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The US Government will pay me $36,500 to rent out property in the USA

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  • The US Government will pay me $36,500 to rent out property in the USA

    I have just agreed to buy 3 duplex (pairs) of 3 bed 2 bath houses in the USA for $32,000 downpayment each and will get a payment back from the federal government of $73,000 for each, positive cashflow of over $40,000 per duplex (approx £20,000).

    I went to a presentation last week about property in the Go Zone in the USA. If you have not already heard about it, this is an extended area of the southern USA which was affected by hurricanes Katrina and Rita a couple of years ago. The US Government is pouring billions of dollars into the area to revive the economy and provide low cost housing for displaced residents and newcomers entering the area to work. They need to build over 60,000 properties to satisfy demand.

    In certain areas of Mississippi, the development authority have established a Small Rental Assistance Program (SRAP) to provide affordable rental properties for everyone during these times of high rental demand. What I like about the deal is that the incentive is from the US federal government and not a fake cashback scheme from a developer.
    I think this is such a good deal that I want to let as many people know about it as possible. I don’t want to sell it to them, but let them do their own research and deal with the companies directly themselves.

    There is plenty of information available on the internet about the area and the funding. The developer is represented by Danny Silver who is well respected in the US property market and manages Property Direct Group. His UK based partner is Tony Staniforth at Investment Property Direct. They will be arranging further seminars in June which Danny will present and details will be available from their websites. If you are interested let me know and I'll give you the contact details.

    This is such a no-brainer deal for me that I have committed to 6 properties which is the maximum number for which an individual investor can get the SRAP funding. So by investing $96,000, which covers a 10% deposit and all closing costs, I will have 6 brand new properties to rent in a high demand area and $219,000 back from the US government. Where else can you find a deal like this? Check out the websites and do your own research into the Go Zone and SRAP then go along to one of their free seminars.

  • #2
    I couldn't put the website addresses on the post because I haven't done 5 posts yet. If you can't find them by search engine, then contact me with a PM and I'll let you have them with pleasure.

    Regards

    Paul

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    • #3
      I don't really understand how that works....why would the government give money back?

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      • #4
        The money is a grant from the government to investors to encourage the building of housing to be made available and rented to the local workforce.

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        • #5
          Okay, what's the catch?

          I presume there are some pretty clear restrictions attached to the grant - aren't there always?

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          • #6
            Hi Brian

            There is no catch, the money is from the US Government. The SRAP funding is only available in certain counties within the Go Zone and there are clear requirements laid down by the Mississippi Development Authority (MDA) to qualify for the funding.

            The developers I am buying from are building properties that do qualify. They prefer to submit the application paperwork on your behalf to ensure all parts are completed correctly. If, for any reason, the application for the SRAP funding is rejected, they will buy back the property from you if you do not wish to proceed, provided they completed the application.

            Having said that, many investors are apparently not going for SRAP because there is so much upward pressure on rents in the open market due to the shortage of and high demand for rental properties, that they feel they can make more money that way. I am applying for SRAP and will use the funds to buy further properties outside the scheme.

            For more info check out Property Direct Group website which has links to independent websites, or you can Google the Go Zone and there are about 16m pages to choose from. The best independent site is gozonegateway which has links to the MDA IRS etc.

            Regards

            Paul

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            • #7
              Ah, I've just re-read what you wrote, and it seems that it's just an incentive scheme to get people to buy low grade "affordable housing", with the govt providing coverage of initial costs.

              So it's basically a case as to whether you target an ideal investment locale, and put money in that - or else get distracted by a govt incentive which offers better short-term interest but possibly has the catch of not so good long-term advantages.

              You picks your horse, you takes your chances I guess.

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              • #8
                We back this. Danny and his team are good guys in our opinion. People must weigh up the investment, but it is backed by government incentives in tax and cash back. The only people who can sell are licenced in the USA. Check out Go Zone. There is further information on our site, or simply use search engines google, and yahoo and type in Go Zone incentives. Federal US government.

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                • #9
                  Brian

                  This is a regeneration area where the US government has spent billions of dollars to encourage business and industry to the area to provide jobs to make the area prosperous again. The industry and jobs are now there and growing more, and now there is a massive need for houses for all the people who work there, thousands of whom are still living in temporary trailers.

                  So this is a great locale for buy to let investors with the added benefits of government grants and tax concessions. No amount of words on this Forum can make up for an hours research on the internet (on independent websites, not just the developers).

                  Regards

                  Paul

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