The Property Investment Market in U.S.A.

Past, Present & Future

The property market in the USA has long been established as a preferential option to overseas investors due to various factors. The market featured stability and high growth potential, along with excellent rental returns in touristic locations and the ease of obtaining financing. Very few restrictions applied to foreign buyers, including agricultural land, and land purchases in Oklahoma. These restrictions did not affect average investors, especially not those interested in the buy-to-let markets.

The collapse of the US property market has been well documented, after the country entered into recession in late 2007. While many factors have contributed to the market downturn, the culmination created devastating effects to the country’s economy.

The recent rectification of the mortgage market has been an essential step in stabilising the excessive lending, along with assisting the future stability of the market. The mortgage market in the US grew at an incredible pace with exceptionally low interest rates over a long period of time. This was coupled with extremely lenient lending criteria that were ultimately unable to support changes.

Massive growth in the real estate market enabled huge returns on investments for buyers over the years. The exceptional growth rate of the US market, ultimately lead to the extreme falls as the property bubble burst.

While it is impossible to place an exact moment for when the property prices will begin to stabilise and start to grow once again, it is predicted that growth in the overall market may not be seen for another two years. For foreign buyers, real estate in the USA is presenting various unbeatable options for an established market.

Foreclosed properties allow for prices at an all time low, coupled with very favourable exchange rates. While the market is not advisable for short term investors, those who are interested to hold onto their purchase and sell in the mid to long term, can expect to enjoy considerable gains. This purchasing option also allows for rental yield gains and a property to enjoy during holiday seasons for personal use.

While the immediate future for the US property market may appear quite bleak, the government has created recovery and stabilisation plans. The mortgage market has undergone an overhaul and economic aid has been introduced involving tax cuts and the creation of new jobs.

It is expected that the recovery of the US real estate market will present investors who have entered the market in its present conditions with exceptional gains. The future of the market is expected to develop with a mature attitude after the lessons learned from the market’s recent history. As the USA features a continuous demand as an established market, the future should present stable long term investment options for steady and secure returns.

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