Investors in the US coming back to real estate, survey suggests

Investors in the United States are expected to outnumber traditional residential property buyers three to one in the next two years, according to a new survey.

The Move Investor survey also suggests local markets will be heating up with renewed investor interest and activity. Compared to a year ago, 62% of investors are paying more attention to home values in their local markets. Only 43.5% say it will be harder to find bargains and 41.5% expect it will be easier to sell their properties in the next six months.
 
Meanwhile, 22% of investors are bullish and expect prices to rise in the next six to 12 months, and 53.5% expect prices to remain relatively the same. Some 23% expect prices will fall in the next six to 12 months.

Half of the real estate investors surveyed say they plan to hold their properties for five years or more and many expect high yield returns. Only 11% expect to sell within 12 months of buying it. Nearly half of the investors surveyed expect a profit of 20% or more from their investment, 40% expect a profit of 10% and 6.5% expect a 5 or less return on investment.
 
Over half, 56% of investors plan to turn their investments into rental properties. Also, the survey found that 28% plan to purchase a holiday property and 30% reported an interest in buying retirement property as an investment.

When it comes to repairs and maintenance, 56.5% of investors say the repair and maintenance of investment property has not been difficult. Some 42% plan to invest their own time and energy to improve, repair and maintain their properties. Of the remainder 29.5% said they’ll hire a contractor for repairs while 28% said they would buy properties that don’t need work. The majority, 65.7%, don’t expect repair costs to exceed 20%of the property’s purchase price.

There are also signs that new investors are coming into the market. Nearly 60% of investors say they're new to real estate investing with 33% considering their first investment purchase and 8.5% in the process of buying and selling their first investment property. Of those surveyed, only 36.5% had experience in more than one property transaction.

‘This data suggests today's climate is hot for investing and is attracting a lot of new people that don't fit the stereotypical deal driven flippers that buy and sell properties quickly,’ said  Steve Berkowitz, Move Inc. chief executive officer.
 
‘They're mostly entrepreneurial individuals that will make vital contributions to local communities by investing their own money and sweat equity to improve and maintain properties. These personal sacrifices made over the long run will help improve housing stocks, home values, property tax bases, and thousands of local communities,’ he added.