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Investment & Lifestyle Properties For You
Market Overview
The exposure of the USA to the sub-prime mortgage markets has caused residential real estate prices to drop quite considerably from their 2006 peaks. Developers have recently started to adjust their sales-price expectations and now distressed apartments and homes are catching the eye of shrewd buyers.
Since the subprime crisis hit the US, prices across the board have fallen markedly, even in areas where rental demand has remained strong. Disney has actually seen an increase in visitor numbers as a result of both new attractions and the growth of emerging markets such as South America. Florida's popularity as a year round family holiday destination is evident as numbers have increased. Research shows that people will not forfeit their annual holiday in difficult economic times.
Investors are now seeing far higher yields than previously achievable as a result of price falls and whilst the collapse of the mortgage markets has caused economic growth to slow, the fundamentals of the market still exist in the medium term.
According to official US statistics new home construction starts are at a low record level of only 900,000 per annum. 18 million new homes are required to be built in the US over the next 10 years to satisfy the natural demand due to the population growth.
Once the current inventory declines and subsequently disappears supply and demand factors will impact thereby causing a natural rise in future sale prices. With population growth in Florida being amongst the highest in the country, the residential market will be in short supply in the coming years.
Coupled with a tourism industry which is continuing to post growth year on year, demand for quality accommodation should remain high for years to come. With the dollar strengthening rapidly against the euro and sterling, now is an excellent time to secure a dollar based asset.
