2014 was an exciting year for international property investors and we've seen the market open wider than ever before as we get closer to true globalisation.
It's not just been a year of opportunity for the world's wealthiest either, although most real estate transactions have been in prime residential and commercial markets. There are increasing opportunities for small investors to enter the property investment market using funds, trusts, crowdfunding and other collective investments as vehicles to participate with minimal capital outlay.
Where to invest? How to invest?
In our comprehensive new reports (available via the button below), 'Emerging Trends in the Global Property Market 2015', we take a look at the shift in investor activity we've experienced over the year and apply it to how we see 2015 panning out for property investors.
Major trends emerged in global property markets during 2014:
- The rise of the income-generating asset, now the most popular property investment vehicle in most international markets.
- Increased buying activity in the US, UK and Europe from non-EU investors, particularly in prime residential and commercial markets.
- The increased penetration of the smaller private property investor as markets both domestically and internationally present affordable opportunities
Income-generating property has become the most popular asset class in 2014
The UK will see a significant shift from its prime markets to regional centres, particularly when pension-holders are able to invest lump sums as they wish from April 2015. A surge of interest in income producing property assets is widely anticipated and depending on the outcome of the general election, buyer interest may not be restricted to UK markets.
The most familiar income producing property market is buy-to-let (BTL) although there are increasing options becoming more widely available to smaller investors at an international level, in asset classes already popular in the UK such as:
- Student Accommodation
- Hotel Rooms
- Care Homes
- Social Housing
- Mixed-use residential
Commercial real estate such as office space, hotels, working farms and warehouse space investments is anticipated and depending upon the outcome of the general election, buyer interest may not be restricted to UK markets.
All-in-all we are set for an interesting and extremely busy year in 2015 as property markets across the world adapt to stronger buying interest outside prime residential and commercial sectors.
Domestic buying activity should increase as economic recovery filters down the social scale, stimulating the affordable housing market and opening the doors of opportunity to a greater proportion of people.
If you'd like to read the new reports we've created, click the button below:
IPIN's Singapore office responds to Asia's increased appetite for foreign investment
In 2014, demand in property markets was largely fuelled by the staggering interest coming from non-EU countries, particularly Russia and the Far East. With a strong appetite for prime property in mature markets, prices have been forced upwards and developers have responded by building for this segment of the market – namely, ultra-rich cash-buyers.
At IPIN, we identified the Asian market as being set for expansion into overseas investment arenas during 2013 and have since opened an office in Singapore specifically as a platform to introduce Asian investors to overseas markets.
2015 will see a continuation of the theme of heavy buying by ultra-wealthy Asians although they will increasingly look beyond core markets, seeking better value in regional cities throughout the UK and Europe.
With the dollar gathering momentum against major currencies, the US may see a slowing in foreign buying in its property markets in 2015, as housing price rises and dollar strength reduces purchasing power.
International investment opportunities are more accessible to smaller investors
Property has and will probably always be the most popular tangible asset available. It makes common sense really when you think that every person on the planet needs some form of shelter and while supply might be finite, demand is infinite.
Recessions are historically the breeding ground of the ultra-rich. 'Money goes to money' as the saying goes and that's probably more to do with the natural savviness that comes with being wealthy as it is being privileged enough to grab opportunities as and when they present themselves.
Whereas in the past, property investment was the exclusive domain of the rich, we find ourselves at the start of 2015 on the threshold of a much more level playing field where smaller investors have equal opportunity to make their money work harder for them.
Sourcing high-value opportunities should become less of a challenge for the smaller investor as access to international property improves further in the coming years. Global construction is expected to respond to rising international demand for affordable homes, stimulating growth at the lower price point of the property market.
It's always a good time to invest in real estate, one of the most enduring assets of all time, but as always, much depends on market fundamentals and obviously, investment costs.
We at IPIN have specifically placed ourselves in the investment market to deliver exceptional opportunities which not only represent value but also provide realistic entry levels and secure exit strategies.
Get direct access to the IPIN Members area for the suite of reports using the button below:
- Friday 20 February 2015