One World Trade Center Open for Business and Manhattan Property is Booming
After the events of 9/11 in 2001 the world trade centre reopened this week in lower Manhattan on the site of the original twin towers. This marks a huge step in American history almost 14 years after that fateful day.
Manhattan itself has seen huge growth in its real estate sector boasting some of the highest yields on the planet last year and with those numbers widely expected to sustain in the years to come it seems the perfect time for international investors to start looking back at the US.
For many international investors, the US financing options have been a major barrier to entry with more red tape and checks to pass through in order to finance your property purchase but with the right help it can be made more easy. Many international agencies have identified that most real estate buyers do not enjoy the hassles purchasing overseas real estate comes with, for example financing, mortgage, property management, letting and resale. With every country comes different taxes and laws and its sometimes hard to keep up with whats expected from you. Over the last few years some of the worlds largest real estate agencies have started to introduce extra services to their investors to help ease this burden and offer expert advice to its investors as well as source their finance for them, and some even go as far as managing the property, finding a Tennant and reselling the property for the investor and thus making it far easier and simple to invest overseas. A Hong Kong based company called IP Global is one of these companies who are pioneering the way forward and making international investing easier for everyone. Others include KnightFrank and Savills to name but a few.
Many investors who stick to local markets only are limited to their own economic situation as to how much profit they can make which is what makes investing overseas so attractive. By following a few simple rules and the use of the internet it has never been easier to identify and purchase solid investments from anywhere in the world from the comfort of your armchair. These are the steps I personally follow when looking for places to put my money. To give you an idea of my strategy I do not like to gamble with my hard earned cash and would be happier earning 5% per annum yield guaranteed than 20% per annum with a riskier product;
- Stick to Core CBD locations as these tend to be the safest as the land is usually expensive it tends to be only the best companies which develop there. Also if there is a country-wide economic slowdown the CBD locations are always the least effected and the first to show growth.
- Research the developer. Find out who the top 10 developers are within your region of investment. Ask the developer to show what other projects they have done to date and ask for proof. In my experience its very easy for a developer to make claim to past projects in order to give themselves false credibility.
- Stay well clear of any project offering guaranteed returns. This has been one of the most common phrases used among companies that will inflate the investment prices in order to provide imaginary returns for set number of years. This is not actual returns but your own money back. This tends to crop up more with investments under the USD100,000 mark where the market is more unregulated.
- Make sure your property has undergone a valuation before purchase by a reputable valuation agency.
- Compare finance options with at least 3 other banks to ensure you are getting the best rate possible.
- Know your laws. Property laws change from country to country and if you don't have an agency to help you identify what they are then you could face lengthy delays on the exchange and/or fines which will eat into your profit.
- Know your local letting and management companies. Use google to find the top 5 in any given location and see how they differ. Some will offer a rental guarantee but sometimes comes at a high premium. if you purchasing in an area such as a CBD then you should have no problem renting it out so this may not be needed for some investors.
- Know your Exit. This highly depends on market condition and each investors liquidity. The decision to sell will mostly be on your shoulders so your cashflow will usually be the main driver in this decision.
With these simply tips and pairing with the right companies overseas investing is becoming easier each year and with the amount of information we now have at our fingertips online there is no excuse to not make more profit than ever.