Despite a growing interest in Asia, U.S. real estate, by a wide margin, has risen to the top of the global property market among foreign investors, with New York City and Washington named the top two global cities for foreign investors' real estate dollars according to the results of the 16th annual survey released today by the Association of Foreign Investors in Real Estate (AFIRE). The survey was conducted in the fourth quarter 2007 among the association's nearly 200 members. Collectively, AFIRE members hold $700 billion of cross-border real estate, including $230 billion in the U.S. The survey was conducted by The James A. Graaskamp Center for Real Estate, University of Wisconsin - Madison.
"The ascension of NY and Washington, DC as the two top global cities (with London tied for second place) represents a very strong showing for U.S. real estate," said Karin Shewer, principal, Real Estate Capital Partners, and the new chairman of AFIRE. "It is the only time since the global city category was added to our survey that U.S. cities have taken first and second spots."
"One of the significant findings that cannot be overlooked is the jump in investors' confidence in China," added James A. Fetgatter, chief executive, AFIRE. "For the second time in three years, China has been voted as the country offering the second best chance for capital appreciation after the U.S. Even more significant is that the gap between the U.S. and China has narrowed from 27 percentage points in 2005 to fewer than five percentage points in 2007. In addition, five of the respondents' top ten global cities are in Asia."
Countries Offering the Best Opportunity for Capital Appreciation 1. U.S. maintains ranking; increases percentage of votes to 26.2% from 23% in 2006. 2. China moves into 2nd place from 3rd; increases percentage of votes to 21.4% from 14.8% in 2006. 3. India falls from 2nd to 3rd; decreases percentage of votes from 18% to 16.7% in 2006. 4. Russia moves from 5th to 4th; although percentage of votes decreases to 7.1% from 8.2% in 2006. 4. Mexico moves from 7th to 4th (tied with Russia); increases percentage of votes to 7.1% from 4.9% in 2006.
Within the U.S. property market, the most dramatic change was a total reversal of investors' preferred U.S. property types, with every property category shifting and, most dramatically, office properties falling into fifth place and retail properties rising to first. The resilience of the U.S. real estate market among seasoned international investors is underscored by the timing of the survey, conducted during the fourth quarter of 2007, after the much-publicized credit crunch and sub-prime mortgage crisis. While U.S. real estate continues to hold sway over real estate in other countries, its dominance is being challenged by other global opportunities.
Source: AllHeadlineNews.com