The U.S. property market is set to benefit from a continual rise in property investment during 2016. The info comes from a survey by the Association of Foreign Investors in Real Estate – also known as AFIRE.
Around 100 members of the group, responded to the survey, and it revealed some interesting information. Almost two-thirds said they would make a ‘modest or major’ increase in their investments. Meanwhile, a further third said they would be reinvesting proceeds of sales in the United States into new assets.
The expected rise is a continuation of foreign investment that has been happening since the financial crisis in 2009. Before then, there were only around $9 billion in property deals. That figure has jumped to $87.3 billion, according to Bloomberg Business. Investment has come from all four corners of the globe, including as far afield as Australia.
There is also strong evidence that China is still investing in America, despite its recent financial woes. During 2015, the Chinese investors bought a whopping $8.6 billion worth of American commercial real estate. All of those investments are already there, too – and the figure does not include developments.
But where, exactly, is the focus of the property investors attention? New York is the most popular city in the world to invest in, outstripping other popular cities such as London and Berlin. However, San Francisco is also high up on the list of desirable U.S. cities.
And the types of property that are of interest are a mixed bag, too. While not all foreign investors end up moving here, residential options are still a key attraction. And, with plenty of property management companies looking after all the arrangements, they don’t need to be here at all. Business premises are a popular choice, too. Hotels, shipping yards, office blocks and warehouses are all being snapped up by foreign buyer.
The property investment market will get a further boost this year, thanks to recent government legislation. The bill will help ease taxes for foreign pension funds who aim to buy properties in the States – and it’s sure to attract even more attention.
It’s an interesting development, although the news may not be greeted with such joy by anti-immigration lobbies. Just a couple of years ago, reports suggested foreigners were using their properties to improve their claims of a green card.
Plus, the report doesn’t reveal anything about the entirety of the U.S. property market. There are always popular cities, of course – New York is always a big attraction for anyone in the world. And, while major cities such as San Diego are currently booming, that’s not the case for everywhere.
It will be a case of wait and see for the moment – especially when you consider the Chinese economy. Nobody can tell what will occur in the next few months, let alone the whole of 2016. And, with China investing a large chunk of the foreign real estate figures up until now, it remains to be seen whether they can continue.