Well just back from another informative tour of the US with a fantastic group of investors from the USA, NZ and AUS and wanted to share some important tips for investing.
Blogger: Jason Simpson, Cash Flow Gold
Investing in the US market could be like buying a lotto ticket and hoping for the best if you don’t know what you are doing; investors get caught up on the low pricing and see the perceived value compared to our own homes here in OZ.
Walking through 50 or so homes recently in Atlanta, Georgia I can tell you that you can get into trouble fast! I saw some amazing properties in bad locations and some bad homes in excellent locations, Our recent tour investors that were with us learned so much which was squarely focused on education and support, explaining the good and bad and most importantly why.
For a start the US property market isn’t anything like what we know here, from construction right down to the attention to detail everything is different!
If you want a an investment property like you have here in Australia I suggest you stay and buy here, however if you put in the time and effort and want a strong cash flow of around 14% Nett and are prepared to accept the US as it is, then there is a gold mine of passive income to be discovered.
With the recent election now over in the US I would expect to see another flood of foreclosures starting to come back onto the market over the next 3-6 months providing an excellent cash flow and assisting in neighbourhood stabilization which is a win for all.
The market has been turning slowly and bottomed out about 12 months ago now, however with property around 33% of replacement cost, cash flow and possible capital growth it is still the best market in the world to buy in right now.
You can still buy quality homes in excellent locations and with a little renovation we are seeing they are being insured for replacement value 3 X higher capital input.
Education should drive every investment decision and not emotional connection or thinking at that price it has to be great, just don’t do it! I suggest looking into Zillow, Trulia and City-Data with the full address of any possible property you are considering and ensure-
1. You are buying from a bank only!
2. You can see past sales pricing / trends
3. Schools / transport
4. Taxes (Rates)
5. Other relevant information etc.
6. US City Data is all about the postcode, be sure it is correct and there is more info than you can poke a stick at!
Have fun don’t be afraid to fly over there and never buy under any pressure at all ever! There is so much potential and value in this market, just ensure that you are the recipient of the potential and value and not the person buying a 3rd party property.
About Jason Simpson
I started my back journey back in 2007 when I became very clear for me that there had to be more to life than going around in circles not getting anywhere. Regardless of what I earned form the 9 to 5 I always seem to spend it just as fast as it came in! I started reading a few books to get the knowledge I needed to break this cycle and purchased my first two homes in the USA for cash flow.
It was a disaster I quickly learned the term flipping and how rife it was through Australian resellers, I guess I was lucky I only lost 60k (donated the homes to charity) but more importantly after that experience and a lot more investigating I saw that there was a spot in the US property market to assist investors the right way and help them avoid the scams and flipped properties by buying direct from the Banks.
I stared Cash Flow Gold which has taken me into full time employment assisting investors from around the world to gain the maximum from their purchase. I now directly employ 6 staff here in Australia primarily in customer support and indirectly 40 personal across seven states in America.