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Cleveland News June 2023

‘Re-Imagine Euclid Ave.’ Study Focuses on Pedestrian Safety, Congestion on University Circle Corridor One of the most congested areas on Cleveland’s East Side could see a major road revamp in the next year, a recent study presented Tuesday foretold. “Re-Imagine Euclid Avenue,” a new transportation plan backed by NOACA and the RTA, suggests that the main artery linking Midtown to Uptown is in need of a restructuring, from dedicated bike lanes to an extension of RTA’s HealthLine further into East Cleveland. The Superior Avenue Midway, a centre lane bike corridor which will connect Public Square with East 55th, will be the city’s first modern cyclist corridor of its kind when its constructed—as planned—in 2025. And Shaker Heights’ $23 million Lee Road Action Plan, which was approved by council in March, will give the street its own road diet, adding a sidewalk-level, two-way cycle track, along with expanding sidewalks, seating and boosting lighting. University One, a recent high rise luxury apartment complex close to Euclid, along with the proposed Infinium on East 117th, Circle Square off Stokes Blvd., and a redesign of the nearby branch of the Cleveland Public Library, will only beckon for the fruits of the re-imagining: to enhance University Circle’s walkability. On and off its roadways. Cleveland City Council approves $10 million for waterfront projects Cleveland City Council just approved $10 million for four projects aiming to improve the city’s waterfront. The four projects — Irishtown Bend, expansion of an East Side fishing pier, Euclid Creek Greenway and the Northcoast Connector project — will receive funding through American Rescue Plan Act dollars. Legislation approving the four projects was approved without any no votes during a City Council meeting. The North Coast Connector project aims to connect downtown Cleveland to the lakefront by creating a land bridge from the downtown mall to the lakefront, improving access to the Rock and Roll Hall of Fame and Cleveland Browns Stadium. The $3 million approved would partially fund engineering of the project, which is estimated to cost between $8 million and $10 million, according to city documents. The city says its $3 million contribution is needed to leverage other investment in the project design. Council also approved $1.5 million for design work to improve and expand the East 55th fishing pier. When seeking public comment on how to improve the lakefront, one recurring theme was the need for an improved fishing area, Cleveland City Councilman Anthony Hairston said. The pier improvement is part of the CHEERS project. CHEERS, which stands for Cleveland Harbor Eastern Embayment Resilience Strategy, is a $300 million project designed to improve lakefront access east of the Burke Lakefront Airport. The project plans to do that by reusing dredge material from the Cuyahoga River to expand parks and improve the shoreline. Council approved spending $1.5 million in ARPA funds to design the project’s early implementation phase, which will include adding four to six acres of parkland, fixing a break wall and improving fishing areas, according to city documents. The Irishtown Bend project aims to stabilise a hillside in Ohio City and transform it into a 17-acre park. Cleveland City Council approved putting $5 million in ARPA funds toward the project, which has an estimated total cost of $95 million. The Euclid Creek Greenway would carve a two-mile trail from Euclid Creen Parkway to the lakefront. The multi-phase project is a “missing link” between the city’s East Side and the lakefront, said Joyce Pan Huang, Cleveland’s director of city planning. Council approved $500,000 toward the project which has a total cost of $800,000. The design and engineering phase is expected to go through 2024, as trail routes are not yet finalised If you would like more information or wish for a call regarding the latest properties Global Investments can offer in this location then please email us today at : invest@globalinvestmentsincorporated.

If I pay my fee and holding deposit am I committed to buy the house?

One of the most common questions by some of our investors are on the payments that are needed to reserve or book a property. To book and reserve a property and take the property off market are two payments, one payment of $3,900. This is our arrangement fee. And a $2,000 deposit which is sent to the title company in the relevant state. ( This is called an Ernest Money Deposit ) Even though these are not large payments clients see these as a commitments which they are. One of the questions that come up quite a lot is if the property inspection does not meet the clients expectations or there is something majorly wrong with the property then what happens with my downpayment and the fee paid to Global Investments. So let me cover this. Once a client pays the fee and the Ernest money to the Title company we sign a purchase contract. This purchase contract is subject to a full independent inspection. This is where we would check the main fundamental items in the property. Roof, foundation, electric, plumbing and also we check for any structural movement. If for whatever reason we don’t like something in the inspection we can simply cancel the sale and any funds paid are fully transferable to an alternative property of your choice. ( This its very rare as our suppliers give us excellent properties. ) Saying that normally like with any tenanted house the inspection can bring up minor maintenance items. Once we are happy that the house is in good standing and all the main items are fine we would ask the seller to take care of any maintenance items that are brought up by the inspection before we close. So even though you are making a financial commitment you are not committing to buy that specific house until we are 100% happy with the inspection. What you are committing to is buying a house in the US. We cover every aspect in the process and if there is something we do not like about the inspection then we would actually advise you to cancel the contract and we can start sourcing a more suitable property and like I said there is no cost to the client for this. These investments are long term 5-10 year projects so if it takes a few extra weeks to find the right house for you then this gives our clients the peace of mind that we have their best interests at heart. Mike Moodie – CEO Global Investments Inc

