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Across The Pond, Part Two

Veteran international investor John Corey updates us from the USA

I was briefly in the UK for the first ten days of June. Then back over to the USA. I am enjoying the summer weather in a more rural location than if I was back home in Zone 1, London.

While in the USA, I have been attending local real estate (property) investing meetings. Some of these go by the label of REIA (Real Estate Investment Association). A tip for anyone traveling to the USA and wanting to get local insight; most states have local REIAs. They hold meetings and are not part of a commercial national training company. If you find you are in a location when the REIA monthly meeting is happening, drop-in. You will find it fascinating. So similar and yet so different from what you experience in the UK.

Observations: I made a couple of repeat visits to the Saturday morning meeting I have been attending in Philadelphia. About a dozen people attended, give or take, all sitting around a table for a morning coffee. The format is to agree three questions and then discuss each until the group feels the topic has been covered. Syndication, ‘playbook’, wholesaling, creative finance for a primary residence and others topics have come up at the last two meetings. Let me focus on some that are least likely to be discussed at a meeting in the UK.

In the USA, you need to hold a valid real estate agent’s license if you are expecting a fee for matching a buyer and a seller. Similar to how someone who sources deals in the UK needs to register as an estate agent. In the USA, all real estate agents pass a test before they can be issued a license. Individual states issue licenses. If someone held a license in Pennsylvania, they could not operate in the next state using the PA license. It is possible to become licensed in multiple states if you pass the exam for each jurisdiction. Holding numerous licenses is more common when a metro area crosses state lines.

‘Wholesaling’ is all about finding a deal, getting it under contract and then selling what you own, a legal agreement. In other words, you are not brokering a property or trying to collect a fee. You have done the work to secure a property by putting it under contract. Then you sell your asset, the contract. You are not selling the underlying property. Remember, the USA uses a different model for the purchase process. Let me explain.

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