Financial markets in the United States are the largest and most liquid in the world.
The Financial Services Industry In the US
In 2014, finance and insurance represented 7.0 percent (or $1.223 trillion) of U.S. gross domestic product. Leadership in this large, high-growth sector translates into substantial economic activity and direct and indirect job creation in the United States.
Financial services and products help facilitate and finance the export of U.S. manufactured goods and agricultural products. In 2014, the United States exported $104.7 billion in financial services and had a $35.01 billion surplus in financial services and insurance trade (excluding re-insurance, the financial services and insurance sectors had a surplus of $67.5 billion). The financial services and insurance sectors employed 6.08 million people in 2015. The securities subsector of the industry shows great potential for employment growth, with a 12 percent increase expected by 2018. According to the U.S. Department of Labor, 920,700 people were employed in the securities and investment sector at the end of 2015.
Banking: As of the end of 2015, the U.S. banking system had $15.967 trillion in assets. It supports the world’s largest economy with the greatest diversity in banking institutions and concentration of private credit. In 2015, net income was up 7.3 percent to $161.6 billion.
Asset Management: The U.S. asset management subsector is unrivaled in its depth and diversity. U.S. asset managers are currently meeting the pension management needs of over 60 percent of the global retirement market. Total U.S. pension assets were $24.5 trillion at the end of 2015. Moreover, if insurance assets and mutual funds are included, U.S. asset managers held more than $51.1 trillion of long-term conventional assets under management in 2015, or 47.2 percent of the global total for these funds. Conventional funds were equivalent to 294 percent of U.S. GDP.
Insurance: In 2014, the insurance industry’s net premiums written totaled approximately $1.15 billion. According to the SNL Financial LC, premiums recorded by life and health insurers accounted for 44 percent, and premiums by property and casualty insurers accounted for 56 percent. Additionally, about one-third of all reinsurance sold worldwide is bought by U.S. firms. International insurance companies are actively seeking business partnerships and collaborations with U.S. insurance companies.
Venture Capital: The venture capital industry was created in the United States and our venture capital ecosystem continues to support many of our most innovative companies. In 2015 new commitments to venture capital funds in the United States totaled $28.2 billion, and total investment for the year reached $59.1 billion, marking the highest amount deployed since 2000 and the second highest on record. Venture capital-backed companies employ 38 percent of the U.S. workforce within public U.S. companies and account for 82 percent of private sector research and development since 1979. Annually, VC-backed companies have historically generated revenue equal to 21 percent of U.S. GDP. (Source: Stanford University and NVCA)
Private Equity: U.S. private equity firms invested more than $486 billion in U.S.-based companies in 2014. The private equity industry in the United States comprises nearly 3,847 investment firms, operating U.S.-based businesses in all 50 states. Companies backed by U.S. private equity firms employ 11.3 million people in the United States and 19.6 million people worldwide. In 2014, business services and consumer-related businesses attracted the majority of U.S. private equity investment. (Source: PEGCC)
Real Estate Potentials In USA
36 percent of the US population is 107.6 million people. 42.4 million household live in a rented house/apartment. 51 percent of the 107.6 million population is under 30 years of age. There is a housing potential for about 55 million people.
New housing projects in the United States have had the highest level of the last 8 years in 2016. According to the Fitch Ratings statement, 4.5 percent rise is expected in housing prices in the US this year.
Chinese buyers spent more than $17 billion on US commercial real estate between 2010 and 2015, and during that same period most Chinese real estate investment — at least $93 billion— went into US homes, according to a study by the Asia Society.
According to FDIC data, there are 6085 banks in USA. The total volume of mortgage loans in the United States has reached $10.2 trillion. 52% of the assets have been in the mortgage pools, 37% in banks, the rest has been in other financial institutions’ assets.
After the mortgage crisis in the US, half of the real estate that was sold passed into the hands of banks and financial institutions. The bursting of the property bubble has become an opportunity for foreign investors in recent years.
In the US, the world’s most attractive real estate market, after the mortgage crisis, real estate prices in the US real estate market fell in 70, 80 percent levels in some areas. US real estate market today is highly liquid and will continue in this way in the next 4-5 years as well.
As a result of the Fed’s muscular interventions, the average interest rate in the U.S. for a 30-year-mortgage dropped from 6.08 percent in mid-2008 to 3.68 percent on March 16.
And the reason for the decline in property values in the United States stems from the housing stock accumulated in the hands of the banks that issued credit in high values before.
Today, there are two very important advantages for real estate investments in the US. First, properties that are left in the hands of the banks are going to be purchased.
The second advantage is that a tenant is guaranteed for the estate purchased.
And the high risk of American economy’s exposure to high inflation in the coming years is also an indication for the rent increase.
Real estate investments in the US can pay off for itself in 8-10 years leaving aside all taxes. Lease management costs of the estate are also included. It takes 20-25 years in other countries…
In this sense, the US, compared to other countries, is 2 times more advantageous. There is the opportunity to invest in real estate income with a return of 100% a year.
The safest country in the world to purchase real estate is USA. Assurance comes from the system of property law and the government. The system has obstructed the slightest misconduct there may be.
Advances to be paid (deposit) are held in the escrow (deposit) accounts and only when the land title, insurance operations are finished will be paid to the landlord, bank or contractor.