Housing supply has started to plunge in some US States.

We have wrote articles before about limited supply of properties in the US but now we can say supply is starting to plunge in some States. Mortgage rates are causing havoc in the US housing market, the 20 year high is splitting the market. According to realtor.com home inventory fell in 21 of the 51 cities. The divide seems to be between Northern and Southern States, property in the South tend to be more affordable where Buyers are more willing to enter the housing market which means there are more listings and more inventory available. In the North your will find larger Metropolitan areas, like New York, Chicago, Cleveland and Baltimore, the higher borrowing costs have stunted many prospective buyers causing local demand to fall. 85% of mortgage holders are locked in to sub-5% mortgage interest rates, which discourages current homeowners from selling their home and buying another at today’s elevated interest rates.The housing market has been the sector hardest hit by aggressive Federal Reserve interest rate hikes that are aimed at quelling high inflation by dampening demand in the economy. “Dampened affordability remains an issue for interested homebuyers and homeowners seem unwilling to lose their low rate and put their home on the market,” said Sam Khater, chief economist at Freddie Mac, in a press statement. “If this predicament continues to limit supply, it could open up an opportunity for builders to help address the country’s housing shortage.” Housing supply holding steady at near historic lows has propped up demand compared to other downturns, consequently sustaining higher home prices.“Inventory is approximately 46% below the historical average dating back to 1999,” says Jack Macdowell, chief investment officer and co-founder at Palisades Group. But going back to the South again the picture looks different, the Southeast market is incredibly active , which holds 18 of the 20 hottest housing markets, according to Bankrate’s Housing Heat Index. Research shows metro areas in Georgia, Tennessee, Florida and North Carolina are at the top of the list of the country’s strongest seller’s markets. Lawrence Yun, chief economist at the National Association of Realtors, sums up the Sun Belt boom this way: “It’s all about job growth and affordability.” In April 2023, Southeast home prices were up 2.5% compared to last year, selling for a median price of $405K. Miami was the most popular destination among Southeast homebuyers followed by Philadelphia and Boston. 71% of Southeast homebuyers searched to stay within the Southeast metropolitan area. The Wall Street ran article which sums up the situation very well, we are looking at A Tale of Two Housing Markets, one market stagnant with limited inventory while the other is booming with plenty of inventory, so is the South always sunnier ? It depends on your reasons for purchasing a property, if you are going to live in the property well then the South seems like the obvious answer, more inventory to choose from a selection of different areas. But if you are buying the property for an investment the North looks like the better option, limited inventory has pushed up rental demand which has pushed up monthly rental payments. The problem is getting the property in the first instance, in Cities like Cleveland and Detroit properties are being sold within a number of hours not just days. If you want to see our latest properties in Cleveland and Detroit, two of the best Northern cities please email [email protected]

