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Distressed Property on the Rise in High Demand Markets Abroad - 27 November 2009

Around the globe, a majority of popular real estate markets saw a dramatic rise in distressed property sales this year, according to a recent survey.

South Africa, U.S., Portugal and France reported the highest increase of foreclosed property out of the 25 countries surveyed by the Royal Institute of Chartered Surveyors (RICS). China, Hong Kong and Brazil were among the 20 percent surveyed that cited a decline.

Real estate experts believe that high numbers of distressed properties will continue to hit the market in 2010, as banks manage the number of property loans that have yet to be worked through their system. In the U.S., foreclosures made up 30 percent of property sales in October, despite promises that the country’s economy is on the upswing. Russia, Ireland and Spain are also predicted to close out the year with a high number of properties listed below market value.

In Europe, Spain continues to garner attention among overseas buyers looking to make high returns on rental property. While foreign investors often come from the U.K. and Russia, stronger economies like the Netherlands, Denmark and Norway are also snatching up Spanish property.

Experts note that Abu Dhabi, Qatar and Kuwait are countries to watch for distressed properties in the Middle East, due to their low supply of rental units. More traditionally popular countries like Dubai and Bahrain may have high numbers of distressed properties for sale, but their exposure to real estate and financial services may eventually cause prolonged price stagnation, experts warn.

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