Market Scenario – USA

Overview:

The US contains a highly diverse population, the product of numerous and sustained waves of immigration. The U.S. economy grew by 2.3% in 2017, an acceleration from a 1.5% growth in 2016.

Facts

  • Population: 6 million (UN, 2010)
  • Capital: Washington DC
  • Largest city: New York City
  • Area: 8 million sq km (3.8 million sq miles)
  • Major language: English
  • Major religion: Christianity
  • Life expectancy:76 years (men), 81 years (women) (UN)
  • Monetary unit: 1 US dollar = 100 cents
  • Main exports: Computers and electrical machinery, vehicles, chemical products, food and live animals, military equipment and aircraft
  • GNI per capita: US $47,390 (World Bank, 2010)

 

RESIDENTIAL PROPERTY FACTS

Price (sq.m): $17,191

Rental Yield: 2.91%

Rent/month: $4,942

Income Tax: 30.00%

Roundtrip Cost: 9.82%

Cap Gains Tax: 5.00%

Landlord and Tenant Law: Pro-Tenant

 

Price History

After five years of strong house price growth, the U.S. housing market / home for sale in USA, remains surprisingly vibrant. Demand remains robust, and residential construction activity continues to rise. Many real estate developers in USA are also offering their properties along with the EB5 citizenship programme making it more favourable to invest. The S&P/Case-Shiller seasonally-adjusted national home price index rose by 6.21% during the year to November 2017 (3.91% inflation-adjusted), its strongest y-o-y growth since June 2014. This was supported by Federal Housing Finance Agency’s seasonally-adjusted purchase-only U.S. house price index, which rose by 6.54% y-o-y in November 2017 (4.24% inflation-adjusted), a slight increase from y-o-y rises of 6.44% in November 2016 and 6% in November 2015.

All 20 major U.S. cities experienced relatively strong house price hikes, according to Standard and Poor’s, with Seattle posting the highest increase of 12.71% during the year to November 2017, followed by Las Vegas (10.6%), San Francisco (9.04%), San Diego (7.45%), Los Angeles (7.02%), Tampa (7.02%), and Dallas (7.02%). Strong house price rises were also registered in Detroit (6.98%), Denver (6.94%), Portland (6.94%), Boston (6.26%), Charlotte (5.76%), New York (5.71%), Phoenix (5.54%), Minneapolis (5.41%), Atlanta (5.14%), Cleveland (4.13%), and Miami (4.06%).

Washington and Chicago saw the lowest growth in inflation-adjusted house prices at 3.28% and 3.59%, respectively.

Major Urban Areas

New York-Newark 18.593 million; Los Angeles-Long Beach-Santa Ana 12.31 million; Chicago 8.745 million; Miami 5.817 million; Dallas-Fort Worth 5.703 million; WASHINGTON, D.C. (capital) 4.955 million (2015)

Investment Returns

Good yields on studios in New York

 

Last Updated: Jun 15, 2017
NEW YORK MANHATTAN – condos and co-ops COST (US$) YIELD (p.a.) PRICE/SQ.M. (US$)
TO BUY MONTHLY RENT TO BUY MONTHLY RENT
Studio 514,114 2,689 6.28% 10,151 59.31
1 br 933,811 3,436 4.15% 13,498 54.79
2 br 2,037,340 4,942 2.91% 17,191 56.30
3 br 4,192,730 8,497 2.43% 22,239 64.59
4+ br 9,866,070 n.a. n.a. 32,260 n.a.
Upper East Side co-ops and condos
Studio 458,035 n.a. n.a. 9,569 n.a.
1-BR 900,657 n.a. n.a. 12,670 n.a.
2-BR 1,913,897 n.a. n.a. 16,975 n.a.
3-BR 3,519,365 n.a. n.a. 19,150 n.a.
4+BR 7,024,033 n.a. n.a. 24,672 n.a.
Upper West Side co-ops and condos
Studio 500,306 n.a. n.a. 10,097 n.a.
1-BR 841,561 n.a. n.a. 11,787 n.a,
2-BR 1,837,605 n.a. n.a. 16,792 n.a.
3-BR 3,347,850 n.a. n.a. 20,000 n.a.
4+BR 7,455,682 n.a. n.a. 27,815 n.a.
Soho and Tribeca co-ops and condos
Studio 475,000 n.a. n.a. 9,171 n.a.
1-BR 1,475,199 n.a. n.a. 15,867 n.a.
2-BR 2,977,086 n.a. n.a. 18,741 n.a.
3-BR 6,513,413 n.a. n.a. 26,943 n.a.
4+BR 11,551,514 n.a. n.a. 34,166 n.a.
The Hamptons
Condos 969,453 n.a. n.a. n.a. n.a.
1-3 BR Family homes 1,766,557 n.a. n.a. n.a. n.a.
Luxury homes 6,691,021 n.a. n.a. n.a. n.a.
FLORIDA
Miami Beach luxury condos sq. m. 4,164,699 n.a. n.a. 14,295 n.a.
Palm Beach luxury homes sq. m. 12,675,000 n.a. n.a. 23,563 n.a.
Source: Miller Samuel Aggregate Data for Q1 2017 Definitions: Data FAQ See also: Update Schedule

 

  • a studio apartmentcan rent for around $2,700 per month, earning a rental yield of around 7%
  • a 1-bedroom apartment can rent for around $3,500 per month, earning a rental yield of around 4.4%
  • Larger unitsearn proportionately lower returns.  A 3-bedroom apartment is likely to earn a rental yield of around 2.4%

 

Key House Price Facts

 

KEY HOUSE PRICE FACTS
Square Metre Prices  $17,191
Rental Yields  2.91%
Rents  $4,942