ask george & chuck
June 22, 2009

Unknown inspectors, foreign buyers
Answers to real estate questions as appearing
in the Houston Chronicle

Dear George: I had a buyer for my house terminate the contract due to an alleged structural defect found by his inspector. The buyer declined to give me a copy of the report and refused to tell me who performed the inspection. I've since had a real estate inspector come out and look at my home. He cannot find any structural defects in my home. My real estate agent states that I have to disclose the fact that some mysterious inspector claims that my house has a structural defect. Do I have to disclose this issue on my disclosure form?

Answer: Yes. However, since you don't have the buyer's report or the name of the buyer's inspector, you need not elaborate. Write something like this: "A previous purchaser had my home inspected, and the inspector allegedly told him that my house had a structural defect. When I disagreed with the repairs submitted by this potential buyer, the buyer terminated the contract, would not provide me with a copy of the inspection report, and would not reveal the name of this inspector. I have since had my home inspected, and my inspector found no structural defects. A copy of this inspector's report is available."

Dear George: Can a foreigner—no Social Security number, no U.S. citizenship—purchase real estate property in this country? Will that person need to form a company to do so?

Answer: Generally speaking, there are no limitations on ownership of U.S. property by foreign nationals of countries that are at peace with the U.S. An individual foreign national can purchase U.S. real property without having to form a company. That person will most likely have to have a taxpayer identification number. When the person sells the property, they'll most likely have to pay federal taxes in accordance with the Foreign Investment In Real Property Tax Act. Some states also have laws that treat purchases by foreginers differently than those by U.S. citizens.