US Property Investment: Strike while the iron is hot

Let’s be honest: the stakes are too high for any real estate investor looking to enter the Australian property market. With the prices nowhere near affordable, you’re better off investing your money elsewhere.

Like in the U.S.

U.S. property investment has been the cheaper option for real estate investors for a long time, given the price bubble in Australia that we’ve all been experiencing in the past few decades.

But that’s not all. What makes the U.S. market better than others is the size of opportunity and how the market is booming despite the 2020 recession.

Last year, the US housing market’s combined value hit $43.4 trillion AUD, which is almost as much as the combined GDP of the two largest global economies: the US and China. And, unaffected by the current economic conditions caused by the global pandemic, the U.S. residential property market is seeing some of the fastest price appreciation in recent years.

These will lead to significant returns on investment for any property seller. 

Not convinced yet? We have the numbers from some US property investors after working with Star Dynamic:

  • Since expanding their renovation business into the US market, Anne and Catherine have gained an overall return of 39% in just three months.
  • After Bernadette received an ROI of more than 17% on her investment in the US, she purchased two more properties and an apartment block, making her total income per year over US $55,600.
  • Paul and his wife Anne secured a townhouse in Florida, which earned them a yearly return of 12.5%. The couple are now looking to own five US properties in the next three years.

There’s a lot of opportunities waiting for anyone who wants to get into real estate in the U.S. However, no one really knows when the tide will change. That’s why it’s important to make your move now.

So, are you ready to strike while the iron is hot?

How to ready yourself to invest in the US residential property market

Knowing that the current booming market might not last very long, you need to be fully prepared as soon as you can be.

Here are four tips to ensure that you’re ready to take the leap to grow your wealth and invest in U.S. property:

1. Address what’s holding you back

Despite the overwhelming evidence suggesting how U.S. property investment can be a one-way ticket to building your wealth, many aspiring investors still think twice and end up shelving their real estate plans indefinitely.

That’s a big opportunity wasted.

If you’re in the same boat, you need to address what’s holding you back from making that big decision. The first step towards that is to develop the right mindset.

Mindset is a collection of beliefs affecting how you shape your thoughts, attitude, and habits. There are two types of mindsets: the fixed mindset and the growth mindset.

A person with a fixed mindset believes that qualities like intelligence, talent, and skill are unchangeable. So for instance, if you’re bad at maths and you have a fixed mindset, you’ll convince yourself that there’s no way for you to get better.

On the other hand, someone with a growth mindset believes that these qualities can be developed and improved through perseverance, training, and commitment.

Having a growth mindset will help you think more positively and push you to make a move towards progress in reaching your goals.

To improve your mindset, here are five helpful tips, which we explained in detail in a previous blog

  1. Train yourself to be better.
  2. Set goals and be accountable to them.
  3. Learn from your mistakes.
  4. Have a positive support network.
  5. Take action. 

Following these steps will give you more confidence in making big decisions (like investing in U.S. property) that will propel you towards success.

2. Success is a process: Learn what’s required and take action

Success doesn’t just happen, and it certainly can’t be achieved overnight. It’s a continuous process of learning, improving, and refining, which takes a lot of time and effort.

Succeeding in U.S. property investment is no exception. If you really want to succeed in your investment in the long term, it’s important that you set and follow a strategy that works and learn about the mistakes you should avoid making.

There’s so much to learn, so don’t expect that you’ll master it overnight – it doesn’t work that way. In fact, some of the most successful people in our world faced their own doses of failure before they achieved greatness.

Stephen King’s popular book “Carrie” was rejected by 30 publishers before it finally got published.

Oprah, who genuinely went from rags to riches, was told that she was “unfit for television” in one of her first jobs.

And Colonel Sanders, founder of the world-famous food empire KFC, was rejected over a thousand times before his recipe became a success. He was in his 60s by then.

We’re not implying that your investment has to fail hundreds or even thousands of times before you can succeed. You just need to learn to be patient, to trust the process, and to keep learning more about the process behind investing in US property in order for you to ensure that you’re on the right track to success.

3. Have confidence in yourself and have faith in the opportunity

When people tell you that “confidence is key”, believe them, because it’s the truth.

Having confidence that an opportunity will lead you closer to your goals allows you to firmly decide on pursuing it, and having confidence in yourself helps you gain courage to actually take action.

You can grow your faith in the opportunities by learning more about the advantages of investing in the US as opposed to investing in Australia. Things like how:

  1. The U.S. property market is booming despite the economic downturn. Prices for houses across the US demonstrated the fifth-largest gain in nearly 25 years, and is the strongest in 15 years.
  2. U.S. interest rates are currently at a record low – almost near zero.
  3. The value of the U.S. dollar has plunged in 2020, and according to forecasts, there will be a bigger decline in the coming year.
  4. Stimulus packages in both the U.S. and Australia will give you and potential buyers of your future US property a headstart in funding.

