President Obama won the election and for Canadian U.S. real estate investors that means we can expect similar housing policies and procedures. The Feds ‘Operation Twist’ will be in effect until late 2014 so housing rates should stay similar as well. Moving forward, U.S. real estate investors need to recognize that U.S. real estate opportunities are time-sensitive and more and more people are jumping on the bandwagon. Decreasing levels of housing inventory and increased competition means you have to have a solid strategy in place. Best bet: choose your market carefully to optimize low-risk property performing investments through property appreciation.
It’s all about the market…
As a Canadian buying and selling U.S. real estate, the appeal of certain markets within the U.S. is a strategic decision based on a combination of factors, such as: state regulations, the housing market, statistical findings and the availability of U.S. foreclosures. As an experienced U.S. real estate investor and trainer, I perform due diligence methods to apply market analysis then strategy. Once you have identified the type of market you are working within, you can then determine strategy for property investments. Bottom line is, you need to know your market and develop a strategy that aligns accordingly.
Sexy vs. Emerging Markets
Given the current general market conditions in U.S. housing, U.S. foreclosures tend to be a favoured investment strategy among Canadian investors. If you are looking into U.S. foreclosures, you want to focus on emerging real estate markets. An emerging real estate market is one that is experiencing steady growth in population and job statistics. A sexy market is experiencing growth mainly through baby boomer migration. Depending on your level of expertise and resources, you can apply the U.S. foreclosure strategy to buy property, create income and then re-sell over a term of 5 years or so. However, sexy markets have a higher margin of error.
Top 4 U.S. Real Estate Investment States
Recently, the National Realtors Association (NAR) researched trends in international U.S. real estate investments to identify the preferred housing markets over the last year. The findings indicated a preference for emerging markets, which demonstrates the overall strategy of U.S. foreclosures for international investors in the current U.S. real estate market.
Of course, while these four states may represent lucrative investment opportunities, there is still a lot to consider for location within a state. In particular, Florida and California are extremely competitive markets within the U.S. housing market right now, leaving Arizona and Texas as preferred starting locations.
Keep in mind it’s a good idea to research U.S. foreclosure inventory within a state. Once the NAR is reporting on the top 4 international buyer states, it may already represent a depleted market. Step one of market research requires identification U.S. foreclosure inventory levels. From this point, you can perform more in-depth research.