US threat to Spain as a retirement destination

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This topic contains 25 replies, has 8 voices, and was last updated by Profile photo of katy katy 5 years, 1 month ago.

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  • #56398
    Profile photo of peterhun
    peterhun
    Participant

    Have you got $500,000 (£312,000) to spare and hail from anywhere but America? If so, one Charles Schumer of New York wants you to get in touch.

    That half a million dollars, according to Schumer, one of New York’s two Democratic Senators, could be part of the answer to the country’s housing crash. Schumer and Mike Lee, a Republican Senator from Utah, are trying to drum up support for legislation that will entice foreigners to invest €359,000, C$508,000, 78m yen or 3.1m yuan in US residential real estate. And the sweetener: a visa to live here as long as you own the property. Is it starting to look attractive?

    http://www.telegraph.co.uk/finance/comment/8850928/Are-rich-foreigners-the-answer-to-Americas-housing-crash.html

    What half a million dollars will buy you
    http://www.realtor.com/realestateandhomes-detail/2716-Saint-Andrews-Blvd_Tarpon-Springs_FL_34688_M65701-22965


  • #106235
    Profile photo of Anonymous
    Anonymous
    Participant

    A lot more house than you get for €359,000 in Spain.

  • #106237
    Profile photo of peterhun
    peterhun
    Participant

    Great schools nearby. 500m2… even just building in Poland would cost £0.5million++, land excluded. Buy yourself a couple of Glocks, health insurance..

  • #106238
    Profile photo of logan
    logan
    Participant

    I have considered seriously relocating to the US.
    However high property taxes income taxes, business capital gains taxes and local taxes, plus huge medical insurance bills always kills it for me.
    However in real estate you do, as Mark says get a lot more bang for your buck.
    Get rid or reduce the fixed costs and I’m on the next plane to Florida. 🙂

  • #106239
    Profile photo of peterhun
    peterhun
    Participant

    @logan wrote:

    I have considered seriously relocating to the US.
    However high property taxes income taxes, business capital gains taxes and local taxes, plus huge medical insurance bills always kills it for me.

    And once they get their teeth into you your are liable for US taxes for life, no matter where you try escape to.

    There also Community fees, probably $30k per year. Property tax was $8750 in 2010.

  • #106240
    Profile photo of Anonymous
    Anonymous
    Participant

    @logan wrote:

    I have considered seriously relocating to the US.
    However high property taxes income taxes, business capital gains taxes and local taxes, plus huge medical insurance bills always kills it for me.
    However in real estate you do, as Mark says get a lot more bang for your buck.
    Get rid or reduce the fixed costs and I’m on the next plane to Florida. 🙂

    Have to agree on this the taxes are so high particularly in Floriday but what a house for that price. I own a property in spain which I purchased in 2004 for lifestyle rather than investment but they way things are going in spain and with the reintroduction of “wealth” tax and prices continually falling I am nervous about the future of Spanish property prices and have decided to call it a day, take the hit and sell up – it’s too risky! The positive side I have had 7 good years of holidays there with the family and will still holiday in spain but will rent instead.

  • #106241
    Profile photo of logan
    logan
    Participant

    Angela.
    Don’t forget Spanish inheritance tax which applies to the surviving spouse. The equity value of any property is calculated in the overall liability.
    Yet with all the problems of Spain it’s still a cheaper option than the US.

  • #106242
    Profile photo of peterhun
    peterhun
    Participant

    The property tax in Florida seems to be 2% of the value of the house per year. That’s a killer, imagine if house prices boomed again.

  • #106244
    Profile photo of Anonymous
    Anonymous
    Participant

    @peterhun wrote:

    Buy yourself a couple of Glocks, health insurance..

    😆

    I didn’t know property tax was that high in Florida 😯 Guess it’s a good way to keep house prices down, though aren’t they supposed to be doing everything to get them up? Makes Spain’s wealth-tax patrimonio look like a bus fare.

  • #106246
    Profile photo of logan
    logan
    Participant

    @mark wrote:

    @peterhun wrote:
    Buy yourself a couple of Glocks, health insurance..

    😆

    I didn’t know property tax was that high in Florida 😯 Guess it’s a good way to keep house prices down, though aren’t they supposed to be doing everything to get them up? Makes Spain’s wealth-tax patrimonio look like a bus fare.

    The US is often seen by the rest of the world as a low tax economy. It is not, or rather it depends on the quality of your tax accountant and the state where you live. There are more holes in the system than on the roads of Britain and legal evasion is an art form.
    Peter is right even if you live abroad a US citizen still has to pay federal taxes.

