Despite the global financial turmoil of the last two years, some centres in the United States present property investors with extraordinary opportunities.

Look to America’s heartland for a high yielding property investment

With Sterling’s value increasing to a five month high against the US Dollar and the numbers seeking rental accommodation rising due to continuing foreclosures, it would seem that the window of opportunity to invest in the US remains very much open.

Savvy investors are now looking for the next buy-to-let hotspot and it is to Heartland America that attention is turning. The mid-western states of Missouri and Ohio, home to the growing cities of St Louis, Kansas City, Toledo and Columbus, present a highly appealing investment environment with sustained demand for rental accommodation generated by the large employment base and detached family homes available at up to half below replacement build costs.


A home on Somerset Street, Toledo

Steven Worboys, MD of US property investment experts, Experience International, comments: “There is huge demand for rental accommodation from working families in the mid-western cities such as St Louis and Toledo. Up to 50% of residents in St Louis rent their homes with the majority seeking detached family homes. Property prices in these cities are well below the national median of $182,600 (Zillow.com) and owners can expect rental incomes of up to 12.5% in addition to capital gain.”

Combined, these cities hold a population in excess of six million and have weathered the economic storm better than many other higher profile cities. According to the U.S. Department of Labor, Kansas City has held a lower unemployment rate than the national rate with the healthcare and service industries replacing most jobs lost in the manufacturing sector and Columbus has been ranked the nation’s sixth most stable market by Standard & Poor’s as well as one of the 10 safest real estate markets in the US by the PMI Institute.

Data from the National Association of Realtors (NAR) revealed that property prices in St Louis for Q1 2010 were higher than the previous 12 months with appreciation at 15.1%, Toledo showed 13.3% appreciation, Columbus 6.3% and Kansas City 3.2% over the same period.

Worboys continues: “Many believe that the entire US was affected to the same extent by the recession but this is simply not the case. Indeed some states saw significant unemployment and as a consequence thousands of foreclosed properties but many states such as those in the Heartland due to diverse employment sectors avoided worst case scenarios and now as the economy shows continued albeit slow growth these cities are the first to recover.”

It is this recovery that shrewd international investors are keen to capitalise on. With three bedroom detached family homes available from as little as $24,500 (with 50% LTV finance) entry into the Toledo property market for example requires low cash outlay. Fully refurbished properties in sought after areas can expect to generate up to $860 per month and are sold with tenants already in place on long-term leases. One year’s home maintenance is also included and investors can take advantage of exclusive finance packages available.

To find out more about investing in property in Heartland America then contact Experience International on + 44 (0) 207 321 5858 or visit www.experience-international.co.uk.

UK investors offered opportunity to help USA underprivileged and make a profit

UK based property investment firm Assetz plc is offering British investors a chance to buy four and five-bedroom homes in America’s motor city of Detroit to rent to low income families and with a guaranteed return of more than 20%.

The USA government backed scheme ensures investor’s properties are protected as tenants are bound to look after them as if they were their own or face ejection from the scheme forever. The entry level is $50,000 for a four or five bedroom executive detached house (around £32,500), a quarter of what these properties were valued at around $200,000 four years ago, offering gross yields of 23%.

Michigan Four bedroom, two bathroom house over 1,700 sq ft in Detroit, Michigan. Priced at approximately £30,650. Contact Assetz USA

Properties are backed by the US department of Housing and Urban Development (HUD), helping to increase investor confidence and maintain a strong demand for these properties – there are already over 9,000 people waiting to be housed in the metropolitan area of Detroit.

Martin Sadler, Sales Manager of Assetz International, comments:
“This scheme represents a superb return on investment for a minimal cash outlay. You won’t find such an attractive investment opportunity anywhere in Europe at the moment. The scheme has clear, indispensable benefits to families and the community at large, providing quality, affordable accommodation to the 9,000-plus people currently waiting for housing in Detroit. It is even environmentally conscious, putting empty, foreclosed property back into use.

“We undertake the refurbishment of the properties, and our partners in Detroit manage them very closely. This involves a government inspection every year to ensure the property is being looked after. In addition our management company inspects each property every quarter. The strict regulations for occupancy safeguard against any unruly tenant behaviour, offering purchasers a well-maintained investment vehicle.”

  • Why Detroit? Largest city in the state of Michigan
  • Population of 5.4m
  • 240,000 businesses located in this region
  • Huge demand – over 9,000 tenants waiting for a home
  • Expected capital growth on property of 21.5% over next 12 months
  • Ethical investment – helping underprivileged families to live in a safe and stable community

Key facts

  • 4-5 bedroom detached homes from $50,000 (around £32,500)
  • Gross rent per annum $11,400
  • Gross yields over 23.6%
  • Following refurbishment value of property increases by at least 100%
  • Hands-off investments – fully managed with inspections and reports
  • Exit strategies in place – either by sale to tenant or sale onto open market when recovery takes off
  • After 12 months refinance available or via equity withdrawal

For further information contact Assetz USA on 0845 430 0010 or email usa@assetz.co.uk