Top 10 property investment opportunities and the countries to invest

Top 10 property investment opportunities and the countries to invest

It is the annual list overseas property buyers need to see before making property investment decisions. Stuart Law selects a list of old favourites, emerging nations and outside bets.

Much of the world has seen a significant setback in pricing and demand over the last two years. Do the price reductions offer an investment opportunity for a particular country? Or do they just put prices back at a fair level? Has the country suffered harshly? Or was it in a bubble? And how quickly will these countries recover?

	Property in France Distressed sales for French ski chalets could bring great returns over the next few years as the tourism market recovers. There are still some very affordable ski pads in the French Alps, and it will always be viewed as a desirable ski holiday destination. Our Gallic neighbour has not completely escaped the credit crunch, but the market for French property does remain robust. However two seasons of poor rental bookings have created some distressed sales that will produce excellent yields once the market recovers
	Property in USA Florida is an old favourite and the economic turmoil has led to many property bargains, with up to 75 percent off the peak price. Florida has large numbers of distressed property, from private sellers, developers with finished but unsold stock and the banks holding repossessed units. The product is not simply poor quality leftovers, but quality stock in excellent resorts. Tourist demand for rentals remains reasonable but suppressed in the short term. Letting of resort property to locals is probably the best short-term strategy.
	Property in Cyprus Cyprus had a remarkable three-year housing boom which peaked in November 2008, although warning signs were there two years before. The house price crunch was mainly due to lower demand from British buyers - around 70% of the foreign market. The economic recession and the weakening of the British pound against the euro resulted in sharply lower demand for houses. There are some new build bargains to be had at up to 50 percent off the original prices. Resale property has been marked down to protect banks’ exposure.
	Property in Germany Germany remains the world’s most stable housing market. Prices moved little in 2008, despite the slumping local and global economy. The main cities in Germany have had a drop in prices of just 10-15 percent and rental yields of 7-10 percent in Berlin and 8 to 15 percent in many other German cities are common. Certainly a safe and income generating investment for investors, with uncommonly high yields for a dominant European country.

Emerging Markets

	Property in Dubai After six years of an extravagant boom that was also a bubble, most residential property prices in the UAE have fallen sharply. Property prices in Dubai have dropped as much as 70 percent. But the local economy is expected to recover, as the country's master plan gets back into gear. A good opportunity to buy property in Dubai, with prices across the Emirates expected to see short-term falls. Locals are already stepping back in to purchase finished property in good quality communities, whilst avoiding building sites.
	Property in Brazil A big investment opportunity as the country prepares to host the 2016 Olympics and popular places to buy include Rio de Janeiro and Sao Paulo and beach resorts such as Natal. Demand for property ownership and rental in Brazil is huge, in particular from the US. With 50 percent of the population under 25, Brazil boasts one of the youngest populations of the emerging nations. Brazilian real estate offers buyers a strong buy-to-let opportunity and impressive capital growth potential, with average yields of around 6.5% percent.
	Property in Cape Verde Demand for tourist rentals remains strong, with short flight times from Europe and outstanding beaches. Some of the new five-star hotels and resorts are completely full and the credit crunch has really slowed down development on the islands. Prices are still low, in the region of £50,000 for a two-bedroom holiday apartment, half the price of the Canaries. The year-round sunny climate means strong rental returns, with only the relatively windy and warm, but wet, July and August preventing the possibility of 52-week holiday lets in the sun. Worth a punt!
	Property in Malaysia The growth in house prices has slowed in Malaysia, but property prices are still inching up. There is a slight oversupply of mid-price to luxury condominiums, especially in Kuala Lumpur, the capital, though these still offer some of the highest returns around the world, with average yields over nine percent. The government has introduced the ‘Malaysia My Second Home’ campaign to promote Malaysian property and has abolished rent controls and eased foreign ownership laws. With a well-controlled legal system this location should be on adventurous investor’s list.
	Property in Iraq Iraq is the new emerging real estate investment market of the Middle East, as security concerns lessen and the government commits itself to major property developments. New residential projects are being announced and the mayor of Baghdad has revealed a five year plan to build 300,000 housing units. It is an ancient investment philosophy to buy assets whilst conflict is still going on, but likely to end in the near future - an investment philosophy that has done wonders for several wealthy European families’ net worth.
	Property in Latvia The Latvian housing market bubble began to burst in 2007, initially as part of the government’s effort to tame inflation and discourage property speculation. Global meltdown devastated Latvia’s economy, leading to possibly the world’s worst house price freefall last year. Riga remains a hotspot - around one-third of Latvia’s 2.5 million population lives in the capital. Riga has plenty of distressed property and for those long-term investors could offer excellent returns. At some point good quality property in Riga will be worth the same as prime central Manchester.