Yesterday we looked at why real estate in the US may offer good value and were left staying at an excellent Best Western Motel in Barstow, California. If you missed the first two messages in this series they are at: www.garyscott.com/international_investments/international_investments_97.html
Our last two messages outlined how 40 years ago Merri and I began adventures that have led us to live, work in and visit over 70 countries….plus how it led us to a 6,514 miles drive around the United States.
Yesterday’s message also promised an unusual prediction about Oklahoma. See it below.
Day #2 of our return saw us race from New Mexico, through Texas, Oklahoma, Arkansas and into Tennessee past Memphis. Talk about tired! We did take time though to visit the Painted Desert in the Petrified National Forest, another must see and in October it was empty.
The final day was a snap riding up through Nashville, Knoxville, Bucksnort TN (this is the favorite name I collected in the trip) and back up into the Blue Ridge.
Yes there is a Bucksnort! You can learn more at http://www.answers.com/topic/bucksnort-tennessee
This site says: Bucksnort, Tennessee is a small community located in Hickman County, Tennessee, USA. It occupies Exit 152 on Interstate 40 a few miles east of the Tennessee River. There is no U.S. Census data for the location and there is no post office.While some have speculated the community gained its name in relation to the large number of deer in the area, the most often told story about the name dates back to the 1880s, and the owner of a local mercantile named Buck, who sold moonshine on the side. Nearby residents would say they were going to “Bucks to get a snort”, hence the name “Bucksnort”.
See this picture and more at http://www.3dphoto.net/world/united_states/kentenn/bucksnort2.jpg
Focusing on places like Bucksnort may seem a far cry from being international, but I believe that small communities like this will have a profound affect on the economy over the next 34 years.
Real estate prices have the potential to really rise in the heartland of America in areas such as those that run along I-40.
The USA Today article “Where will everybody live?” by Haya El Nasser (we reviewed yesterday) can help us understand this. It shows that the American population has risen from 200 million to 300 million in 39 years. At present growth rates the next hundred million will come in only 34 years! American now take 20% more developed land (housing, schools, stores, roads) than 20 years ago. These 100 million additional people will need 70 million new homes and 100 billion square feet of non residential space.
The article suggests that transportation, energy and water will be the big issues in the next 34 years. It points out several areas where utility change can help prices rise. Brownfields (industrial sites along river banks, old warehouses and other abandoned sites like gas station, parking lots and strip shopping centers because they represent good building sites. Areas around rail lines that can be converted for public transportation. Low rise areas where buildings can rise higher. Cities (such as Detroit and St. Louis) where populations have fallen.
There are other changes in utility that can create shifts in property price. Boomer migration is one change. A survey a few years ago found that many boomers plan to move from the city to smaller areas not too far away for where they now reside. Growth in work at home is another huge change. More and more people will be able to move to less expensive, less crowded communities and work or run a business via the internet as Merri and I do. Change in values is a third shift. As life in crowded cities become more crowded, more hectic and more criminally attacked, more people will want to move to quiet places like Bucksnort. Technology and retirement income will alow them to do so. In fact loss of purchsing power of retirement income will force many to do so!
These mid American areas have water..lots of it to begin. They are quiet, peaceful, scenic, have broadband and are easily accessible to the big cities.
Plus they are more affordable!
Take Henryetta, Oklahoma as an example. Population about 6,000. Median household income about $20,000. Median house price $38,000. The cost of living is obviously very low for such a pleasant area. Though winters may be harsh, this location has a feeding ground for retiring boomers from Oklahoma City, Tulsa, Dallas, Little Rock, Amarillo and Lubbock at the least.
This is just one of many examples. Learn more at http://www.city-data.com/city/Henryetta-Oklahoma.html
There is one more reason why Mid-America may grow. As the US dollar falls, Americans will not be able to compete with overseas buyers for coastal land. Overseas buyers come to visit and invest. Most stop and buy somewhere near their landing. Asians buy on the West Coast. Europeans and Mid Easterners tend to buy on the East and Gulf Coast. This pressure pushes US real estate costs above normal levels. You can see this phenomenon in places like Naples where the rich come from all parts of the world and drive prices beyond the ability of middle class home owners. London is another great example of this. A modest house in London costs $750,000 or more! In central London, prices begin in the millions. This is because every person from the Commonwealth of many nations who has a little extra cash wants a London Pied a Terre. Middle class English cannot afford to live in central London!
So the famous quote, “Go West Young Man,” may shift to “Go Mid America Middle Class Man..and Woman”. Keep yours eyes on Oklahoma and surrounds.
And until next message, enjoy good life and investing wherever you are.
We have 3 spaces left in Ecuador. Learn about low cost living and good value real estate in Ecuador. See this home and much more. Join us in Ecuador for our International Business and Investing Made EZ Course beginning November 9. Hope to see you there! See https://www.garyascott.com/catalog/IBEZec/
Meet the three architect brothers Fausto, Ramiro & Julio Acosta who started Barro Viejo as a result of their passion for architecture and the love for the Andean land, history and culture. They can build a home like this for as little as $75,000.