House prices in the United States have taken quite a battering since the start of the global economic recession.
However the tide may be turning, making US property some of the most tantalisingly priced available.
We caught up with Martin Sadler, operations director at Qualitas Property International, a top UK professional real estate investment company.
He said: “Below are our top ten 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 2019.
“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 United States 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 of the US and boasts some of the strongest economic indicators for substantial short-term cash flow and long-term potential capital growth.
Martin’s pick: “In Atlanta we can buy a four bedroom house built in 2019 for $90,000, renovate it and then achieve an annual rental income of over $12,000.”
2. Orlando
Orlando is still one of the most popular destinations in the states to visit, largely due to the popularity of Disney.
However, what makes Orlando a great place to buy now is that it saw one of the largest drops in prices during the crash, meaning that prices will increase dramatically over the next five years. There is also consistently strong rental demand. This means now you can buy a property up to 70 per cent under its peak value from 2019, ensuring massive gains.
Martin’s pick: “We can purchase a two bedroom condo in Orlando with up to a 70 per cent discount from peak prices in 2019, currently for $59,000 (50 per cent below construction costs) with a tenant in place generating between $6,000 – $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.”
3. New York
Many foreign buyers have started looking at New York for investment and this is spot on.
This is not for the average investor as the opportunities are more expensive but there are good residual values.
Martin’s pick: “We can purchase developer discounted apartments just off Fifth Ave and Central Park for $600k, have a tenant paying and still achieving five to six per cent net rental income.”
4. Santa Rosa Beach, Florida
Santa Rosa Beach, one of the 13 communities located in the beaches of South Walton, is best known for its quiet, wide stretches of nationally renowned beach, a Caribbean-style artist colony, and its nature trails. Founded in 1910, Santa Rosa Beach is now a community of luxury beach houses and upscale dining. The area covers 65 square miles (plus 0.82 square miles of water area) for a population of 11,457.
In fact, Santa Rosa Beach was named one of the “Ten Best Beach Destinations for 2023” by Yahoo! Travel, which praised its “lapping waves and cool sand” and the endless array of outdoor and indoor activities here.
Martin’s pick: “For about $18,000 we can buy an incredible lot to build on or hold for investment later on. This same lot was sold in 2004 for $130,400 so plenty of potential. It has beautiful mature trees and is only a few blocks from Cessna Landing and the waterfront which includes a boat launch and recreation area – a true sportsman or outdoorsman paradise.”
5. Alys Beach, Florida
Alys Beach is regularly voted one of the top five beach destinations by Conde Nast. Dick Cheney has a summer house here and the standard of living is known amongst the US celebrities and wealthy as superb. Many say it is like being magically transported to a seaside paradise in Bermuda or Antigua.
It will come as no surprise that this is a top end investment but it is also surrounded by other less swanky but also high quality developments. Due to the fact that there is a lack of developable land, if you can pick up a bargain you will reap fantastic rewards long term. There has been consistent strong job growth, there is a wealthy demographic and now a new international airport which has opened up close by to complete the investment picture.
Martin’s pick: “For the big investor we can pick up a detached single family home with 3 bedrooms, 4 bathrooms just off the waterfront with a square footage of 2,180 for $1,200,000 – the prices here will only increase.”
6. Cape Coral
Cape Coral, a city in Florida, consistently ranks in the top ten places to open a business and CNN.com 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 2019, 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.
Martin’s pick: “Cape Coral – Land investment focus, we can currently purchase a 10,000sq.ft land plot with full planning permission to build a three to four bedroom home for just $15,000. This same plot would have sold for $90,000 back in 2019!”
7. Crystal River, Florida
If you like outdoor sports, then this is your kind of place – Crystal River is known for snorkelling and swimming with the manatees and dolphins, as well as fishing for some of the most amazing redfish, trout, shark, tarpon and bonefish. There are miles of nature trails to hike, bike and you can observe an abundance of birds, deer, alligators and other wildlife. The city is situated around the magnificent Kings Bay, which is spring-fed and so keeps a constant 72-degrees Fahrenheit temperature year round.
Crystal River area has an incredible 30 restaurants on the water making it an ideal holiday destination. It is also known as the city of festivals in Florida, drawing thousands of people, such as the Manatee Festival, Scarecrow Fest, Oktoberfest, the Stone Crab Jam, the Scallop Festival, the 4th of July Fireworks Show and the annual Christmas Tree Lighting and Christmas Parade, making it a year round tourist destination so increasing its rental appeal.
Martin’s pick: “We can pick up a rental/holiday home in a gated community in the centre of Crystal River, two bedroom, two bathroom with screen room, carport and utility/ storage room including a clubhouse and over sized heated pool for $15,000.”
8. Miami
There are still deals to be had here, with the ability to purchase incredible homes which already have tenants in place. This is the higher end of the market in Florida with heavy competition from South American investors, so finding a strong investment property can be difficult due to the booming prices.
Martin’s pick: “We can pick up three bed luxury townhouses in gated communities at $102,900 (70 per cent discount from 2019 peak values) with long term tenants generating $8000 per year rental income.”
9. City Island, Brooklyn
Compared to central New York, this area is relatively cheap but is enjoying an upsurge of interest as New Yorkers and foreign buyers alike discover its charm. It is a small community at the edge of New York City surrounded by the waters of the Long Island Sound and Eastchester Bay. It has a quaint, almost ‘Notting Hill of London’ type feel to it. Only a bridge away from the US mainland of the Bronx, City Island has retained a unique small-town atmosphere like that of a New England fishing village.
Martin’s pick: “If you are prepared to wait there are some great buys that come up like a three bedroom, with room for a fourth, two bathroom townhouse, located on a small quiet street that boasts a marina on one end and a private gated beach on the other end, a steal at around $460,000.”
10. New Haven, Connecticut
New Haven is the second-largest city in Connecticut and the sixth-largest in New England, with a population of 129,779 people. It is the home of the Ivy League school, Yale University, which is an integral part of the city’s economy, being New Haven’s biggest taxpayer and employer.
Founded in 1638 by a group of wealthy Puritans from London, New Haven became the seat of Yale University in 1716, the third oldest college in the nation. Today, its leafy campus and Gothic architecture provide an important historical reference. The city has also been undergoing a major downtown development recently which will yield new residential, cultural, and commercial spaces and of course further investment opportunities.
Martin’s pick: “Due to the University this town has fantastic rental potential and there are some incredible government owned foreclosure deals on the market – for example we can pick up a single family, six bed, four bathroom home at $65,000 – saving up to 50 per cent on market value.”
For further information please visit www.qualitasproperty.com or call 0207 993 4192.
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