Justin Fontenelle, founder of JustInvestNow, a specialized company, is the guest of Ariane Artinian at the microphone of Mysweetimmo.
My Immo Podcast is flying across the Atlantic today to take an interest in American real estate and the consequences of the coronavirus crisis on the sector. How are professionals and clients weathering this earthquake? Can we still (and should we still) invest in Uncle Sam’s country? Justin fontenelle, founder of JustInvestNow, a company specializing in real estate investment in Detroit and mainly dedicated to a French-speaking clientele, enlightens us on the American situation at Ariane Artinian’s microphone. Selected extracts.
The Covid-19 crisis in the United States
“Even though the country reacted with delay, we have all been on lockdown for 4 weeks. Now they also want to reopen everything as quickly as possible, while avoiding a second wave of the virus. “
State aid
“What is good is that the state helps all the small businesses and employees who have had to be made redundant a lot. This involves “Stimulus Checks”, checks between 1,200 and 3,000 dollars, bonuses and unemployment for some. All of these aids allow us to always be able to collect rents from our customers. We haven’t had a drop in rent collection so far. “
Customers who continue to invest
“We are continuing our activity: reservations, purchases, sales… We have sold between 5 and 10 houses since March 15, whereas we usually sell between 10 and 15. To attract new customers, it is more difficult. But our old customers are still there. Those who know us, who have already bought with us, continue to trust us. They know their investment is safe with us. It is thanks to these former clients who trust us that we can survive. “
Detroit chases crises
“Auto crisis, subprime mortgage crisis… we are used to crises in Detroit. We had a bad image, that of a ghost town. Between 2012 and 2014, a wave of investors arrived but undoubtedly too early and badly advised. However, when you want to invest in Detroit, you have to do it intelligently. Make sure that the property is properly renovated, that there is a serious team to take care of the management, you really have to buy with the right people. This is what we have been implementing since 2014: we want to be infallible for our customers. This is why our clients continue to invest with us despite the coronavirus. “
Investment opportunities in Detroit
“We have assets between $ 40,000 and $ 100,000. Profitability level, we have two types of goods: goods with pure profitability, with higher profitability (beyond 13%) between 40,000 and 60,000 dollars. Then we have premium goods, with a profitability between 10% and 12%, but which have enormous potential for capital gains. For properties located in rapidly developing neighborhoods, this can go very quickly: you can double the value of a property within 5 to 10 years. All the goods we sell are fully renovated and rented. And we provide 1 year warranty on the good. “
No price reduction for the moment
“For the moment we have not seen a drop in prices since the start of the coronavirus crisis. Since the subprime crisis, prices have increased by 12% per year across the city. Of course, if the crisis lasts 6 months, it may be different, but for now, there is no drop in prices. “
Investors with varied profiles
“There is no typical profile. There are young investors who want to get started and diversify their heritage. We have more seasoned people who have already made investments in France or abroad. We have people who make their first investment abroad, which is always a very difficult step to take, because Europeans prefer to buy close to home in order to have control. Our team is here to erase this psychological distance. It is important to reassure our customers. “
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