How To Find The Geographical Area To Invest
“Buy in a suitable region”
What exactly constitutes a suitable region?
A good region
temperate climate
access to a quality lifestyle
a solid commercial/industrial base
There needs to be incentive for people to continue to migrate there.
Those conditions provide a healthy population growth. In addition, the cost of living should be lower than the average in other states and with affordable home prices.
For example, the Sunbelt. This is a region of the United States that stretches across the South and Southwest and covers approximately one third of the geographic contiguous continental U.S. (from Florida to Arizona and may include Georgia and portions of the Carolinas). The Sun Belt is well known for its warm climate and long summers; which also means shorter, relatively mild winters. People are looking for warmer, more comfortable climates. Accordingly, the Sun Belt has had substantial population growth in the last few decades. It has a growing economic environment. This makes it attractive to young families, as well as many baby boomers.
According to a recent Forbes Magazine study,
“In the coming decades, the United States is going to look a lot greyer. By 2050, the number of Americans over 65 will almost double to 81.7 million, with their share of the overall population rising to 21 percent from roughly 15 percent now, according to Census projections. More than 10,000 baby boomers are turning 65 every day. Virtually every part of America will become more senior-dominated, but some more than others. The most aged regions come largely in two forms. Retirement metro areas are older in large part due to longstanding patterns of senior migration. And where are seniors still relatively thin on the ground? Mostly in the booming sections of the Sun Belt, places that have long enjoyed considerable positive in-migration from both other states and abroad. Three of the five least senior-dominated places are in Texas, including Austin (9.4 percent), Houston (9.8 percent) and Dallas-Ft. Worth (10.2 percent). The other two include Salt Lake City, the family friendly Mormon capital where only 9.6 percent of residents are over 65 and high-tech capital Raleigh (10.6 percent).”
The Sunbelt region is where the baby boomers are going. There, great industries large and small are developing with an excellent employment rate and a high and growing rate of migration. It is primarily concentrated in major cities, where there are good schools for children and educational opportunities for adults, combined with a low crime rate.
An article written by Kaitlin Ugolik, on “Law360”, states that...
“Institutional and private equity investors are flocking to the Sunbelt states to buy up real estate portfolios in growing numbers, taking advantage of improving economics in some of the areas hit hardest by the recession, experts say....as employment numbers rise and interest rates remain low, real estate attorneys say they are seeing more and more real estate-focused private equity firms and real estate investment trusts search for yield in the Sunbelt. In San Francisco, for example, housing has become pricey and competitive. The same can be said for Miami, and potentially soon for Austin and Houston.”
Why Texas?
New Dawn Investments focuses specifically on Texas. There is a favorable mixture in Texas’ economic conditions, natural resources, infrastructure, political environment, strategic geographical location and even the weather. Texas holds the perfect opportunity for growth that is needed to develop a thriving real estate investments portfolio. Even when the U.S. was hit by the latest recession, Texas continued to be the fastest growing state in the nation! This growth, coupled with great economic stability, fueled a huge migration to Texas. With our years being interconnected with builders and other key players in the real estate field, we gain further discounts and benefits on top of the one Texas provides alone.
Of the 24 million people living in Texas, 80% of them live in the Dallas/Fort Worth (DFW), Houston, San Antonio and Austin regions. An estimated 14 million more people will migrate to the state by 2030. According to data released by Texas Secretary of State Nandita Berry, new businesses continue to open at a very fast rate. In 2014 alone, there was an 11 percent increase in business development. Texas experiences year to year growth in new business filings.
Due to the opportunities available, most of this growth is occurring from Denton (just north of DFW), to San Antonio, to Houston and back to Denton. Approximately 68% of all jobs in Texas are in DFW, Houston, Austin and San Antonio. Almost 90% of all jobs in Texas are concentrated in the metropolitan areas. Texas clearly needs to build more homes and fast! The more demand there is for homes, the quicker the prices of houses rise. Time is of the essence!
In an article written By Tom Geoghegan (“BBC news magazine”, BBC News- Washington), lists the main reasons why so many people are moving to Texas:
1. Jobs – The “unconventional” oil and gas industry continues development and turned Texas into an economic mega-power state; particularly in the world's energy capital Houston. Growth has also been strong in the technology, manufacturing and business services sectors.
2. It's cheaper - New York, L.A. and the San Francisco Bay Area are too expensive for most people to live in these days. Houston has the highest 'effective' paycheck in the country. Meaning that your paycheck’s purchasing power compared to the cost of living is the highest in the nation. People can live comfortably and even save for their future!
3. Homes – Buying a home and/or land continues to be one of the cheapest in the U.S. and Dr. Ali Anari, research economist at the Real Estate Center at Texas A&M University, declared the “process of land acquisition very efficient”.
4. Low tax - Texas is one of only 7 states where there is NO STATE INCOME TAX!! Residents pay no personal state income tax. There are also tax incentives for businesses and recently legislators cut more than $1bn off proposed business taxes.
5. Pick your own big city - Texas is considered to have 6 of the “US’s 20 biggest cities”, compared to other states that, at in many cases, barely even have one big city. More specifically, the Austin metropolitan area has immense economic growth, a continually developing industrial/mercantile rate, high quality of living standards and is very environmentally friendly! Austin is the Capital of the State of Texas and three major colleges (The University of Texas at Austin, St. Edward’s University and Huston-Tillotson University) call it home.
6. Family-friendly – Because of its good-value (purchase price) housing, jobs, great schools, etc., Texas is a very popular place to raise a family. San Antonio is home to the largest community of gay parents in the country.
7. Fewer rules - There are a lot less business or city (municipal) rules and regulations than most states. Texas is pretty liberal in the classic, traditional business sense.
8. Very social environment – Texans pride themselves on being unpretentious, down-to earth people, who are easy to get along with.
9. Appreciation rates anticipated
Predictions from real estate experts indicate the anticipated rate is great for the near future! According to an article in FORBES magazine, real estate experts expect that “more homes will be available” and “new construction and rising prices” will continue to feed that trend.