Detroit housing market 2023

Investing in the Detroit housing market has been a source of contention for investors for a long time. When considering whether or not to add properties in the Motor City to your portfolio, keep these three current trends in mind. The city of Detroit is one of the most populous in the Midwest. It also serves as the county seat for Wayne County. When it comes to residential in Detroit, home prices are exceptionally low. Detroit is the most affordable city. The rentals can generate extremely high returns on investment. Since the purchase price of a Detroit single-family home is significantly less, it presents a fantastic opportunity with significant returns and cash flow. It is also the fastest-growing city in the metro for rent. The Detroit housing market has seen a lot of fluctuations in the past few years. The city has been slowly but steadily recovering from the Great Recession, which hit the area particularly hard. In this blog post, we will take a look at the current state of the Detroit housing market, based on the most recent data available. We will analyse key metrics such as home prices, days on the market, and buyer/seller competition to provide insights into what to expect in 2023. Median Sale Price Data by Redfin show that the median sale price for all home types in Detroit in January 2023 was $76K, up 1.1% compared to the previous year. This modest increase is a positive sign for the city’s housing market, indicating that demand for homes is stable. Overall, Detroit’s housing market seems to be recovering but it is still far from pre-recession levels. Buyer/Seller Competition The Redfin Compete Score rates how competitive an area is on a scale of 0 to 100, where 100 is the most competitive. Based on this metric, Detroit’s housing market is somewhat competitive, with a score of 63. This means that while homes in Detroit receive 3 offers on average, some homes still get multiple offers, making the market somewhat competitive. Detroit, MI Housing Market The following housing market trends are based on single-family, condo, and townhome properties listed for sale on Realtor.com. Land, multi-unit, and other property types are excluded. Detroit, Michigan has had its fair share of ups and downs, but when it comes to the housing market, things are definitely looking up. According to the latest report, the median listing home price in Detroit was $79.5K in February 2023, up 6% year-over-year. In addition, the median listing home price per square foot was $69. While the median home price may seem low compared to other major cities in the United States, it’s important to remember that Detroit is still in the midst of a renaissance. With companies like Amazon and Google setting up shop in the city, and a growing tech industry, it’s no surprise that housing prices are on the rise. Despite the increase in prices, Detroit has still considered a buyer’s market as the supply of homes is greater than the demand for homes. With 180 neighbourhoods in Detroit, there’s a wide range of options available for buyers. While Detroit may be a buyer’s market, that doesn’t mean that sellers won’t be able to sell their homes for a fair price. With housing prices on the rise, sellers may be able to get more for their home than they would have a few years ago. Location matters. As with any housing market, location matters in Detroit. Those looking for a high-end home in a prestigious neighbourhood should expect to pay more, while those looking for an affordable option may need to look in less expensive neighbourhood’s. The rental market is also on the rise. With the influx of new businesses and industries in Detroit, the rental market is also experiencing growth. This could be a great opportunity for investors looking to purchase rental properties. Overall, the Detroit housing market is showing promising signs of growth. Whether you’re a buyer, seller, or investor, there are opportunities to be found in this city. With the right research and guidance, anyone can navigate the Detroit housing market successfully. According to Neigborhoodscout, over the last decade, Detroit real estate has appreciated 89.70 percent, which equates to an average annual appreciation rate of 6.61 percent, placing Detroit in the top 30% of all cities for real estate appreciation. In the last twelve months, Detroit’s appreciation rates have remained among the highest in the country, at 20.95 percent. Short-term real estate investors have found success in Detroit over the last twelve months. Detroit’s appreciation rates were 0.87 percent in the most recent quarter, equating to a 3.53 percent annual appreciation rate. Detroit Real Estate Investment Overview Detroit, Michigan is a city with a rich history, known for its role in the automobile industry and its contributions to music, art, and culture. In recent years, Detroit’s real estate market has been on the upswing, making it an attractive destination for real estate investors looking for long-term returns. Investing in the Detroit rental market offers several advantages for long-term investors. One advantage is the potential for long-term appreciation in property values. As the city continues to grow and improve, property values are expected to increase, leading to a significant return on investment for those who invest in rental properties now. Another advantage of investing in the Detroit rental market is the relatively low cost of entry compared to other markets. With lower prices for rental properties, investors can purchase properties at a lower cost, increasing their potential return on investment. Additionally, the high demand for rental properties in Detroit offers the potential for a consistent stream of rental income. As more people move to the city and job opportunities continue to grow, the demand for rental properties is likely to increase, providing a steady source of income for investors. Buying or selling real estate, for a majority of investors, is one of the most important decisions they will make. Choosing a real estate professional continues to be a

