If you can past dated images of drug trafficking and corrupt governments, Colombia should be on your watch list. Much of the new construction is driven by government reforms aimed at improving housing conditions for all citizens, but outside institutional investors are also funding projects in Colombia’s major real estate market.
The government is also incenting home purchasing by offering rent-to-own program and other creative financing fuelled by local and international banks eager to lend with government backed security.
With annual real property value growth rates nearing 10 percent, Taiwan is also a strong contender for real estate investment. However, this market appears headed for the same overdevelopment mistakes made by Dubai and some parts of China.
Adding to the confusion is the heavy percentage of investment in real estate projects by local life insurance companies looking for higher than average returns on low interest rates and the government’s apparent “referee” status between the constructors, the funders and the buyers.
Also boasting near-double digit investment returns, China continues a long trend as a hot real estate market. The Chinese government’s 5 year plan to balance the national economy appears to be working with results including lower inflation and less available new construction.
China has also relaxed its rules about family size, allowing families to produce more children, which will drive demand on a long term investment.
Most researchers agree than China has survived its own economic crisis and appears ready to surge forward once again.
Even as it works towards European Union membership, Turkey has already enjoyed a multi-year real estate value increase. By allowing foreign real estate ownership and longer tourist visas for property owners while avoiding the Europe’s financial meltdown and political unrest in the neighbouring Middle East, Turkey has seen a huge increase in institutional and individual property investment. A thriving middle class adds fuel to real estate prices and you can’t travel far in any Turkish city without seeing large and small construction projects.
Although India’s real estate value increases were slightly less robust than some other markets, it is still a hot market. Makaan, India’s largest real estate website, conducted a detailed study on the Indian market. According to the study, internal and external institutional investors have largely driven India’s solid real estate value growth, but that is expected to change next year with individual home buyers leading the pack.
As the lone European nation on the list, Austria enjoyed a 10 percent value increase in the last 12 months. There are several indicators that appear to support a continued positive trend in the Austrian real estate market.
First, Austria avoided the full effects of the European Union’s financial problems. Because Austria did not bet investment dollars as heavily as other European nations on the disastrous American subprime real estate investment vehicles, Austria’s economic dip was limited to the effects of reduced exports.
Additionally, local demand and lower interest rates will continue to fuel commercial and residential real estate price increases.
Austria’s lone limitation will be its economic dependence on exports, meaning that it will continue to be susceptible to the problems of its export partners.
Hong Kong could easily be called King Kong in the real estate investing sphere. The last twelve months saw a real estate value increase of over 20%. The only real question for investors is how long Hong Kong can maintain its growth rate with limited undeveloped space and a less than diverse economy.
What is concerning is that market analysts don’t seem to have a consensus on the Hong Kong market. Some believe real estate values are inflated and overdue for a downward adjustment. At the same time, other analysts believe that domestic demand and limited available space will continue to drive growth rates.
Brazil’s large cities continue to be an excellent location for your real estate dollars. The Brazilian economy has been running hot for several years and the Olympic Games and World Cup can only help values for the foreseeable future.
However, there are fears that the Brazil real estate market is a bubble waiting to burst. These fears are largely fuelled by warnings of impending collapse from Robert Shiller. You’ll remember that Shiller correctly predicted the United States real estate market collapse.
Most market analysts seem to agree that investment in Brazil should be short-term and that investors will need to look for bargains outside the major cities. Everyone seems to agree that the market will continue to grow, but that the double digit returns have already passed.
Moscow, in particular, continues to see real estate value increases over 10 percent, but the overall weak Russian economy may cool demand in coming years, despite the coming Winter Olympic Games.
Investors will need to look beyond obvious opportunities and always be mindful of the Russian government’s effect on data reporting and marketing.
Finally, despite a brief flattening in real estate values due largely to overdevelopment, Dubai is once again heated up, seeing an almost 20 percent rise in 2012.
Dubai will benefit from the Middle East’s regional instability as investors avoid Syria, Lebanon and other nations with obvious problems. According to Fitch Ratings, Dubai will also continue to benefit from a strong tourist market, controlled domestic development and expanded investment from current individual and institutional investors.
So, for the individual or institutional real estate investor, there are many investment opportunities available in 2014. Some areas should see investment with an overabundance of caution. Some should also be viewed as short term investments, but these markets should all see positive growth in the next 12 months.
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