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US What Obama's win means for US property buyers

Property Here - Wednesday, November 07, 2012

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America has voted and Barack Obama has won, but what will the vote mean for the increasing number of overseas property buyers and investors from Southeast Asia who are looking stateside?

‘Don’t count on the election to boost housing’ screamed the headline on one of the country’s most-read real estate news websites yesterday. Most industry observes shared the same view; nothing much will change short term in the U.S. housing markets regardless of who the next incumbent of the Oval Office will be.

The latest government housing data paints a somewhat encouraging picture with new home sales recording a two-year high in September and foreclosures falling in 62 percent of U.S. cities during the third quarter.

Yet housing issues were, according to exit polls conducted by The Associated Press and U.S. television stations, pretty low in the minds of American voters on Tuesday. Rising prices and unemployment were cited, understandably, as the main concerns.

The question on the minds of many overseas property investors is whether, in general, property prices in the U.S. have hit the bottom. There’s no clear answer to this because in some places prices have been rising for more than a year, while in others there’s arguably further to fall. 

Some kind of overseas property buyers’ tax, similar to that introduced in Singapore in December 2011, would certainly win fans at home. It wouldn’t be a surprise, and indeed could well form part of future housing and property policies – especially when the market really starts to take off.

Foreign buyers of U.S. property focus their attentions on three key states. Florida accounts for the vast majority – more than 57 percent – with Michigan (13 percent) and New York (11 percent) occupying second and third spots. Together, these three states account for more than four of every five foreign property purchase in the United States. Yet the proportion of overseas buyers in the U.S. is still small – just 8.9 percent in the year ending March 2012 according to the National Association of Realtors.

Andrew Batt, International Group Editor of PropertyGuru, said: “Property buyers and investors from Southeast Asia have been watching developments in the United States with interest. Even last weekend there was a New York property investment opportunity being showcased in Singapore, and properties from throughout the country have been selling well this year. It will likely be several months before the President starts to fine tune policies which have the potential to impact overseas buyers.”