Cleveland Property News May 2023

Chicago developer turns scrap into luxury living with its first Cleveland apartment building From scrap yard to deluxe living, a Chicago developer believes its first entry into the Cleveland apartment market will offer something unique. The TREO Apartments on the 2400 block of West 25th Street on the edge of the Tremont and Ohio City neighbourhoods is the first Cleveland endeavour for Chicago-based Mavrek Development. The land was the former home to a scrap yard owned by Sass Automotive and Wrecking until Mavrek paid $1.2 million for it in 2021. Construction was completed earlier this month and residents have begun to move in. TREO has 170 apartments on four residential floors with floor plans offering studios, one-bedroom apartments, two-bedrooms apartments, and two baths. There are also junior size one-bedroom units of up to 612 square feet, or 200 square feet less than the other one-bedroom units. Rent ranges from $1,223 to $2,160 a month. Some features include dedicated work areas, motion lights in every closet, in-unit washer and dryers and balconies for all but 10 of the units. Cleveland native Adam Friedberg of Mavrek said he believes the apartment building offers some new things to the Cleveland market. “We did some custom stuff at TREO that we hadn’t seen elsewhere in Cleveland. I think we’ve done a really good job at that and so far the feedback has been really, really positive,” Friedberg said. A rendering of the TREO Apartments ahead of completion of construction on April 1.Mavrek Development : One of the units in the TREO Apartments : Friedberg said that Latch, a full-building operating software and security system, will allow residents to use an app to access their apartments and other amenities. Latch also offers residents a package tracking system that gives them codes to pick up packages in a designated place. Other amenities include a large front courtyard, a sizeable gym, private Zoom-rooms for Zoom meetings on the main floor, a fifth-floor activity room that includes a table beer tap that residents can access with their phones, and a fifth-floor patio with unobstructed views of the downtown Cleveland skyline. There is 2,100 square feet of commercial space on the main floor, which Mavrek hopes will eventually be home to a local coffee shop or another business that would act as an amenity to the building. Space would also be open to the community. No.1 most expensive home sold in Cuyahoga County, April 17-24 was in Shaker Blvd, Hunting Valley. Hunting Valley is an eastern suburb of Cleveland, it is part of the Cleveland metropolitan area. The Village of Hunting Valley was incorporated as a village in 1924. The Village is comprised of eight square miles in the Chagrin River Valley, a suburb in the Greater Cleveland area. Known for its picturesque landscape and land conservation. The most expensive home sold in Cuyahoga County, April 17-24 was 3030 Shaker Blvd. The price was $1,600,000. The house was built in 1954 and has a living area of 4,667 square feet. The price per square foot is $343. The deal was finalised on April 6. Financing lined up for Ohio City high-rise apartment, hotel building Bridgeworks, a mixed-use high-rise planned in Cleveland’s Ohio City neighbourhood, has received approval on bond financing from the Port of Cleveland. Two bond financing resolutions were passed by the Port of Cleveland to aid Mass Design Group, M. Panzica Development, and GramMar in constructing the 15-story building. One resolution authorises the issuance and sale of $80 million in taxable Lease Revenue Bonds. The other resolution authorises the issuance and sale of about $4.1 million taxable Bond Fund TIF Bonds through the Port’s bond fund. Bridgeworks Project Rendering : If you would like more information or wish for a call regarding the latest properties Global Investments can offer in this location then please email us today at : invest@globalinvestmentsincorporated.

When is the right time to buy real estate?

At Global Investments we’ve been involved in the property market for many years. While some things change and move with the times, we still hear the same age old questions on a regular basis: “When should I buy? What is the right time to buy? When do I know that market conditions are right?” Understandably, investors around the world are often focused on purchasing properties that are competitively priced and with great potential for yielding returns. While I think that these are of course great questions, the truth is that they aren’t all that easy to answer. And that’s because real estate is rarely black and white. There aren’t times when it’s a clear buyer’s market vs times when it’s not. There are many factors at play in this type of investment decision. It can depend on what type of property and what price point you are looking at, for instance. It also depends on your own situation as an investor. In broad terms, we can say that when the economy is bad and markets are down, things become trickier for those investors who are reliant on finance. For instance, we know that interest rates and inflation are currently high, accompanied by a cost of living crisis. Yet for investors who have cash at hand, this is a time of great opportunity. Whether it’s a $50,000USD property or a $1 million USD property, there are sellers in the market looking to free up funds – and this means that many of our investors are able to access well-priced stock in desirable parts of the USA. I think that right now is a great time to buy low-cost investment properties like the ones that we sell. But I would also argue that any time cam be the right time to buy. If you think about it, in a really bad year property prices might come down by a maximum of 10%. This is almost unheard of and would be a very rare occurrence. But let’s say this is the case: and we take for example a property for $80k USD. Let’s say you wait a year for the market to drop by that 10%. You save $8,000 on the purchase price. However if you don’t wait and jump straight in today you begin earning rental income immediately. Let’s say that rental figure is $1,100 per month on the $80k property. That generates an income of $13,200 over the course of that first year – significantly more than the $8,000 saving made by waiting 12 months for the property market to drop. And what if it doesn’t drop over the course of that 12 months? Would the cautious investor wait another year and lose another year’s income? In over 10 years of selling houses in the USA I have come across some great investors and very nice clients. Some of whom have still never purchased or taken the plunge, even though we have been speaking to us for years. Their objection is always the same: “Oh maybe the prices will drop some more or maybe there will be a better house around the corner.” Yet years later they could have purchased and earned a steady, lucrative income and also an upside on the price and gained some equity. Of course, it is important to find the right property at the right price. I’m not suggesting that any investment is a good investment. What I would argue, however, is that when it comes to low cost investment properties in any country, the best time to invest is YESTERDAY – or, at the very least, TODAY! SOME OF THE GREATEST INVESTMENT QUOTES CAN COME TO MIND. WAIT AND BUY REAL ESTATE? OR BUY REAL ESTATE AND WAIT TIME IN THE MARKET IS BETTER THAN TIMING THE MARKET YOU CAN NEVER LOSE MONEY IN REAL ESTATE, ONLY SELL AT THE WRONG TIME.

