major economies, read our guide: Can Foreigners Buy Property in the USA?

The Most Popular Markets for International Buyers

While foreign nationals purchase real estate across the United States, two markets consistently dominate international luxury transactions: New York City and Miami.

New York City

Manhattan is the world's most recognized luxury real estate market. International buyers are drawn to its global prestige, cultural richness, and long-term value stability. The island's supply constraints — 23 square miles with limited new construction — create a natural scarcity that underpins pricing. Manhattan's luxury condominium market offers foreign buyers transparent ownership, strong resale liquidity, and access to some of the world's most coveted addresses, including Billionaires' Row.

For a detailed market guide, read our International Buyers Guide to New York City Real Estate.

Miami

Miami has emerged as a global real estate capital in its own right, attracting buyers from Latin America, Europe, and the Middle East. Florida's lack of state income tax, combined with a thriving pre-construction market and an expanding inventory of branded residences, makes Miami one of the most financially attractive luxury markets in the world.

For a detailed market guide, read our International Buyers Guide to Miami Real Estate.

NYC vs. Miami

Many international buyers evaluate both markets before committing — and some ultimately purchase in both. For a side-by-side comparison of taxes, investment profiles, rental flexibility, and lifestyle, read our dedicated guide: NYC vs Miami Real Estate for International Buyers.

Ownership Structures for Foreign Buyers

How you hold title to a U.S. property has significant implications for tax liability, estate planning, and liability protection. International buyers typically choose one of the following structures:

Direct Individual Ownership

The simplest approach. You purchase the property in your personal name. This is straightforward and common for buyers who plan to use the property as a personal residence. However, direct ownership exposes you to U.S. estate tax on assets above $60,000 — a far lower threshold than the $13+ million exemption available to U.S. citizens.

U.S. Limited Liability Company (LLC)

The most common structure for international investors. Purchasing through a single-member LLC provides liability protection and simplifies tax reporting. When properly structured, an LLC can also be used as part of a broader estate planning strategy to reduce or eliminate estate tax exposure.

Foreign Corporation

Some international buyers hold U.S. real estate through a foreign corporation. This structure can eliminate U.S. estate tax exposure entirely, but it introduces other considerations — including the Branch Profits Tax and more complex filing requirements. Professional guidance is essential.

Trust Structures

Foreign trusts and domestic trusts are used by some buyers for estate planning purposes. The tax treatment varies significantly depending on the type of trust, the grantor's residency, and the terms of the trust instrument.

Financing Options for International Purchasers

While a significant portion of international luxury purchases are made in cash, mortgage financing is available to qualified foreign nationals. Several U.S. lenders specialize in foreign national loans, and some international banks with U.S. operations offer cross-border lending programs.

Typical terms for foreign national mortgages include:

• Loan-to-value ratios of 50%–70% — meaning a minimum down payment of 30%–50%
• Documentation requirements that include translated and certified financial statements, bank references, and proof of income from foreign sources
• An ITIN or EIN — a U.S. Individual Taxpayer Identification Number or Employer Identification Number is required for all foreign borrowers
• Slightly higher interest rates than those available to domestic borrowers, reflecting the additional underwriting complexity

If you maintain an existing banking relationship with a global institution — such as HSBC, Citibank, or Santander — that relationship may provide access to preferential lending terms or cross-collateralization options.

Condominium vs. Co-operative Purchases

This distinction is primarily relevant to the New York City market, where co-operatives represent roughly 70% of the residential housing stock.

Condominiums are real property. You receive a deed, and your ownership is recorded publicly. Most condo buildings allow rentals and resales with minimal board interference. For international buyers, condos provide the most transparent and flexible ownership experience.

Co-operatives are not real property — you purchase shares in a corporation that owns the building. Co-op boards have broad authority to approve or reject buyers, and the approval process typically includes extensive financial disclosure and a personal interview. Many co-ops restrict or prohibit subletting and impose financing limitations.

In Miami, virtually all residential properties are condominiums, so this distinction does not apply.

New Development Purchases

New development condominiums are particularly popular with international buyers in both New York and Miami. In most new developments, the purchase is made directly from the developer — which eliminates the board approval process entirely.

Advantages of new development purchases include:

• No board approval — the developer sells directly to qualified purchasers, streamlining the process for foreign buyers
• Modern construction and amenities — new buildings feature contemporary design, smart-home technology, wellness amenities, and energy-efficient systems
• Structured deposit schedules — particularly in Miami's pre-construction market, buyers can secure a unit with a deposit of 20%–30%, paid in stages during construction
• Potential tax abatements — some new developments in New York receive temporary property tax reductions under programs like 421a

Browse current opportunities: New Development Condos in Manhattan | Miami Pre-Construction

Tax Considerations for Foreign Buyers

Taxation is one of the most important — and most complex — aspects of international real estate investment in the United States. The following is a high-level overview. All international buyers should engage qualified U.S. tax counsel before purchasing.

Federal Income Tax

Foreign nationals who earn rental income from U.S. real property are subject to federal income tax. If you elect to treat the income as "effectively connected" with a U.S. trade or business (which most investors do), you file a U.S. tax return and pay tax on net income after deductions — the same treatment available to U.S. taxpayers.

State and Local Taxes

State-level taxation varies significantly. New York imposes state income tax (up to 10.9%) and New York City income tax (up to 3.876%) on income earned within the state. Florida, by contrast, has no state income tax — one of the primary reasons Miami has become so attractive to international investors.

FIRPTA (Foreign Investment in Real Property Tax Act)

When a foreign seller disposes of U.S. real property, the buyer is required to withhold 15% of the gross sale price and remit it to the IRS. This withholding functions as a prepayment of the seller's capital gains tax liability. Any overpayment is refundable when the seller files a U.S. tax return.

U.S. Estate Tax

Foreign nationals who hold U.S. real property directly at the time of death may be subject to U.S. estate tax on assets exceeding $60,000. The estate tax rate can reach 40%. This low exemption threshold — compared to $13+ million for U.S. citizens — makes entity structuring essential for most international buyers. Purchasing through a properly structured foreign corporation or trust can mitigate or eliminate this exposure.

Capital Gains Tax

Foreign sellers pay federal capital gains tax on any profit from the sale of U.S. real property, plus applicable state and local taxes. The federal rate depends on the holding period and the seller's tax bracket. In New York, state and city capital gains taxes apply on top of the federal rate. In Florida, there is no state-level capital gains tax.

Why Global Investors Continue to Buy U.S. Luxury Real Estate

Despite the complexity of U.S. taxation and the cost of entry into markets like Manhattan, international buyers continue to allocate capital to American luxury real estate. The reasons are consistent and enduring:

• Portfolio diversification. U.S. real estate provides geographic and currency diversification for investors whose assets are concentrated in other regions.
• Rule of law. The United States offers a legal system that protects property rights, enforces contracts, and provides recourse through well-functioning courts. For buyers from jurisdictions with weaker institutional frameworks, this alone justifies the investment.
• Market depth. New York and Miami are among the deepest and most liquid real estate markets in the world. Properties can be bought and sold efficiently, and the secondary market is active at all price levels.
• Legacy and lifestyle. For many families, a residence in New York or Miami is not purely a financial decision. It provides a base for education, business, travel, and family life — and it can serve as a multigenerational asset that holds its value across economic cycles.

The United States is not the only destination for international real estate investment, but it remains the most open, most transparent, and most liquid. For buyers who value these qualities, the case for U.S. luxury real estate remains compelling.

Frequently Asked Questions