Despite the intense negative press, the U.S. Real Estate Market still makes a lot more sense and holds more potential than real estate markets in most of the rest of the world. The media tends to dwell on the subprime crisis and its effect on the housing market however keep in mind that despite the risk of foreclosure in the country’s poorer neighborhoods, much of the market is still continuing with small but persistent appreciation rates. American real estate is much more stable and consistent than say, real estate in Malaysia.
Here are some reasons why overseas investors think U.S. commercial and residential real estate is attractive:
1) Transactions in the US are less risky than in closed, opaque real estate markets like China:
- The United States has the most transparent and liquid real estate market – Cushman Wakefield
2) Upward trend of foreign real estate investment into the US
- CB Richard Ellis predicts global real estate set to soar
- Global real estate transactions hit $600 billion (up 150% over 2004) – July 23, MENAFN Arab News
- NAR research report on foreign direct investment in US real estate, 2006
3) Prime US markets are looking cheap by global standards
- Dollar is crashing making US real estate cheap in the eyes of Europeans and Asians
- New York falls to 27th most expensive city in the world – Jan. 2006, Money CNN – and this is before the dollar crashed 15% vis-a-vis the Euro between January 2006 and today.
- Interest rates have been heading lower once again in anticipation that the subprime crisis will impact the US housing markets –