Cleveland, The Investors Hotspot

If you’re looking to invest in real estate, you may have heard of the growing market in Cleveland, Ohio. Known for its rich history, diverse culture, and thriving economy, Cleveland has emerged as a hotspot for real estate investment. In this blog, we will explore why Cleveland, Ohio is becoming a top choice for savvy investors looking to capitalise on the opportunities in the real estate market. Affordable Real Estate Market: One of the biggest draws for real estate investors in Cleveland is its affordability. Compared to other major cities in the United States, Cleveland offers relatively low property prices, making it an attractive option for investors looking for affordable entry points. Whether you’re interested in single-family homes, multi-family properties, or commercial properties, Cleveland’s real estate market offers a wide range of options at affordable prices, allowing investors to maximise their return on investment. Strong Cash Flow Potential: Cleveland’s real estate market presents strong cash flow potential, which is a key consideration for real estate investors. With relatively low property prices and a steady demand for rental properties, investors can benefit from positive cash flow through rental income. The city’s diverse economy, which includes healthcare, manufacturing, and technology sectors, provides a stable job market, supporting a consistent demand for rental properties and ensuring a reliable source of rental income. Appreciation Potential: Cleveland’s real estate market has also shown appreciation potential over the years. While property prices may not rise as rapidly as some other markets, Cleveland has experienced steady appreciation, making it a stable and reliable market for long-term investments. As the city undergoes revitalisation efforts and attracts new businesses and residents, property values are expected to continue to rise, providing investors with the potential for equity growth. Economic Growth and Development: Cleveland’s economy is on an upward trajectory, with significant growth and development in recent years. The city has seen a surge in new businesses, particularly in the healthcare and technology sectors, which are driving job creation and economic growth. In addition, Cleveland has seen substantial investments in infrastructure and revitalisation projects, such as the development of the Cleveland waterfront, which has further boosted the city’s economic potential. A growing economy translates into increased demand for real estate, making Cleveland an attractive market for investors. Favourable Investment Climate: Cleveland offers a favourable investment climate for real estate investors. The city has a landlord-friendly legal environment, with reasonable property taxes and landlord-friendly laws that protect the rights of property owners. Additionally, Cleveland has a relatively low cost of living, making it attractive to both residents and businesses alike. These factors contribute to a stable and favourable investment climate that can benefit real estate investors in terms of cash flow, appreciation, and overall return on investment. Diverse Neighbourhoods: Cleveland is known for its diverse neighbourhoods, each with its own unique charm and character. From trendy downtown areas like Ohio City and Tremont to historic suburbs like Shaker Heights and Lakewood, Cleveland offers a variety of neighbourhoods that cater to different demographics and lifestyles. This diversity presents opportunities for investors to find properties in neighbourhoods with high growth potential or those that are already established and offer stable returns. Conclusion : In conclusion, Cleveland, Ohio is becoming an attractive hotspot for real estate investors due to its affordable real estate market, strong cash flow potential, appreciation potential, economic growth and development, favourable investment climate, and diverse neighbourhoods. As with any investment, thorough research and due diligence are essential, and it’s recommended to work with real estate professionals who have a deep understanding of the Cleveland market. With its growing economy, diverse neighbourhoods, and favourable investment climate, Cleveland presents a compelling opportunity for real estate investors looking to capitalise on the potential of the Midwest market. Should you have any questions relating to any of the above or if you would like to have a call with one of our experts, please email the team at : [email protected]

