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Investors More Apt to Buy in Established Property Markets, Trends Suggest - 2 December 2009

Real estate investors are preferring more established markets to emerging ones, according to recent research.

Although the global economy is on the mend, it’s still on shaky ground, real estate experts say, and buying into a property that’s simply “poised for growth” isn’t wise. It will take time to see a full resurgence in the overseas market, and if only a few buyers are investing in these “growing” areas, prices won’t likely increase and could instead plummet.

Property experts advise that investors play it safe and look into markets with good track records, ones where prices are still relatively cheap. Evidence of conservative investment can be found in the recent wave of buyers in big cities and coastal towns, especially in popular real estate markets like Turkey and Spain.

Although investors are still looking for deals and properties below market value, the majority of recent buyers are wealthy, untouched by the harsh economy, experts say. Many have bought with cash and are looking for long-term investments, not just holiday homes.

But investors on any budget should do their homework, they advise. Although property may be cheap in underdeveloped countries, their infrastructures may hinder the real estate market from any growth, and even depreciate values. Potential buyers should weigh the stability of an invested country’s government and economy and look at impeding developments, like new freeways, airports, town centers, business hubs and resorts.

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