Below are the top 7 reasons why investing in US property is a once in a lifetime opportunity for Australian Property Investors that they should take advantage of right now. It will not always be ideal to invest in US Property, there are a lot of factors to consider and for the reasons below the timing is right at the moment, which will only be the case for a relatively short time.
1) Our Strong Aussie Dollar
Recently the AUD has achieved its best exchange rate against the USD in history, at one point valued over US$1 and it's still holding strong with no expectation this will change any time soon, given the state of the Australian and American economies.
Recently the AUD has achieved its best exchange rate against the USD in history, at one point valued over US$1 and it's still holding strong with no expectation this will change any time soon, given the state of the Australian and American economies.
2) US Properties are on Sale
The massive drop in house prices has occurred as a result of the following issues - the impact of the non-recourse loans on offer previously in the States, the 2008 banking crisis, increasing unemployment rates and the impacts of the GFC. The drop in prices is so high that Aussies can actually purchase already discounted houses in the US, in good areas, valued at 50-70% off their market value, which is less than the price of stamp duty on an average home in Australia!
The massive drop in house prices has occurred as a result of the following issues - the impact of the non-recourse loans on offer previously in the States, the 2008 banking crisis, increasing unemployment rates and the impacts of the GFC. The drop in prices is so high that Aussies can actually purchase already discounted houses in the US, in good areas, valued at 50-70% off their market value, which is less than the price of stamp duty on an average home in Australia!
3) Over 100 US banks have gone bankrupt since the GFC
Many US banks are now too scared to lend to local home buyers and they are burdened with debt, which has opened the doors for International Investors.
Many US banks are now too scared to lend to local home buyers and they are burdened with debt, which has opened the doors for International Investors.
4) US Buyers aren't in the Market
Loans are too hard for most to get and others are concerned about rising unemployment and the overall state of their economy.
Loans are too hard for most to get and others are concerned about rising unemployment and the overall state of their economy.
5) Poor Credit Ratings
FICO is the most common credit assessment model in the US. Due to the high number of people who have either lost employment, defaulted on bills or walked away from their mortgages, millions of people in the US now have a low FICO credit score.
FICO is the most common credit assessment model in the US. Due to the high number of people who have either lost employment, defaulted on bills or walked away from their mortgages, millions of people in the US now have a low FICO credit score.
6) Lenders want International Investors
Due to the weakness of the US economy, lenders are preferring international investors, which was not previously the case. According to the recently released "2011 Profile of International Home Buying Activity" from the National Association of Realtors, the value of international residential purchases in the US surged $16 billion from $66 billion to $82 billion in the year ending March 2011.
Due to the weakness of the US economy, lenders are preferring international investors, which was not previously the case. According to the recently released "2011 Profile of International Home Buying Activity" from the National Association of Realtors, the value of international residential purchases in the US surged $16 billion from $66 billion to $82 billion in the year ending March 2011.
7) High Rental yields delivering Positive Cash flow
Even though property prices have dropped in the US, rents have largely remained the same, creating historically high gross rental yields, making it possible for Australians to affordably purchase high yield positive cash flow properties.
Even though property prices have dropped in the US, rents have largely remained the same, creating historically high gross rental yields, making it possible for Australians to affordably purchase high yield positive cash flow properties.
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