Building confidence in yourself is a different thing you’ll have to work on. Believing in the opportunity doesn’t automatically mean that you already believe in yourself. So you need to make sure that you have the confidence to make a move and face any obstacles that come your way.

Here are some strategies in improving self-confidence from Tony Robbins:

  1. Know your values. 
  2. Accept your emotions.
  3. Practice positive thinking.
  4. Change your physiology.
  5. Practice your communication skills.
  6. Reevaluate your blueprint.

Having faith and confidence in both yourself and the opportunity before you will take you a long way.

4. Get help from people who know better

We’re all social beings. Humans never evolved to be “lone wolves”, and that means there’s nothing wrong with getting help.

In fact, we all need help. From the moment we were born and helped by our parents to now being adults who have friends, teams, and networks – help from others is an essential part of life, and of success.

So when it comes to investing in U.S. property, it’s also important that you find the right team to help you take the right steps and make the right decisions.

Star Dynamic wants to help you achieve your financial goals by giving the most effective advice (STARR approach), having our team handle the complicated and tedious processes for you, and supporting you in your investment journey from start to finish.

Through our STARR approach, we can help you create the best investment strategy, build an amazing on-ground team, help you with property acquisition and renovation, and realise impressive ROIs. 

The way that the U.S. property market is booming now is just too hard to ignore. If you’re looking to invest in property, you’ll be missing a massive opportunity if you don’t take the leap and invest in the U.S.

Making that decision and taking action can be daunting, but it doesn’t have to be. You simply need to prepare yourself by developing the right mindset, learning about what to do (and what not to do) of U.S. property investment, believing in yourself and the opportunities in front of you, and getting help from the right people.

Then, the rest will follow.

To find out how U.S. property can secure your financial future, watch our masterclass video.

 

Linz’s Musings – Cash chests and where are they being Invested?

I was doing some ‘market research’ the other day, and came across an amazing article in the U.S from the Economist which was talking about the amazing chests of cash that many households particularly in the U.S are sitting on!

I’ll admit I had to do a bit of a double take, as most of the media across the board, in AU, U.S and NZ is pretty much all ‘doom & gloom’ when in reality, most of us savvy investors know this is not the case.

Firstly though, it was good to see an article finally saying this are not as bad as they seem.  I have been saying for some time, with such low interest rates, virtually worldwide, and billions (or trillions, depending on the market) of dollars being pumped into markets, thing are certainly pumping.

But one area I did not consider, is that will all the lockdowns, fear the negative press over the past 12 months, households’ options, and/or their want, to spend money has been greatly reduced!

Looking at the U.S specifically now, not only are most households up on income due to stimulus checks/packages etc, but they have had little options to spend this money…

Hence… Boom!  Cash chest

And check out this little graph below from JP Morgan Chase Bank, it’s the poorer households who are better off…

Who would have thought…?

So, I started looking into what people are investing in, with investing being the new black this year… (everywhere you turn now, it’s all about where are you INVESTING that cash of yours…)

Watching the Millennials, and while many give them a lot of crap, I have found they are one of the hungriest and switched-on generation regarding wealth, property is not their go-to.

With such high entry points, its not something most 20-year-olds are looking into.

(Although there are many ways to get into the markets & I do have a STACK of low entry, high cashflow investment strategies in the U.S, so hit me up kids!)

The search engines are being overloaded with trading, cypto and share searches, people wanting to know how to do this.

And the Millennials are the most ‘tech-savvy’ of the generations too so trading platforms and crypto/blockchain etc does not scare them.

But, if you no longer 20-something, and don’t know Blockchain from Blockbuster, then where are you looking?

Property

And if you are in the poorer median household income, and suddenly have cash, what do you do…

Buy yourself a house!

And suddenly… Boom!  We have a housing market going crazy…

So right now, for me, the owner occupier flips, are where it is at!

How are you finding this booming market affecting your strategies?

Linz’s Musings – Is Fear holding you back?

Happy Friday, welcome to Autumn and hasn’t summer gone out with a whimper here in Melbourne.  March 5 and already we are getting tops of only 15-18c.  Crazy!

Having said that, we have been busier than a one-armed bricklayer in Beirut… Market sentiment has certainly turned this year and many are looking to the U.S market to invest, is great to see…

I was thinking though, why so many people love the idea of the opportunities and the returns that can be made, but never actually make the decision to start?

