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How The World Turns: US Property Investment Now A Great Bet

Martin Sadler

Qualitas Property International

23 July 2012

Pockets of the US property market currently present some very attractive investment opportunities, according to Martin Sadler, operations director at London-based Qualitas Property International. Here, he gives readers his views on where to invest.

Below are our top five picks of the very best places right now to invest in the US. Prices today in the US are up to 70 per cent under their peak values before the market crash in 2006.  With signs of recovery already being reported, (house prices have again showed their second year-on-year increase) prices will continue to steadily increase making this a unique window of opportunity to invest in the US if you can find the right deal.

1.   Atlanta

With a growing population of young professionals and over 5.5 million residents, the greater Atlanta area has been the fastest-growing metropolitan market in the US for the past decade. It has a rapidly growing economy and tax-efficient policies which make this area one of the healthiest residential and investment markets in the States.

Forbes magazine ranks Atlanta as the number one home market in the US and ranked Atlanta as the number one rental market in the country. As the capital city of the State of Georgia, Atlanta is the travel and business hub of the southeast region of the States and boasts some of the strongest economic indicators for substantial short-term cash flow and long-term potential capital growth.

Top pick: In Atlanta we can buy a four-bedroom house build in 2006 for $90,000, renovated and with tenants in place and achieve an annual rental income of over $12,000. 

2.   Cape Coral

Cape Coral, a city in Florida which consistently ranks in the top ten places to open a business and CNN called it the fifth fastest-growing US city in the past decade. The land in Cape Coral is currently up to 75 per cent under its peak values since 2006, meaning that once construction starts, land values in desirable areas will increase dramatically.  Land in Cape Coral has the potential to at the very least double in value in the next three to five years, making it a sound investment. 

Top pick: “Cape Coral - Land investment focus: we can currently purchase a 10,000sq.ft land plot with full planning permission to build a 3-4 bedroom home for just $15,000.  This same plot would have sold for $90,000 back in 2006."

3.      Orlando 

Orlando is still one of the most popular destinations in the States to visit, with Disney remaining one of the most popular tourist destinations in the world. However, what makes Orlando one of the best places to buy now is that it saw one of the largest drop in prices during the crash, meaning that prices will increase dramatically over the next five years, and there is a consistently strong rental demand. This means now you can buy a property up to 70 per cent under its peak values in 2006, ensuring massive gains. 

Top pick: “We can purchase a two-bedroom condo in Orlando with up to a 70 per cent discount from peak prices in 2006, currently for $59,000 (50 per cent below construction costs) with a tenant in place generating between $6-$8,000 a year.  Expect prices to increase strongly over the next five years, as these deals disappear and the market returns to levels above the cost of construction.”

4.   Miami

There are still deals to be had here, with the ability to purchase incredible homes which are already tenanted and will consistently achieve a secure rental income whilst prices increase.  This is the higher end of the market in Florida with heavy competion from South American investors, so finding a strong investment property is becoming increasingly difficult in a  city that  is seeing property values increase and that offers top-tier rentals.  

Top pick: “We can pick up three-bedroom luxury townhomes in gated community at $102,900 (70 per cent discount from 2006 peak values) with long-term tenants generating $8000 per year rental income.”

5.   New York

Many foreign buyers have started looking at New York for investment and this is spot on. 

More foreign buyers have been drawn to New York recently and unlike other cities property values in the US were protected during the market crash, but, like most major world cities property is always desirable. This is not for the average investor as the opportunities are more expensive but there are good residual values. 

Top pick: “We can purchase developer-discounted apartments just off 5th Ave and Central Park for $600,000, have a tenant paying and still achieving 5-6 per cent net rental income.”