Cleveland still going strong after 5 years & 1700 sales

As a company Global Investments Incorporated have been selling houses in the USA for over a Decade and have over 6000 sales under there belt. For the past 5 years the companies most demanded and best selling product has by far been Cleveland Ohio. Like when the company sold in Detroit after this period of time in one market it would be normal for new markets to emerge with maybe a lower price point and higher CAP Rates or expected ROI. This is however not the case with Cleveland and after 5 years and over 1700 sales the demand for the city is bigger than ever and right now Cleveland Ohio still provides some of the best valued houses with solid CAP rates and returns for both the overseas and Domestic investors. Coupled with great on the ground management companies that Global have been working with for many years these types of buy to let houses really do tick a lot of boxes for most seasoned or new investors. As a company we would have probably expected that after prices have increased over the past 5 years and investors can sometimes get bored seeing the same product or sometimes think they have missed the boat etc that we would have had to ventured into a different market. We did try a few areas like Chicago and Memphis etc but surprisingly enquiries and demand is still highest in Cleveland. With the average single family home selling at around the $58-60k mark and Duplex’s around $70-80k and net returns anywhere between 15%-20% there are still great opportunities for investors and we expect to at least get another 2-3 years selling in the city before prices hit a high and we have to look elsewhere. I also believe that unlike areas like maybe Detroit, the investment into the city is still pouring in and investors still see after this period of time that the city still has a long way to go and prices will continue to rise giving not only a solid ROI but potential growth as well. Companies like Key Corp, Morgan Stanley, Sherwin-Williams and individuals like Dan Gilbert are still investing heavily in the city. The City itself also spending millions of dollars improving the lower income neighbourhoods. All of these factors making Cleveland still a hot investment area for this year and into 2024. Mike Moodie CEO Global Investments Incorporated. The Future is bright and strong for CLEVELAND OHIO. If you would like more information on what is going on in Cleveland or any of our current opportunities please email Mike or any of the team at Global at [email protected]

What Real Returns should I expect from my US Investment and where are the pitfalls

Investors from all over the globe are being attracted by the high returns advertised in the USA by companies selling in areas like Detroit, Cleveland, Chicago etc and sometimes we even see potential returns of up to 24%. From the layman’s perspective these types of investments with such lucrative returns seem like a real no brainer but the words “ too good to be true “ can come to mind. Are such high returns really possible? Global Investments Incorporated have been selling these types of investments for a decade now so who better to ask than the companies CEO Mike Moodie about what “ REAL “ returns which can be achieved by such investments and what are the pitfalls or mistakes if any that investors should be looking out for ? Mike was quoted in saying “ well the first thing that I would like to say is that there is no investment without risk, in my opinion good investment is about minimising the risks in certain types of investments. I think that there are several factors investors should consider and look at before entering such a market that maybe a lot of companies out there would not share. “ 1.Don’t just look at the ROI. – I think that investors sometimes can make the mistake of only concentrating on the net ROI of a property. Lets think about what makes a high return. Low price and high rent coupled with low taxes. Normally the lower the price of the property the lower the calibre of the location or the neighbourhood. I believe that investors should try and find a balance between price, location and return and not always being drawn to the lowest prices and highest returns. Sometimes we can forget about the potential uplift on the price and growth potential. Of course normally the better the location or neighbourhood the more likely you are to see potential growth in the coming years. Also another factor in this would be the exit strategy and again a property located in a better area would be easier to sell when the time comes to cash in on your investment. 2. The two unknown factors – There are two factors of this type of investment that you would rarely see on any companies marketing materials as they are impossible to predict but investors should be made aware of them as both of these can have an effect on any potential ROI. Vacancy – At some point like with any rental home any where in the world the house will at some point become vacant as tenants do not live in the property for ever. How can we minimise the risk of vacancy ? Well again we get back to my earlier point about location, the better the location and neighbourhood then the more chance you have of replacing a tenant quickly. The nicer the area then the more demand you would have for rentals. Also in relation to vacancy it is imperative that you have good management in place. ( I will come to this later ) Maintenance – the second unknown factor would be maintenance or repairs on your property which of course is the responsibility of the landlord. This is an impossible figure to quote any investor as it would of course vary from property to property and also depend on the condition of the property when the investor closes on the sale. ( This is one of the reasons we would always recommend the buyer carries out an independent third party inspection ) The way to minimise the risks of maintenance is firstly when we see the inspection before we close is for us to ask the Seller to take care of any minor maintenance issues that arise from the inspection meaning these repairs are not necessary when the new buyer takes possession. I think the main thing to look at when trying to avoid maintenance is buying a house that has been recently rehabbed or updated so the house is in a excellent condition when you buy it. Yes you may pay more for this in the long run but over time it would pay off as maintenance in the first few years of ownership would be minimal. 3. Management – In my opinion this is the single most important factor when trying to maximise your returns out of USA buy to let homes. It can also be the most challenging. Remember that you can buy the best located, tenanted home but if it is managed badly then it can turn into a bad investment. I have heard examples of good tenants leaving properties as they did not like the managing agent. As a company we only work with reputable companies in all the areas that we sell in and that have been in business for many years and have excellent knowledge of their given marketplace. This is key to making any investment like this work and also minimising the risks like maintenance and vacancy discussed earlier. 4. Get three quotes – Always ask your management company for three different quotes for any maintenance work needed on the property. Sometimes only saving 100 dollars here and there can have a massive impact on returns over long periods of time. Your management company should have no issue with you asking for this and maybe even involving third parties. I believe that the USA buy to let market provides excellent opportunities to investors both domestically and internationally. The market can be lucrative with excellent returns but investors have to understand the above can have an impact on their actual net return over time. From experience I think that you should always look to deduct maybe 3-4% off the advertised ROI so you can factor in any vacancy or maintenance that may arise in the given years ahead. So if the property is showing a 18% net Return then maybe look at that as 15% which is still a very healthy return on your money. Mike Moodie – CEO

