Any good overseas markets?

[brian]

I haven't researched any particular overseas markets too closely yet, but to date I've been left with the impression that many are effectively in the same state as the UK property market - ie, property not selling well, but sellers stubborn on lowering prices.

However, have any regions started to come through this barrier and start offering property for prices pretty much at a discount on previous years?

Or is stubborn is what stubborn gets still going on?

[Jeannie D]

I've been watching the French property market for some years now and it's difficult to judge because it's always been slow. Even before 2007, it was quite common for houses in some areas of France to take two or three years to sell. I suspect this is partly to do with the traditional French view of houses as homes rather than as investments and partly because of the strict rules of inheritance that really only work smoothly when there is no disagreement or discord in the family.

What I have noticed, however, is that since 2008, there has been an increasing trend of ex-pats keen to return to the UK so the house starts off at one price, then reduces, then reduces still further. Then the internet photos are updated - and the furniture has gone. Then you see the inducement "price negotiable in sterling". So, on the whole, there are bargains to be had if you are in a position to buy.

Of course, there are also a lot of people in France sitting on their hands because they don't have to sell....exactly like here.

[Moby Jones]

Originally Posted by brian

However, have any regions started to come through this barrier and start offering property for prices pretty much at a discount on previous years?

Some regions of the US fall into this category. Other areas of the US are starting to show very slight price increases. Take a look on the investor forums and you'll get a good idea. It's quite easy to do your due dilligence on yank equivalents of righmove etc too if you're thinking of investing.

[New Homes Expert]

I hear Detroit is very cheap at the moment!

[Moby Jones]

I reckon certain parts of Florida would suit the OP. We're looking at condos there at the moment.

Detroit can earn you 15% + ROI if you buy in the right part and avoid the war zones.

[priceyprice51]

I'm currently considering buying a property abroad Brian. While it's primary purpose is as a holiday home and someday possibly a retirement pad, I'd like to buy in an area with a stable property market & economy. I've heard the Floridian market is stabalising now & Miami in particular is hotting up, can anyone second this?

[Moby Jones]

I'm looking at 2bed 1br homes in Kansas City MO. Cost price $£29,950 supplied with a section 8 tenant on 12 month contract paying $650 per month rent.

Insurance $30 per month
Taxes $35 per month
Management fee 10% of rent.

Selling UK BTL's now to increase US portfolio.

[Albufeira]

My advice is as follows, stay away from hot markets. When somewhere is booming you want to avoid it. It is always best to buy in an area where people say the market will never recover. For most of my career I sold stocks and I found that investors would buy "hot" stocks (usually when they were near their peak), and then they sell when stocks are crashing (usually at a loss).

It's almost always impossible to call a bottom to any market. However, with housing markets it's usually when a market is so bad that the media says it will only get worse and recovery seems non-existent. In 1998-2004 was the right time to buy in Brazil and at that time I saw properties were dirt cheap, I regret not having bought in 2001 when I saw the bargains I did. In Argentina just after their economic crisis many people were predicting that the country would never recover, but anyone who bought in 2003-2005 has made a great investment. The same could be said for Russia in the late 90s.

If a market is starring into the abyss, then it's probably a good time to buy. I would say that now is the time to look at the PIGS markets and try to find good deals. Even if your property does go down in value in the short-term, be a long term investor and you will be alright.

[brian]

Interesting comments all round, thanks for those. I think the general impression is that there is still some resistance to price falls, so you need to be either lucky, knowledgeable, or else find a desperate buyer to get a good deal.

I guess this means I'm going to have to keep a general eye out so that if I'm in a position to buy in the near to mid term, at least I can get some markets researched to some degree.

[Jeannie D]

The uncertainty in the eurozone may also be putting people off, even those with sterling incomes. I read a worrying article recently about a small village in Spain with a new, enthusiastic and very sensible mayor who was making an heroic effort to tackle the overwhelming government deficit faced by his small community but it did not make for cheerful reading. The council workers' salaries were only guaranteed until the end of August; a new half-built, unoccupied health centre was deteriorating for lack of funds; the local unemployment exceeded even Spain's unthinkable national average of 20%. Neighbouring villages were faced with similar problems. You could probably buy the whole village for a tenner, but without the infrastructure, who would want to?

This may be an extreme example but my French friends tell me that they have known for years that France has been living above its means and that its economy is being damaged by the euro. In fact, it's a moot point whether the French ever really reconciled themselves to the euro; immobiliers still advertise house prices in francs as well as euros and supermarket receipts still translate the total bill into francs.

Albufeir may well be right when he says that when a market is staring into the abyss, it is probably a good time to buy. However, for those of us who are not professional investors, it's a gamble. I would love to live in France but I think for the time being, I'll stay put!