I was watching a video on Facebook the other day, from Fearless Motivation (check these guys out on YouTube, certainly worth watching a lot of their videos!) and they were talking about why most people are not successful and it really hit home for me.

One of the main reasons we don’t succeed in anything is FEAR

But often, it can ACTUALLY be the fear of SUCCESS that holds us back…

The fear that we will not fit in.

The fear that we will lose friends or family along the way.

So many are afraid of success, that they deliberately CHOOSE to stay mediocre.

Is it really the fact that you may be afraid of succeeding that is holding you back?  Fear of who you will become by being successful?

The truth is though, you do not need to ‘lose yourself’ to become a success, moreover you actually grow INTO yourself.

Actually BECOME the person you are meant to be.

I can attest that sometimes the life of an entrepreneur can be a lonely one, so few understand the struggles that you go through…

But it is also one of the most satisfying journeys I have ever undertaken, to know that you can become all that you were meant to be – not limited by others’ thoughts and ideas on what or who you SHOULD be.

What is it that you are REALLY afraid of?

You got this!

Linz’s Musings – The Cash Crash and Growth wave coming…

G’day all

Almost the end of February already and 2021 does not seem to be slowing down at all!  With some minor spikes and hotspots of Corona, still raising its ugly head, just to remind us it is still there, but all in all, here in Australia and New Zealand, we have done very well in suppressing the virus

Other countries certainly have not been as lucky, but I guess when you actually do have a ‘MOAT’ and can raise the drawbridge as such, it certainly makes it easier.

In the meantime, market sentiment is already starting to go through the roof!  I have been saying for some time now that we are on the verge of a MASSIVE wave of growth in assets, particularly real estate, and we are already seeing this happen.

NZ is around 3 months ahead of AU, and even the U.S is now starting to rise quickly.

To say that we have been busy in an understatement…

One of the reasons for the massive boost in investments, particularly property is what is called the “Cash Crash”.

In essence, what we are seeing right now, with many government administrations pouring Billions, if not Trillions of dollars into their economies right now (whether or not this is needed is a debate for another blog…) is this will reduce the value of the ‘dollar’ so to speak.

So, investors try and ensure that they do not lose wealth, are looking to put their cash, into assets that do not depreciate in value.

We are already seeing this in the value of commodities, stocks, shares, even crypto and, yes, definitely Real Estate.

By investing in these assets, investors hope to preserve the value of their investment, and ride the wave of growth, or at least preserve the value they have.

Even here in Australia, I wrote about this a couple of weeks ago, the RBA surprised the market by doubling the amount of money it intended to print and pour into our economy by another $100 bn…

I could only see this was in an attempt to lower the AUD rate, but here we are, almost 2 weeks later, and bang, AUD has almost hit 0.80c US

Does this mean they will pump even more into our, already simmering economy?  Who knows, but what I can say is hold onto your hats…because this is going to get crazy!

You got this!

Happy Investing all and have a great weekend!!

 

 

 

 

F*** 2020, Here’s How to Get 2021 Back on Track…

You probably had big plans to make 2020 your best year yet. You had the drive to chase new goals and reach greater heights in your personal life and career.

But as we all know, the year took a bizarre and unexpected turn towards the worst within a few months of us all yelling “happy new year”. 

In what was one of the longest and most frustrating years yet, 2020 put many dreams on hold. And though we’ve made it through to a new year, everyone is still trying to find their way back into some sense of normality.

COVID struck hard leaving many people and societies at a standstill while watching their economies crash and unemployment numbers spike to the highest level in many years. 

To make the situation even worse, people were fed (and believed) divisive conspiracy theories that only fuelled society’s anxiety.  


But as Winston Churchill famously had said, “A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty.” 

With that mindset, there are good reasons to be optimistic in 2021.

While we can’t undo the changes forced upon, we can look to the future with hope and make 2021 the most prosperous year yet.  

 

What’s your 2021 New Year’s Resolution?

How often have you proclaimed, “New year, new me” as the clock strikes midnight on the last day of the year? Likewise, how long did it take to break your resolution or fall back into bad habits? 

It’s no wonder these resolutions fail, saying ‘I’ll get fit” or “I’ll give up drinking alcohol” sounds great but it’s not really practical if it doesn’t have a plan of action.  

But if anything is to be learned out of 2020, it’s that there’s one resolution that should be introduced and kept – securing your financial future.   

At a time when the world’s economy is down, and the bounce back is expected to take years, it’s the perfect moment to shift your focus to pursuing financial stability. 

And one massive opportunity to achieve it is by investing in the $33 trillion dollars US residential property market

COVID left the housing inventory all over the world in short supply, and this caused prices to rise. But it had seemingly almost no effect on demand. Many homebuyers were set on moving out of the city and into the suburbs. While others were scaling back and seeking to buy cost-efficient homes. And this made the competition tougher than ever, because people needed to act fast. 