Detroit 2023 Property news

Detroit Aims to Spur New Housing, Boost Property Values With Tax Change Detroit city officials are weighing a radical change to the way the city taxes property, which proponents say will help revitalise the city and become a model for the Rust Belt. Detroit would be the largest U.S. city to introduce a so-called land-value tax. Like most U.S. cities, Detroit calculates property taxes by estimating the value of a property’s land and buildings and charging a fixed percentage each year. Under the proposed change, the city would replace some property levies with a single tax on the land value only, according to people familiar with the matter. That means owners of vacant land would see their tax bills skyrocket, while the tax bill for many homeowners and commercial-property owners would fall. That in turn would push up home values and encourage more property owners to build, said Roderick Hardamon, a local real-estate developer who supports the change. Black homeowners have been hit particularly hard by declining values in recent decades, and proponents say the change could help shrink the region’s racial wealth gap. The tax change has a couple of legislative hurdles to clear. First, it would need state approval. Then it would need to win a majority of Detroit voters through a ballot measure. Detroit Mayor Mike Duggan has said the city is “80% of the way to a solution” on a new tax system, a spokeswoman said. The speaker of Michigan’s house of representatives, Joe Tate, supports the new tax policy, which is also backed by a number of advocacy groups, economists and property developers. “Reducing the tax burden creates stronger communities, not only in Detroit but across the state,” Mr. Tate said. Other mayors and housing advocates see Detroit as a crucial test case for this tax policy, one that could open the door for other cities to follow. “I think this is a policy that works in any city in Michigan and works in a lot of distressed cities in a similar way,” said Nick Allen, a Ph.D. student at the Massachusetts Institute of Technology and former manager at the Detroit Economic Growth Corporation, who has been pushing for the tax change. Detroit has many vacant lots and a lack of development. Investors, many from out of state, bought up land and kept it vacant, waiting for prices to rise, according to developers and community activists. A declining population pushed down home values and property-tax income in recent decades, leading the city to raise tax rates to make up the shortfall, causing more people to leave and pushing home values lower. In a study published last year, Mr. Allen and John Anderson, a professor of economics at the University of Nebraska-Lincoln, estimated that more than 96% of Detroit homes and small rental buildings would see their property-tax bills fall as a result of the proposed change. That, along with an expected increase in development, could help push up residential-property values, they said. If you are ready to invest in the Detroit housing market, or wish for a call and more information on the latest properties Global Investments can offer then please email us today at : [email protected]