USA property -am I missing something?

MoneyJuggler

I do keep seeing this kind of investment, both on ebay and various google ads :-

http://www.ebay.co.uk/itm/4-Bedroom-property-USA-property-investment-/270833640016?pt=UK_HG_Property_RL&hash=item3f0ef16250

As an investment does anyone think this would actually work?

I can see that there may be longer term risks in terms of return/government policy changing-are those the main downsides?

I'm not an expert at all, and tbh I wouldn't feel comfortable investing in something like that, so this question is more out of curiosity than anything -has anyone done this, or got thoughts?

Thanks for any replies!

Ark_Welder

http://www.reuters.com/subjects/housing-market

MoneyJuggler

Ark_Welder wrote: »

http://www.reuters.com/subjects/housing-market

Great, thank you.

Regarding the risk they refer to, is the risk from default on loans they give, or further fall in capital value of property, or both/neither-apologies if that info is in the article and I've missed it - I'm not familiar with a lot of the terminology in that article.:o

atush

All of that, and costs such as property taxes, insurance, other running costs.can be $20K on a 3 bed home.

fwor

Hasn't Detroit got the largest proportion of derelict, valueless residential properties anywhere in the developed world? Whole districts where the value of the land is so low that they can't afford to demolish them?

I suspect you would end up with a property that looks cheap in UK terms, but which nobody in the US would ever think of paying, and in a location where nobody wants to live.

lynzpower

fwor wrote: »

Hasn't Detroit got the largest proportion of derelict, valueless residential properties anywhere in the developed world? Whole districts where the value of the land is so low that they can't afford to demolish them?

I suspect you would end up with a property that looks cheap in UK terms, but which nobody in the US would ever think of paying, and in a location where nobody wants to live.

100% dead on.

Massive Oversupply in a symbiotic relationship with no jobs.

martinthebandit

A net yeild of 16.1%? Why that sounds too good to be true.


And it sounds too good to be true because it isn't!

Onawingandaprayer

fwor wrote: »

Hasn't Detroit got the largest proportion of derelict, valueless residential properties anywhere in the developed world? Whole districts where the value of the land is so low that they can't afford to demolish them?

I seem to recall a very good line in the recent superb (imo) tv dramatisation of the last crash - Too Big to Fail - when someone said it would make more sense to spend all the proposed bail-out money on having most of the US's empty houses destroyed.

atush

Vegas is only 1% behind in that race.

competitionscafe

"In the first two decades of the 20th Century, an unprecedented development of massive industrial structures changed the face of Detroit and heralded a second industrial revolution.

Today all of those structures are in ruins, abandoned, decayed or destroyed."
http://www.detroityes.com/home.htm

Almost all the "double figure yield" US properties are in deprived areas:
http://usa.assetz.co.uk/property-listing.htm?sort_by=asc&attribType=0&prices_to=50000&search_prop.x=40&search_prop.y=18&search_prop=Search&prices_to=&sort=true

I remember when buying in Bulgaria was flavour of the month and look at how that turned out - or off plan properties in Cape Verde - or whatever else "a place in the Sun" was touting at the time.

Cook_County

I remain apalled that anyone is legally permitted to use the word "investment" in any advertising that is not FSA regulated. This is utter junk and typical of many similar schemes.