Harry S. Dent | Tuesday, November 27, 2012 >>

Yesterday I warned you about nine places in the U.S. where the real estate crisis is far from over. If you missed that issue, you can read it again here: Warning: 9 Places Where A Second Property Market Bust is Brewing

As I explained, the property market is like a popcorn maker. All the kernels pop, just at different times. Some must still pop so we expect to see another 33% to 50% decline in property values in particular places around the country.

Other kernels have already popped and are ready to eat.

Let me be clear about this: in general I warn you to stay the hell away from the real estate market for the next several years. But, if you are determined to get back into property, it’s a good time to buy a foreclosed starter home at 70% to 80% off… and then rent it out for positive cash flow.

Here are 3 best places to buy in the U.S.

Phoenix, Arizona:
Since 2005, the bust has erased its entire bubble in Phoenix. That’s a really good sign and people are already starting to buy more there. When you can rent a starter home for a positive cash flow, like you can in Phoenix, you know real estate is affordable again.


There’s a similar situation in several cities in Nevada…

Las Vegas and Reno have also erased the real estate bubbles. Here’s the Case Shiller chart of Las Vegas to illustrate…

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Las Vegas has already hit our worst-case-scenario level of 90 on this index. Reno is also at the bottom, with maybe a few percent more on the downside.

Atlanta is definitely a place to look for property. Look at this chart…

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During the bubble years, there was great over-building in Atlanta, and while it never bubbled quite as much as other places in the U.S., it is in a good place now for investors.

In fact, Atlanta is in a zone where hey, if I was part of a young couple, I’d feel good about buying a home there at those prices… or if I was an investor and wanted to buy foreclosures, then rent them out at positive cash flow, Atlanta looks good.

So there you have it: The worst and best places to buy property in the next few years. No matter where you decide to buy (or not), do yourself a favor. Find a price index for the area. Zillow is a good place to look. Mark where the property bubble started and where prices are currently. Then note how far they have to fall to reach pre-bubble levels.

If you can’t stomach that level of risk, stay away.




Ahead of the Curve with Adam O’Dell

Rent vs. Buy – What’s Better?

The last four years have treated landlords quite well. And it’s obviously the housing bust we have to thank for that. As displaced homeowners move out and on, they’re increasingly choosing to rent. That’s meant high demand for rental properties and the ability for landlords to raise monthly rates.

So let’s look at two charts today…



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Harry Dent
Harry studied economics in college in the ’70s, but found it vague and inconclusive. He became so disillusioned by the state of the profession that he turned his back on it. Instead, he threw himself into the burgeoning New Science of Finance, which married economic research and market research and encompassed identifying and studying demographic trends, business cycles, consumers’ purchasing power and many, many other trends that empowered him to forecast economic and market changes.