Many Americans can’t afford to invest in the real estate market. But foreign investors can and see U.S. apartments, houses, hotels, shopping centers, warehouses and offices as good investments, according to a new survey.
The weak dollar has made the American real estate market look attractive to foreign bargain hunters.
The U.S. rose to the top of lists of the “most stable and secure” countries for real estate investment and the countries with the best opportunity for appreciation, according to the 16th annual survey of the Association of Foreign Investors in Real Estate (AFIRE)released Jan. 28. Florida and New-York were the top two global “States for Foreign Investors’ Real Estate Dollars,” according to the survey.
China is also growing in popularity. Shanghai rose to No. 5 from No. 9 a year ago on the list of top cities for foreign investment. And China is now No. 2 on the list of countries with the best opportunity for appreciation.
The survey of 200 AFIRE members was conducted in the fourth quarter 20010. AFIRE members hold $700 billion of cross-border real estate, including $230 billion in the U.S.
Here are the survey results:
Most Stable and Secure Countries for Real Estate Investments
1. U.S. – 56% of vote
2. Germany – 11% of vote; up from #3, with 4.5% of the vote in 2006
3. United Kingdom – 8.8% of vote; down from #2, with 11% of the vote in 2006
4. Australia – 8.8% of vote; up from #5, with 3% of the vote in 2006
5. Japan – 5.3% of vote; with 3% of the vote [tied with Australia], unchanged from 2006
Appetite and Opportunity: U.S. comes 1st
- On average, survey respondents say that slightly more than 50% of their real estate planned acquisitions in 2011 will be allocated to the U.S. While the percentage allocated to the U.S. remains roughly the same as 2010, the actual dollar amount is expected to increase by 16%.
- Eighty-five percent of survey respondents say that recent fluctuations in the dollar have not prompted them to increase their U.S. allocation.
- The percentage of respondents saying it was “very difficult” to find attractive U.S. real estate fell to 22.8% from 37.5% in 2006. This represents the smallest percentage expressing this sentiment since 2003.
- For the first time since 2004, a measurable number of investors declared investing in the U.S. to be “somewhat easy.”
- For the first time in years “distressed assets” are mentioned by AFIRE members as a new strategic focus.
Source: Business Week