Investors are saving the USA property market
"Three cheers for investors!" is probably not something you´re likely to hear the Occupy Wall Street protesters shouting. Nevertheless, the economic situation in the US would be a lot worse without investors.
I find it ironic that people used to enjoy boasting about their property purchases to friends and families during the boom. A conversation starting with "You have a property in Florida?" "Good for you, but I just bought three in Bulgaria" would not have been out of place in an Irish pub in 2006. Nowadays, people keep very quiet about their property investment activity.
Discretion is good, but the irony is that property investors are much more useful to society now than they were 5 years ago. The properties they´re buying are also far more worthy of a pub discussion.
It is estimated that investors snapped up a whopping 30% of the total sales of USA property last year. When the property crisis was at its worst, it was investors (many from overseas) who pumped billions into the US economy. They bought when the market was at its lowest ebb when nobody else was interested. They used hard cash to purchase and fix up hundreds of thousands of properties and then rented them out to families.
Nobody else would have had the confidence to buy enough volumes of property to stop the slide in prices and reduce inventory back to pre boom levels in many cities. Investor activity has revived many local real estate markets and it has given potential owner occupiers (and their bank managers) much more confidence.
I´m not suggesting that property investors have purely charitable motives - they´re in this business to make money and they certainly know how to squeeze a seller. Nonetheless, the actions of the majority of them have had a very positive impact on the market. According to the National Association of Realtors, every home purchased pumps $60,000 into the economy for furniture, home improvements and related items.
Looking forward to your thoughts.
For full details on the real estate offered by Torcana Ltd please visit www.torcana.com