Picking the next up and coming place to buy cheap and reap the benefits of rising rents and higher home prices is one of the tricks of successful property investment.
Spotting these opportunities may not be that hard – if investors follow some key trends.
In the US, many investors track job availability and the ebb and flow of talent across the country to help select their investments.
Everyone knows property prices have hit rock bottom in Detroit as workers moved out in their droves to leave the once proud motor city bankrupt.
But few had the foresight to look at where they may have gone and the effect this migration may have had on property prices elsewhere.
Fastest growing cities
Detroit is just one example, but the key sectors for investors seem to be technology and energy.
Thousands of workers are moving to where the jobs are – and in many cases these locations offer value for money property and a lower cost of living.
The traditional sectors for talent were legal and financial services, but these are giving way to the rising importance of the new key sectors.
The fastest growing populations are cities like Houston, Dallas, San Antonio and Austin in Texas and San Jose, California.
According to official population figures from the US Census Bureau, more than 34,000 people moved to Houston in the year ending July 31, 2012 – second only to the rising numbers moving to New York.
Texas is at the centre of energy exploitation in the US, with vast oil and gas deposits.
San Jose welcomed almost 13,000 new inhabitants.
Lure of energy and technology
The magnet drawing these people is jobs, but they also need somewhere to live.
That’s where property investors can track the trends. Comparing population migration to where to look for homes to rent out to the incomers is a trend that can indicate where to buy property.
“Job markets like insurance and finance are dropping off,” said a spokesman for international property consultants Colliers International.
“The economy is the main driver of population growth and the main demand for jobs comes from energy exploitation and technology. Texas benefits from the first, while San Jose and Silicon Valley is where technology reigns.
“Join the dots and demand for jobs is increasing populations in some areas, and these areas are where demand is on the rise for homes.”
Taking Houston as an example, local planners have seen the number of building permits shoot up by a third, while the number of new homes built over recent years has mushroomed by nearly 45%.
