Florida Real Estate, Tourism and Immigration News

From today’s Global Edge

US Tops Overseas Property List For First Time!

The overseas property market for Europeans buying abroad has always been dominated by France and Spain.

When you study the absolute numbers of northern Europeans buying abroad, Spain and France have always led the pack by some distance.

Well not any more. At least that’s the message coming from English-language overseas property portal, TheMoveChannel.com. Its monthly rankings of searches on its network of overseas property sites shows US property is now narrowly ahead of both Spain and France.

The US has been moving steadily up the rankings no doubt driven in part by the negative news on the eurozone and the relatively benign press coverage of the US real estate market.

Managing Director Dan Johnson comments: “After climbing three places in as many months, the US continues to attract more and more overseas investors. Florida remains a popular lifestyle choice and with US houses the most affordable they have been in 15 years, the troubled Eurozone just can’t compete with the low price of American real estate. It’s no coincidence that the US is the only country to rise above the four familiar European markets”.

Investment bias

Like any research, the conclusions of TheMoveChannel.com’s report are only as good as the sample. The portal has one of the largest audiences in the industry, second only to Rightmove in the UK overseas property market. However, its audience has always had a bias towards investors who care less about travel time than traditional lifestyle buyers.

Rightmove’s latest rankings show France top (428,312 searches) Spain second (385,737 searches) and US third (212,309 searches). US property has increased its share of the market massively over the past 18 months but in terms of the lifestyle overseas property market in the UK, it still have some way to go to knock Spain and France off the top spot.

Top 20 overseas property searches on TheMoveChannel.com in November

Country % Move

1 USA 16.21% Up 1
2 Spain 15.63% Down 1
3 France 7.93% Non-mover
4 Portugal 6.91% Non-mover
5 Italy 4.66% Non-mover
6 Brazil 4.49% Up 4
7 Bulgaria 3.62% Up 2
8 Turkey 2.63% Down 2
9 Cyprus 2.39% Down 2
10 Greece 2.07% Up 1
11 Cayman Islands 1.83% Up 11
12 Cape Verde 1.86% Up 5
13 Barbados 1.74% Non-mover
14 Germany 1.56% Non-mover
15 Thailand 1.54% Down 7
16 Malta 1.41% Down 4
17 Poland 1.26% Up 1
18 India 1.18% Up 1
19 Morocco 1.17% Down 4
20 UAE 1.13% Up 3

Source: Global Edge

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Orlando Florida (Kissimmee Office) 407 396 9914

British-American Chamber of Commerce Advisory Board

March 22, 2010

From today’s USA Today:

Investors with cash are buying US houses

By Stephanie Armour, USA TODAY

More home buyers are snapping up properties with cash, a trend driven in large part by investors returning to the market after four years of falling prices around the country.
The share of home sales involving all-cash transactions was 26% in January, up from 18% a year earlier, according to the National Association of Realtors. The figures come from a survey of members about their most recent transactions. Many home buyers also are paying cash, but investors are largely using cash so they can avoid paying interest charges on loans and get a larger return on their investment.

Other NAR data also show a pickup in investment activity.

Home purchases made by buyers identified as investors climbed to 17% in January, up from 15% in December and 12% in November.

“We bottomed out in 2008, and in late 2009, prices stabilized and investors have returned,” says Mark Fleming, chief economist at First American CoreLogic. “It’s a different type of investor going after foreclosed properties and expecting to hold on for longer time frames.”

Many investors say they’re financing their purchases with cash on hand, rather than borrowing.

Evan Spinrod of San Francisco bought three rental properties in November and February and now owns 21 in four states. The rent he collects gives him an 8.5% annual return on his investment. Some of his homes are worth about $165,000. “I’m still looking,” Spinrod says. “You can’t build these houses for the prices they’re selling them. I’ve always seen that the real wealth was in real estate. People have been sitting on cash, and there’s no interest from the bank (to pay).”

Leonard Baron, a real estate professor at San Diego State University, has bought three homes with cash in the San Diego area in the past eight months, ranging in price from $100,000 to $130,000. He rents the properties.

Baron says now is an ideal time to make such purchases. “It’s because prices have dropped so much and rents really haven’t,” he says. “The deals were unbelievable.”

Some Realtors also say they’re seeing increased investor activity.

“Flippers, rehabbers, investors … are, in fact, buying,” says Lisa Johnson, with Coldwell Banker Residential Brokerage in Haverhill, Mass. “I’m getting builders who have stopped building and are instead buying up condos and single-family homes to fix them up and sell them. It’s a neat change I haven’t seen in four years.”

All-cash purchases also reflect a growing number of investors buying higher-end properties without credit, says NAR spokesman Walter Molony. That’s a sign that some investors see real estate prices as having nowhere to go but up. All-cash offers give buyers a competitive edge on rival offers – even higher ones – that are dependent on financing. Cash deals can close faster and are less likely to fall through.

“You have to have cash to be able to close quickly and have negotiating power. Cash is king,” says Tanya Marchiol, president of Phoenix-based Team Investments, which buys about 70 properties a month with cash it raises from investors. “We do want to flip it or generate cash flow (through renting it out). Now is the time to buy for cash flow. We know the market is going to rebound.”

Some investors say the current real estate market is an ideal time to buy because homes are so low priced, they are bound to hold their value.

That’s the philosophy of Jim McClelland of Tinley Park, Ill.

He is buying about 120 to 150 entry-level homes in the Chicago area this year and owns a total of about 300 properties.

He says now is a good time to buy because properties going into foreclosure are no longer just one-bedroom, fixer-uppers but nicer, split-level brick homes with more bedrooms that will probably appreciate to a higher value.

That’s because so many prime-rate borrowers who bought more expensive homes have gone into foreclosure.

He puts about $60,000 into upgrading a property, then rents it out.

“Do I think this year will be a better time to invest than in 2009? Yes,” McClelland says. “There have always been foreclosures. The difference now is you get a better home for the same kind of money. You’re sitting on better inventory. People get into real estate for financial independence. It’s not a quick fix. It appreciates. It doesn’t happen overnight.”

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Bill Cowie  Director
www.BritishHomesGroup.com
Orlando, Florida