Houses in the USA are Undervalued According to The Economist Magazine

by Las Sendas Homes on February 10, 2012

Well known magazine, The Economist has said that homes in the USA are currently being sold on average 22% below the price-to-rent ratio.

figures based on comprehensive housing data between 1975 and 2011 indicate the fact that there is a lot of room for future capital appreciation for investors who buy while the market is slow.

Since the USA’s property crash in 2006, a lot of investors have been looking to purchase US property foreclosures and various buy-to-let properties in the USA due to the low-entry nature of the market with many investors interested in US property foreclosures at a low prices.

With mortgages unobtainable for many people due to large required deposits and the rising amount of foreclosed properties, the rental market is experiencing a boom right now in many states where prospects and employemnt are picking up like Michigan for example.

Writing with caution, the magazine also said that house prices may take a further stumble over the next year and a half.
If the house prices to drop for a short time before bouncing back then some investors would say that this dip time would be the prefect time for those looking for a long-term investment to acquire houses when they are at the lowest prices.

Since the market peak of 2007, the value of properties in the USA has dropped on average by 34%.

But we do have positive news for the USA property market, according to the Detroit Free Press, both house sales and median prices of Detroit property saw an increase in September due to increased sales activity during the summer.

The Detroit Free Press Newspaper also reported an 8.2% increase in sales from 4,222 to 4,568 in September, with median prices rising by 10% from $68,000 to $74,900 across Metro Detroit. In Wayne County alone, property sales rose by 1.6% from 1,776 to 1,804 in September. Median property sale prices also experienced a rise with an increase of 8.8% from $40,000 to $43,500.

For investors looking to enter buy-to-let property investments in Detroit it is a good time right now to start seeking the right house and with a range of US property foreclosures available at auction a lot of investors are securing good bargains.

However most of these foreclosures homes will require refurbishment. Some property investment companies have taken the hassle out of Detroit property investments and offer complete investment packages, supplying homes in good neighborhoods that have been refurbished and are already let to long-term tenants meaning instant income for investors.

If you are interested in taking advantage of the current below market value prices of properties in the US and specifically US property foreclosures, and property for sale in Michigan then contact Experience International on +44 (0) 207 321 5858 or email

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