Reasons to Invest
The market conditions in the US make it an ideal location for a real estate investment, with government-backed rental assurance and an economic recovery underway the potential for profit is unrivalled.
A population of 305 million people, 3.79 million square miles and 50 states combine to make the third largest country in the world. Since the 1870s, the US has had the largest national economy in the world since the 1870s, producing 23% of global GDP.
As a leading global economic, political, and cultural force, the US is simultaneously one of the top three exporters of the world and the largest importer. It is the largest consumer market in the world and the top export market for 60 trading nations worldwide.
The countrys property market focus has been around major cities, large university towns, and tourist hotspots. With major cities including New York and Los Angeles, industrial cities such as Detroit, as well as the sunshine and beaches appeal of Florida, the US has a cultural and economic strength that consistently attracts property investors.
The long-term appeal of these destinations has kept the real estate market strong for many years, until the property market collapse in 2007. The stock of the countrys largest subprime lender, New Century Financial, plunged 84% amid Justice Department investigations, before the company filed for Chapter 11 bankruptcy on 2nd April 2007, with liabilities exceeding US$100m. This sent property prices into a downward spiral as bad debts mounted up.
According to NAR data, sales were down 13% to 482,000 from the peak of 554,000 in March 2006, and the national median house price fell nearly 6% in 2007 to US$217,000 from a peak of US$230,000 in July 2006. On 30th December 2008, the Case-Schiller home price index reported its largest price drop in history.
Fast forward to 2010, and whilst the country is out of recession and the economy is in recovery, the housing market is still creating distressed sellers. Overall, it is projected that 1 out of every 200 homes will be foreclosed upon and owned by the bank. Every three months, 250,000 new families enter into foreclosure.
For property investors, this has created an opportunity. Go Investment has acquired bank-owned properties for well below market value. The properties are already valued at more than the purchase price, and as the economy recovers, these properties will grow in value.
Until then, as part of its regeneration programme, Section 8, the US Department of Housing and Urban Development are putting tenants into homes, creating the potential for rental yields of up to 25% on below market value properties.
Go Investment have properties available across a number of locations, chosen to maximise income potential at a low entry price.