Foreign Real Estate Investors Not Dissuaded by Interest Rates

By
Real Estate Broker/Owner with The Celtic Connection Realty BR545869000

Foreign investors continue to view U.S. real estate as a sound investment, with an astounding 95 percent of those recently surveyed by the Association of Foreign Investors in Real Estate (AFIRE) reporting they plan to “maintain or increase their investment” in 2017. U.S. real estate was ranked No. 1 by respondents for both security and stability, as well as opportunity for capital appreciation.

Foreign investors’ perceptions of U.S. real estate, with the incoming administration and rising interest rates, are overwhelmingly positive: 60 percent of survey respondents reported an unchanged opinion about the market from last year, citing its stability and security. The top five cities for real estate investment this year, according to the survey, are New York, N.Y., Los Angeles, Calif., Boston, Mass., Seattle, Wash., and San Francisco, Calif. 2017 marks New York’s seventh year at the top of the list.

Washington, D.C., notably, slipped from the top five for the first time since 1992—a misleading move, according to Catherine Pfeiffenberger, AFIRE chairman.

“Washington, D.C. is a global gateway city with good leasing activity and a growing economy bolstered by a young workforce,” says Pfeiffenberger. “The combination of those stable fundamentals will continue to attract capital from around the world. The new administration’s focus on the defense and aerospace industries is also expected to benefit the D.C. area in the coming years.”

Investment opportunity in U.S. real estate has widened, according to the survey, with industrial properties moving ahead of multifamily properties as the No. 1 investment type. Multifamily, office, retail and hotel round out the top five. The shift has strengthened foreign investors’ confidence in emerging markets, such as Charlotte, N.C. and Nashville, Tenn.

Fifty percent of respondents, in addition, believe Brexit will be beneficial for U.S. real estate. (London fell to the No. 3 spot globally in the survey, as a result.) The most secure and stable countries this year behind the U.S., according to respondents, are Germany, Canada, Australia and the U.K; the countries with the best opportunities for capital appreciation are Brazil, Germany, the U.K. and Australia.

mpending economic and political changes in the U.S., still, have given some foreign investors pause, the survey shows—a cue for real estate professionals to offer comprehensive data to their investor clients.

“As uncertainty rises with a new government in Washington and interest rates that have risen dramatically, it is no surprise that investors have signaled a note of caution,” says James A. Fetgatter, CEO of AFIRE. “Previous, comfortable spreads between cap rates and interest rates have narrowed, making the investment criteria more selective and difficult. Increased market research and discipline will be required.”

Source: Association of Foreign Investors in Real Estate (AFIRE)

Ed and Celia Maddox

Ed and Celia Maddox

The Celtic Connection Team

Solutions Real Estate

Edward Maddox, Associate Broker, MRE, GRI, ABR

The Celtic Connection Realty Team - We Take the High Road

Solutions Real Estate - Multi-Million Dollar Producers 2004-2016

Direct: 480-987-9322  Cell: 480-612-7968  Fax: 800-410-9607

To search for homes go to our web sites:

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Contact us to set up search for any other areas of Phoenix AZ

 

A FEW OF OUR TESTIMONIALS (Additional ones upon request)

 

Nicole Marr

Celia and Ed Maddox were wonderful to work with. They were extremely patient with me and very flexible with showing houses. It's nice to work with a husband and wife team because it really is twice the service! They complement one another nicely and both bring different perspectives to the table so you get very well rounded views and opinions from them both. I plan on staying in my home for many years, but if I ever do buy or sell again in the future I will definitely use Ed and Celia!

 

Ron and Ellen Littlejohn

Thanks so much for all your help with the purchase of our new hom

 

 

 

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Edward and Celia Maddox, Associate Broker, MRE, GRI, ABR
The Celtic Connection Realty - We Take the High Road
Solutions Real Estate - Multi-Million Dollar Producers 2004-2011
Direct: 480-987-9322 Cell: 480-612-7968
Fax: 800-410-9607

 

 

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Rainmaker
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Susan Jacobsen
The Alliance Group Realty - Hilton Head Island, SC
20 Years Providing WOW Real Estate Service

Hi guys - what you're saying was exactly what was presented at the NAR Convention by two Realtors(R) from Florida who do quite a bit of work with foreign investors and foreign second home buyers. In our area, we don't really have that customer/client. We do have some Canadian buyers but they have dramatically moved from our market to the FL market. Keeping track of the global market is still very helpful. Best of luck to you in the new year!

Jan 08, 2017 11:54 AM #1
Rainmaker
3,522,533
Joan Cox
Metro Brokers - House to Home, Inc. - Denver Real Estate - 720-231-6373 - Denver, CO
Denver Real Estate - Selling One Home at a Time

We have many foreign buyers in our area, and most are cash.   Our home values are increasing from 9-10% per year right now, which is much better than you can get elsewhere for your investments.

Jan 08, 2017 12:09 PM #2
Rainmaker
1,282,180
Edward & Celia Maddox
The Celtic Connection Realty - Queen Creek, AZ
EXPERIENCE & INTEGRITY - WE TAKE THE HIGH ROAD

Thanks for the comments.

Jan 09, 2017 01:46 PM #3
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Rainmaker
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Edward & Celia Maddox

EXPERIENCE & INTEGRITY - WE TAKE THE HIGH ROAD
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