USA New Build property stimulates property growth for investors.
Since 2012 the amount of new homes being built in the USA is on the rise. This has a significant impact on investors, traditional home buyers and renters alike. The increase in new builds is a strong indicator that the property market is well on the way to recovery. After many years of slump there is good reason to believe that things are taking a turn for the better.
The favourable market conditions over the last couple of years have resulted in new builds being snapped up at record prices. Many of these homes are being bought by investors as opposed to the more traditional family units of years gone by. There are a number of reasons for this but one of the main ones is that due to the prolonged economic slump since the late 2000s many traditional homeowners are no longer able to buy due to bad credit or lack of the amount of savings needed to take out a mortgage.
This has resulted in a massive boom in the rental market instead as many families are looking for ever more affordable ways to find their ideal home. While homeownership may no longer be the norm for many families, the increase in the rental market has meant that people are now able to afford good quality housing in decent neighbourhoods.
The other advantage of the boom in investors taking on properties both new and old is that it has prevented many neighbourhoods from falling into disrepair. In the past the large numbers of vacant homes and empty lots had a knock on effect of lowering property prices throughout the rest of the neighbourhood. Now that investors are taking on these properties and renting to families who would otherwise have nowhere to live, the quality of these areas has significantly improved for all who live there.
While there is still a debate over whether it is better to build new homes or to invest in older, vacant properties there is plenty of money to be made for those who are savvy enough to invest while the market is still in the early stages of recovery. Gone are the days of investors buying property at knockdown prices in the hope of a quick sale at a large profit. Instead the financial rewards are slower to accumulate but they present a far greater return than on previous investment strategies.
The advantage of investing in new build, however, means that investors can achieve a far higher rental return on their initial investment. These new homes can be practically custom designed and many make the most of the latest in energy efficient and environmentally friendly technology. For those families who have found that homeownership is not longer an option, having the opportunity to rent a modern, high tech house is an attractive proposition that is worth them paying a premium price for.
The growth in the current housing market might be slow but there is a significant shift from home ownership to investors buying up large numbers of properties across a wider geographical area and renting them to families who have been affected by the change in the market. The investment potential here is almost limitless as the numbers of people seeking bankruptcy advice is on the rise.