  • #106247
    Profile photo of katy
    katy
    Spectator

    Yearly property tax are not usually as high as you have quoted. If you are resident then you get Homestead allowance which reduces the amount by around 70%. Community fees, well you don’t have to live on one. If you do then you get what you pay for and work out a lot less than Spain. Ours includes cable TV (over 140 channels), broadband, front lawn maintainance, golf membership, security etc.

    If we had converted the sale of our villa in marbella to $ we would have had well over $1 million. $500,000 would buy us a much better property than we had. Buying costs were only 1% when we bought in Florida, Surplus would cover medical fees for a while! Taxes aren’t punitive like in Europe, there are lots of allowances you can claim for.

    Unfortunately, I don’t think it will happen. There was a similar (retirement visa) going through when 9/11 happened and it collapsed. Anyway, I can dream :mrgreen:

  • #106248
    Profile photo of logan
    logan
    Participant
  • #106251
    Profile photo of katy
    katy
    Spectator

    Already have a B-2 which allows 6 months stay. E-2 is unstable, only good if the business continues to be successful. Has to be renewed every few years if not you can be turfed out instantly. EB-5 is in most cases a legal scam. I am on a Florida forum where many Brits have fallen foul of these immigration experts with websites. We had thought of going the E-2 route in the late 90’s but thank God for forums we decided not to.

  • #106259
    Profile photo of peterhun
    peterhun
    Participant

    katy
    Is the Home Ownership Association fee the community fee?

    The HOA fee is $157, which I assume is per month.

  • #106260
    Profile photo of katy
    katy
    Spectator

    Yes correct. Some are more restrictive than others. They tend to be more popular in places like Florida and Arizona etc. where there are a lot of second home owners.

  • #106262
    Profile photo of Anonymous
    Anonymous
    Participant

    Thanks for posting this Peter.

    This proposed bill seems to have legs (it appears to have the approval of the WSJ and other big players). Did the 9/11 proposal have ths kind of momentum? If the bill were to be passed, does anyone have an idea of the kind of timescale from being heard, passed (fingers crossed) and up and running? I’d be off to Hawaii in the morning.

  • #106263
    Profile photo of GarySFBCN
    GarySFBCN
    Participant

    Regarding the cost of living in the US, excepting the need for health insurance and other medical costs, almost all consumer items and food are much less expensive in the US. Shoes that are 150euros can be had in the US for $40, or about 28euros. Ditto for most clothes, computers and technology, food and gasoline.

    There are some regional difference in costs, but overall it is MUCH less expensive in the US.

  • #106264
    Profile photo of peterhun
    peterhun
    Participant

    Gary,
    I take it you are not a Primark shopper? Most people seem more than happy to shop there and pay the equivalent of $40 for shoes. Last time I paid even half of 150euro’s for shoes was in New York as it happens. If you are on a budget Primark et al. are the places to shop – even Polish people fly to the UK to shop for clothes becuase UK is a cheap.

    USA is cheap, but the quality of food and clothes is generally ‘you get what you pay for’ and quantity over quality is the norm. You can’ see taste, so they don’t sell it. Meat is pumped with anti-biotics (although belatedly becoming illegal like the EU). Fish (eg Tuna) can be chemically treated to look fresh even when rotten (again illegal in the EU). You can get quality food but you have to pay more, similar in the UK cheap food is there but you have to seek it out.

    I also find cheap US clothes are too big for me and made for a fuller figure. Gasoline is cheap but it has to be as you will be using a lot of it just to survive and don’t forget the thousands you may have to pay in state road tax -its a fixed cost.

    My US workmates/employees need big bucks just to live, they don’t say its cheap and easy living there.

    @Snowy wrote:

    I’d be off to Hawaii in the morning.

    Don’t get you hopes up, Hawaii property and living costs are high and they may not allow it there as the locals are already under pressure. Can’t see the point of choosing a tropical island in such demand by Americans becuase its American if you are not a citizen. May as well be live on a island like Reunion, tropical, French food and its in the European Union, and there are cheap direct flights from Paris

  • #106265
    Profile photo of katy
    katy
    Spectator

    I don’t know where you get this rubbish from. 😆 USA clothes are far better quality in the middle range. I always buy loads when there, as does everyone else I know. Primark is crap, ok for 17 yr olds who throw them off after a couple of weeks.

  • #106266
    Profile photo of peterhun
    peterhun
    Participant

    @katy wrote:

    I don’t know where you get this rubbish from. 😆 USA clothes are far better quality in the middle range. I always buy loads when there, as does everyone else I know. Primark is crap, ok for 17 yr olds who throw them off after a couple of weeks.

    Glad you like it. Doesn’t mean I have to.