Experts say that this will continue in 2021. Investment analysts foresee that the US residential property market demand will only continue to rise because of several factors like lower mortgage interest and a trend among many to relocate away from the city to suburban areas

For example, home values in Detroit increased by more than 92% over the last five years. And in the next 12 months, they’re projected to grow by another 12.2%. Demand continues to rise, because people are now evaluating the places they’ve been living in and assessing it against the future they actually want. 

 

Why your New Year’s Resolution should be investing in the US residential property market 

If you want to safeguard your future financially, consider investing in the US residential property market. After all, it’s never too late to add another resolution to your list for 2021. 

Here are several reasons why: 

1. Low interest rates

Banks worldwide are maintaining low interest rates as a way to help the economy recover post-COVID. The US Federal Reserve stressed interest rates near zero will continue until at least 2023

When interest rates are low, spending is encouraged. Borrowing becomes cheaper, thus making large purchases on credit — such as the purchase of a home — more affordable

The average rate for a 30-year fixed mortgage dropped from 3.62% in January 2020 to 2.68% in December 2020. There has been a consistent 0.7%-0.8% drop each month, and it’s expected to continue in 2021.

Now that mortgage interest rates are set to stay low for the next few years, property investors have more time to prepare for their purchase.

They can carefully weigh up their options and wait for more homes to go on sale. Given that the housing market is competitive and demand is high, it will only be a matter of time. 

Until then, buyers can work on securing their mortgage requirements and pre-approval applications. So, when they finally find a property they want, they can get ahead of their competitors. 

2. Introduction of stimulus package

In March 2020, the U.S. government signed the CARES Act, a $2 trillion USD COVID-relief act given in the form of stimulus checks. Individuals and businesses eligible for tax rebates received these checks.

The stimulus act was designed to help in two ways: 

  • The money provides financial assistance to low-income persons and families to help keep up with their bills.
  • It was given knowing people would spend it immediately, in turn avoiding any stagnancy in the economy.

The initial package included $1,200 USD per adult and $500 USD per child for households whose income was less than $99,000 for single taxpayers and $198,000 for couples.

Moreover, a new bill known as the Consolidated Appropriations Act of 2021, or CARES Act 2, was passed on December 21, 2020. This paved the way for another $600 USD given to qualified individuals and their dependents. 

While this doesn’t directly affect the real estate market, it does have some influence on it. Because a significant percentage of taxes has been waived, people have money to spend. Those who are wise enough are putting that money into purchasing properties. For foreign investors, this shows why now is the right time to capitalise on the U.S housing market, as higher spending will allow it to recover faster, and property value will then increase. 

3. A new wave of growth is emerging 

The global real estate market is headed for immense growth in 2021. 

Australia’s excellent response to COVID-19 has brought back the momentum for the housing market. In 2020, Sydney saw the biggest increase in house prices (12%), followed by Melbourne (10.8), and Hobart (7%). First-time home buyers are coming back, and it’s also attracting foreign investment. 

New Zealand also has a new wave of growth emerging. Rising housing prices in the country are a result of demand outweighing supply and relatively low interest rates which is forecast to sustain until the end of the year. Average prices for a house in New Zealand is now $788,967, an increase of 2.6% in just a few months despite a 6.1% growth in 2020’s final quarter.  

But while the market is hot in Australia and New Zealand, costs are still incredibly high with limited options. The turnover also takes longer, which incurs higher expenses for foreign buyers. 

In the US, home sales increased by 10.5% in August 2020 from the previous year. First-time homebuyers accounted for 33% of total sales. 

During this period, 69% of homes were on the market for less than a month. Properties typically stay on the market for more than a month, but in 2020, the average turnover was only 22 days.

This faster turnover rate means owners are selling quickly and there are numerous buyers available. Anyone who is ready to buy can enjoy their new investment home sooner.

 

Fortune favours the brave: it’s an opportunity to take now

All this indicates that investing in property is a great strategy to achieve financial stability. But succeeding in this endeavour requires learning and, like a New Year’s Resolution, the focus to see it through. That’s what  Star Dynamic client, Katie Potter did. 

When she decided to invest, she didn’t reap the benefits overnight. Instead, she broke her property investment dream into actionable steps and remained committed until she achieved her ultimate goal – two investment properties within nine months.

Like Katie, you have the opportunity to safeguard your future and enjoy passive income. We’ve created a free e-book to help get started on everything you need to know about investing in the US residential property market. 

If you’re interested to know more and want to speak with us, contact us today