Should You Invest?
Guam is the sophisticated destination of Micronesia thanks to
increased tourism and a construction boom that is sweeping the
country. As a result, property prices are rising. Buying property
in Guam is relatively straightforward as there aren't many
restrictions on foreign ownership.
- Guam is experiencing high rental yields of up to 14%
- Rental income tax is low and non-resident foreigners earning
rental income are only taxed at corporate tax rates.
- The transaction costs for buying and selling property in Guam
are low at only 6.6% - 12.6% of the property value.
- The tenancy laws in Guam are pro-landlord.
- The island is known for its good weather with an average
temperature of 25-30°C all year round.
- The country is based on the US dollar and economy, thus will be
experiencing the current economic downturn seen in the states, but
will recover in line with the United States.
Rental Yields
Rental yields in Guam are currently high at around 14%. Prices
for residential property are currently around US$1,100 to US$1,450
per metre. A 220 metre residential house costs around US$250,000
with an average monthly rent at US$3,000, which has a yield of 14%.
An 80 metre property costs an average of US$100,000 to buy and
with an average monthly rent of US$700 has an average yield of
8.40%.
Price History
Guam's economy was historically sustained by the thriving
Japanese tourist market, but following the Japanese recession and a
succession of other damaging international events, Guam's economy
floundered and real estate prices dropped as economic growth
slowed. The US Marine Corps agreed with Japanese officials in 2005
to move a USMC base from Okinawa to Guam, with completion of the
move planned for 2014. The 7,000 marines and approximately 10,000
dependents will force a signifianct amelioration of existing
infrastructure and other facilities. The housing market will also
be bolstered as demand shoots up. According to
globalpropertyguide.com the median price for a house in 2006 was
$155,500.
As Guam utilises the US dollar it will be experiencing the price
drops seen across the Pacific Ocean in the United States.
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