As U.S. Property Overheats, Here Are The Top 6 Places To Go…
We’re in a frothy situation…
Right now, the United States is one of the most overheated property markets in the world. Low interest rates, stimulus check savings, and limited housing stock are all contributing to a rise in property prices across the land.
With a national price hike of 15% over the last year, the Financial Times reports that it’s harder today to find an affordable home in the United States than it was at any point during the 2008 financial crisis.
For those looking to relocate within the United States for a better quality of life in retirement, the options are limited. Prices in the traditional go-to spots of California, Florida, Arizona, and the Carolinas are getting further out of reach…
But, if you’re looking at markets overseas, it’s an entirely different story…
In the top markets on the LIOS radar for retiring overseas, you can save 50% to 80% (and more) on what you’d pay in the top U.S. retirement spots.
Today we’ll take a look at some of these alternative retirement spots. But first, a couple of important notes…
To make this data meaningful, I’m comparing apples to apples. Or in this case, beachfront to beachfront… historic quarter to historic quarter… 100-square-meter two-bed unit to 100-square-meter two-bed unit.
That said, no two cities in the world can offer exactly the same set of attractions. But I’ve matched each pair carefully so that they offer a similar experience. In comparing Texas with Colombia, for example, you may not find as many live music venues in Medellín as you would in Austin. Maybe, though, you’ll find Medellíns “eternal spring” weather and outdoor amenities more appealing.
Let’s get started…
Texas vs. Colombia
For three years running, U.S. News and World Report ranked Austin, Texas, the top city to live in the United States.
Austin is famous for its live music scene—and, in recent years, it has emerged as a smart, innovative city. Other attractions for retirees include its wide outdoor spaces and arts scene.
If this is the kind of lifestyle you’re after, then take a look at Medellín, Colombia—a city that’s transformed itself over the past two decades and continues to push forward. In 2013, Medellín was named “Most Innovative City” in the world. Popular among expats for its springlike weather year-round, it offers a healthy lifestyle with plenty of green space and the opportunity to spend more time outdoors. With dozens of museums and art galleries, botanical gardens, and a literary scene, Medellín is one of the most culturally appealing cities you’ll find south of the border.
Cost to own in Austin, Texas:
Over the past year, homes in Austin have risen by an average 35%. Average square-meter price in Downtown Austin is US$8,300. A luxury two-bed/two-bath condo of 140 square meters in a nice location, close to bars, restaurants, shopping, and parks is on the market for US$565,000.
Cost to own in Medellín, Colombia:
The most attractive area for U.S. buyers is the upscale neighborhood of El Poblado. Here, prices are an average US$1,700 on existing property; US$2,000+ for new builds. On the market in El Poblado is this high-end, two-bed/two-bath penthouse that’s close to restaurants, parks, shopping, movie theaters, and the business district. It’s asking 750 million COP/US$187,550.
Florida vs. Brazil
Not surprisingly, Florida dominates Conde Nast’s “10 Best Places to Retire in the U.S.” Its beach towns take four spots—including the top two. Top of the list is Fort Myers, offering the best of Florida’s beachside lifestyle without the crowds. Sarasota takes second place—its strength being a top beach lifestyle with lower property prices than Tampa or Naples.
If you’re a beach lover, there’s little compromise in swapping Florida’s sunny coast for the world-class sands of northeastern Brazil.
The standout city along this northeast coast is Fortaleza. Along with its surrounding beach destinations, Fortaleza is a major draw for foreign real estate investors. And it’s also a hub for Brazilians, Europeans, and North Americans seeking a second home, drawn by the area’s fine sandy beaches, great weather, and rich lifestyle.
For better value—and the opportunity for uncrowded beaches with little to no high rise—look to the stretch of coast 90 minutes south of Fortaleza, around the popular resort of Canoa Quebrada. That’s where prices get exciting.
Cost to own in Sarasota, Florida:
The average price for Downtown Sarasota is US$4,000 a square meter. Prices get higher the closer you get to the sand. In a small development, a half-block back from the beach, a 42-square-meter condo is on the market for US$325,000.
Cost to own in Northeast Brazil:
Near the resort of Canoa Quebrada, you can own a 37-square-meter, one-bed villa just steps from a white-sand beach—with its own plunge pool and private terrace—for just US$57,000. (Cash buyers pay just US$47,000.)
Hawaii vs. Northern Cyprus
If you’re drawn to island living, Hawaii is a natural starting point. In Bankrate’s recent ranking of the 50 states (based on factors important to retirees like affordability and weather), Hawaii came in tenth.
Maui is a top choice with retirees for its beaches and opportunity for diving, snorkeling, and surfing.
Looking beyond U.S. borders, you’ll find all of the above on the Mediterranean shores of Northern Cyprus. In this former British Colony, English is widely spoken, the weather is warm year round, and property prices are a fraction what you’d find elsewhere in the Med. This area has a rich culture and a growing expat community.
Cost to own in Maui, Hawaii:
Average square-meter price in Maui is around US$7,600. Right now in Ma’alaea Bay, you can buy a one-bed, 52-square-meter condo on the beach for US$382,000.
