Top 7 Countries That Invest In U.S. Real Estate
Posted by admin | Real Estate | Posted on August 24th, 2009
Despite the recent slowdown, the U.S. housing market remains a popular investment destination for foreign investors. Attracted by a good return on investment, many foreign countries continue to invest heavily in the U.S. residential and commercial real estate markets. In fact, in 2005, foreign investment in U.S. real estate was 1.83 trillion.
To assess the impact of foreign investment in U.S. property market, the National Association of Realtors (NAR) issued a 2006 report entitled “Foreign Investment in U.S. Real Estate: Current Trends and Historical Perspective.” The report provides detailed information on trends in overseas property investment, its impact on the U.S. economy and the major countries involved in the U.S. real estate investment. Here are some highlights from the NAR report.
According to the U.S. Department of Commerce, the seven countries that have significant collections of real estate in the U.S. from 2005 were:
- Germany – 13%
- Latin America – 13%
- Australia – 11%
- Japan -10%
- United Kingdom – 10%
- Canada – 6%
- Netherlands – 6%
The U.S. economy is open to foreign investors. Both investors and Americans benefit greatly from all this foreign investment. Study of the NAR estimated that without foreign investment in the stock market, long-term lending rates would be four percentage points above the current rate, which negatively affect the U.S. property market.
Foreign direct investment in U.S. not only creates jobs but also contributes to the demand for U.S. real estate. In fact, foreign investment may be responsible for creating two million jobs in U.S. at the end of 2006, which further strengthens the demand for U.S. real estate.
Permanent and temporary immigration of foreign workers in the U.S. further reinforces the demand for real estate. According to the Joint Center for Housing Studies at Harvard University, 1.2 million immigrants are expected to arrive in the United States annually. This pattern is expected immigration to offset the drop in demand for housing by post-baby boom generations.
In summary, the impact of foreign investment and immigration in the U.S. will continue to play an important role in the U.S. property market.