  • #106270
    Profile photo of kgpoc
    kgpoc
    Participant

    Net, net the US is cheaper in the ‘paying for anything department’. Effectively insuring your life/heath/well being is the only extra real cost there. You can easily live cheap in so many places in the US and find work (you will work much longer hours and more rewarding).

    BUT it is so hard to live cheap.. The life style and social interaction is set up for you to spend, your friends do it, you do it, you go out to eat, you meet up at Malls for expensive coffee.

    I believe quality of life for a lower cost, Spain beats it hands down.

  • #106271
    Profile photo of GarySFBCN
    GarySFBCN
    Participant

    Net, net the US is cheaper in the ‘paying for anything department’. Effectively insuring your life/heath/well being is the only extra real cost there. You can easily live cheap in so many places in the US and find work (you will work much longer hours and more rewarding).

    Agree, except that I think that US energy costs (home heating/cooling) are a lot higher. Solution for that: Live somewhere where there is little need for cooling and heating. Not everyone can do this.

    BUT it is so hard to live cheap.. The life style and social interaction is set up for you to spend, your friends do it, you do it, you go out to eat, you meet up at Malls for expensive coffee.

    Disagree. One can create whatever life they want. I have not visited a mall in years, but then, I live in a city (San Francisco).

    I believe quality of life for a lower cost, Spain beats it hands down.

    Agree with that quality of life is far better in Spain. But I worry that if Spain’s austerity measures are too severe, we will see the ‘Americanization’ of the Spaniards and Europeans too. We in the US have to worry about access to health care, even those of us who are well insured. And most of us have to worry about retirement. This leads to high levels of stress, long work hours (because you have to keep your job to keep your health insurance for you and your family), people struggling just to keep ahead.

    If the solution to Spain’s economic problems mean lower pensions, less health care, questions about the future etc, (which will cause less ’emotional security’), watch for stress levels rise to what we have here in the US. And while I abhor religion, I think that the Protestant ‘work ethic’ that is part of our US culture feeds into this pattern of stress, and the ‘Catholic’ approach seems more livable.

    While there are many fantastic aspects to the US, to borrow from Wilde, we in the US know the price of everything and the value of nothing. I’d hate to see Spain or any other country mimic this approach to the economy and to life.

  • #106273
    Profile photo of peterhun
    peterhun
    Participant

    @garysfbcn wrote:

    I’d hate to see Spain or any other country mimic this approach to the economy and to life.

    I don’t see it happening becuase its utterly inefficient. US spends 16% of GDP on health care and has far lower levels of health than ‘socialist’ countries who spend half that amount.

    the price of everything and the value of nothing

    That’s an accurate assessment.

    It results in very short term thinking that end up costs far more in the long term. Penny wise, pound foolish to use an English idiom.

  • #106274
    Profile photo of katy
    katy
    Spectator

    Do any of you know anything about living and working in Spain or have you just been googling stats! What makes you think spaniards work less hours than an American? Not only do many have to commute twice a day because of 2 hours off for siesta there are complaints of having to work unpaid overtime. Spain not as stressful..not for a foreigner with an outside income who doesn’t need to work:roll:

    The workers in the garage that serviced my car started work at 8am finished at 2pm started again at 4pm finished at 7pm. Saturdays 8am until 1pm. People who work in the service industry have even longer hours. That is if they have a job of course with unemployment at 21% (30%+ in andalucía)

  • #106276
    Profile photo of kgpoc
    kgpoc
    Participant

    @katy wrote:

    Do any of you know anything about living and working in Spain or have you just been googling stats! What makes you think spaniards work less hours than an American? Not only do many have to commute twice a day because of 2 hours off for siesta there are complaints of having to work unpaid overtime. Spain not as stressful..not for a foreigner with an outside income who doesn’t need to work:roll:

    10 years in the US
    6 years in Spain (2 in BCN (#2 largest city in Spain – 45 minute commute) , 4 year in a smaller city)
    Yeah – I am quite qualified in this subject – how about you?
    As for the 2 times a day commute – Americans take their lunch to work and eat at their desks while working and that hour is usually unpaid. So the Spanish worker could do the same but decides not to!!

    As GarySFBCN rightfully pointed out, you also have all the pressure of your health care costs, retirement payments and no guarantee of any money the day you are fired, regardless of how many years!

    The Spanish work/employment ethics are at the heart of their ability to extract themselves from this crisis. I am not saying this is the only reason for why they are in the crisis, but it is basically their only controllable variable to get out, and they are getting an F Grade so far. (This is not meant as any disrespect to any Spanish friends and family members, many of them agree)

  • #106277
    Profile photo of katy
    katy
    Spectator

    Yeah, I am qualified allright. Can’t be bothered to respond to this utter rubbish 🙄

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