Cost to own in Northern Cyprus:
Average square-meter price in Northern Cyprus is around US$1,300, and upward of US$1,500 for beachfront. In a new beach development here, you can buy a one-bed, 52-square-meter apartment—with a terrace and ocean views—for US$90,000.
Arizona vs. Panama
For retirees looking for an active outdoor lifestyle, it’s hard to beat the cities of Scottsdale and Prescott, Arizona. Those seeking better affordability tend to settle in Prescott. Unlike other parts of Arizona, Prescott offers mild weather and the opportunity to be out of doors all year.
The combination of its stunning natural setting, temperate climate, and large expat contingent makes the mountain town of Boquete a natural choice for those contemplating an outdoor lifestyle. Here you’ll find a range of activities from zip-lining to white-water rafting to golf to hiking up Volcan Barú.
The town is not short on culture either. Each February, local and international artists come to Boquete for its annual jazz and blues festival.
Many folks choosing to move to Boquete are looking for a tranquil lifestyle. So, for this comparison, we’ll focus on detached homes a little out of town. Once you travel five to 10 minutes out of town, average prices are US$500 to US$1,000 a square meter.
Cost to own in Prescott, Arizona:
Average price in Prescott is US$3,324 per square meter. Close to downtown but set in tranquil woodland, a three-bed, 325-square-meter home is on the market for US$950,000.
Cost to own in Boquete, Panama:
Average prices in Downtown Boquete are around US$1,400 per square meter. In Alto Boquete (just five minutes from town), a luxury, contemporary three-bed home of 334 square meters is asking US$299,000.
South Carolina vs. Portugal
South Carolina is a popular choice for U.S. retirees—not only for its beaches but also for its historic charm. The port city of Charleston oozes elegance with its cobblestone streets, horse-drawn carriages, and sophisticated French quarter.
Across the pond, the city of Porto (Portugal’s second city) is the perfect rival. Globally known for its exquisite port wine, the city is surrounded by the enchanting Douro Valley. The valley itself is a UNESCO World Heritage Site and was the world’s first demarcated wine-producing region. In Porto’s older neighborhoods, you’ll find rows of colourful houses, crisscrossed by tiny cobblestone alleyways that are home to cozy cafés, restaurants, and bars.
One of the best lifestyle neighborhoods to consider—that still offers affordability—is Cedofeita… a quiet area that’s close to amenities and has strong public transport connections.
Cost to own in Charleston, South Carolina:
Average price per square meter in Downtown Charleston is US$5,600. A 98-square-meter condo in a historic building is on the market here for US$575,000.
Cost to own in Porto, Portugal:
Average square meter price in Porto today is 2,800 euros (US$3,300). In Cedofeita, next to the subway, a 100-square-meter, renovated apartment (with a garden) is on the market for 220,000 euros/US$258,150.
California vs. Mexico
For ocean lovers, it’s hard to beat the crash of the Pacific. Fortunately, those same great wide beaches and surf that California is famous for don’t stop at the U.S. border. For years, expats have been finding great values farther south… on the Pacific shores of Costa Rica, Nicaragua, and Mexico.
Among the choices, Mexico comes out tops. In fact, among all the countries of the world, Mexico is home to the largest number of U.S. expats. If you’re not planning on retiring just yet, you have the option to rent out your property to other expats (long term) or go after short-term vacation rentals. One city that offers the option to do both is Mazatlán… the beaches here are reminiscent of Venice Beach in L.A. And, beyond the sand, you have a colonial city that attracts visitors apart from the usual beach-goers.
Cost to own in Venice Beach, California:
Average price in Venice is in excess of US$13,700 a square meter. Just off the beach, there’s a two-bed, 131-square-meter luxury condo for sale at US$1,245,000.
Cost to own in Mazatlán, Mexico:
Mazatlán is one of today’s best buys for beachfront property with averages at less than half the price of better-known Puerto Vallarta. Average square-meter price for beachfront is around US$1,700. In a luxury pre-construction project on the Mazatlán boardwalk—with views over the lagoon and Central Park—you can buy a 130-square-meter, two-bed condo for 4.26 million Mexican pesos/US$212,100.
United States Vs. Overseas—How Much Can You Save?
To wrap up, here’s a quick summary of the discounts you can expect by going overseas—based on the average price per square meter in each market.
|U.S. Destination||Av. price per sqm||Overseas
|Av. price per sqm||Discount|
|Austin, TX||US$8,300||Medellín, Colombia||US$1,700||79%
(2-bed luxury condo in upscale neighborhood)
|Sarasota, FL||US$4,000||Canoa Quebrada, Brazil||US$1,600||60% (beach bungalow)|
|Maui, HI||US$7,600||Northern Cyprus||US$1,500||80% (1-bed beachfront condo)|
|Prescott, AZ||US$3,300||Boquete, Panama||US$1,400||57%
(luxury 3-bed home outside center)
|Charleston, SC||US$5,600||Porto, Portugal||US$3,300||41% (renovated 2-bed condo in historic area)|
|Los Angeles (Venice), CA||US$13,700||Mazatlán, Mexico||US$1,700||87% (luxury 2-bed condo on beach)|
Editor, Overseas Property Alert