Florida and Texas have enacted some of the most restrictive laws in the United States of America (USA), prohibiting Chinese citizens, as well as Cuban, Iranian, North Korean, Russian, Syrian and Venezuelan citizens, from owning any real property. Exceptions are very limited and apply primarily to individuals who have a permanent USA resident visa or citizenship status. As such, these Chinese and other citizens are legally prohibited from purchasing or otherwise acquiring any real property in Florida or Texas. Real property includes land, buildings, and other structures, such as houses, commercial properties, etc.
Over 30 other USA states have enacted significant, but less sweeping, legislation restricting or prohibiting real property ownership by foreigners, with citizens and businesses from China being the main target. These laws are primarily justified based upon national security and agricultural sovereignty concerns. These states have mostly enacted more limited bans focused on agricultural land and land near military installations and high value infrastructure, such as airports.
States enacting restrictions include, but are not limited to, Alabama, Arizona, Arkansas, Idaho, Indiana, Kansas, Mississippi, Missouri, Montana, Nebraska, North Dakota, South Carolina, South Dakota, Tennessee, Utah, Virginia, West Virginia, Wisconsin and Wyoming. This area of the law is relatively new and dynamic. We expect that other states will follow suit and that there may also be challenges to the validity and constitutionality of these laws in the courts. To date, such legal challenges have been unsuccessful and the laws have been found valid, constitutional and enforceable.
Urban Thier & Federer, P.A., has helped many 100s of foreign nationals understand their legal rights, especially where they have entered into real estate purchase contracts for the purchase of real property in the USA and paid deposits related to same. Attorney John L. Urban has been the lead attorney on many 100s of state and federal court lawsuits representing foreign nationals who are parties to real estate purchase contracts for the purchase of real property in the USA.
Real estate contracts typically contain force majeure, frustration of purpose, illegality, or impossibility of performance type clauses, which may be triggered by these laws where the purchaser is prohibited from taking ownership. However, terminating your contractual obligation and recovering your deposit or earnest money funds is not automatic. To legally terminate or break the contract without forfeiting your deposit or earnest money payment, you should review your purchase agreement with a licensed attorney with experience in this area of the law. An attorney who represents your interests and who can issue a formal demand letter or rescission notice to the seller and any escrow agent holding your deposit or earnest money funds.
If your interests might be affected by these laws, it is critical that you act promptly. Sellers often seek to have purchasers declared in breach of the purchase agreement or real estate contract on contractual grounds and then seek to have all deposit funds released to the seller as liquidated damages. You carry the burden to raise any issues, such as the illegality, that may allow you to terminate your contractual obligations and receive back you deposit funds. Purchase agreements or real state contracts are almost always written by the seller’s attorneys and in the seller’s favor. It is easy for unsuspecting purchasers to be found in breach of the contract for various technicalities, allowing the seller to legally receive the entire deposit funds as well as an additional award of attorney fees and costs.
At Urban Thier & Federer, P.A., we do not represent sellers or developers. We represent purchasers and have helped many 100’s of purchasers terminate their real estate contracts and receive back deposit funds. We are so confident of our ability to help you in this area of the law that we handle most cases on a No Win No Fee basis. This means that you pay us nothing unless and until we recover funds for you. Again, we encourage you to take immediate action to explore your legal rights by consulting with us or another law firm of your selection. You should avoid and not work with any attorney or law firm connected to or recommended by the seller. Contact us to explore your legal rights and available options.