The majority of commentary that one reads in the press nowadays relating to where in the world we should be, or actually are buying investment property is supplied by real estate companies, developers or government agencies in a particular nation where the commentator in question has vested interests.
It is very difficult to find an unbiased opinion about where real estate experts see property potential abroad – and yet that is what would-be investors really want. They want inspiration and ideas, advice and information about the nations that offer long-term potential for growth.
Therefore, imagine how happy we all are that the US born billionaire and real estate entrepreneur Sam Zell has announced where he feels that there is very real potential for very real growth and opportunity for property investors specifically interested in overseas property markets. Of additional interest is the fact that he has also laid out the countries where he feels there is a higher than acceptable level of risk.
Possibly Zell’s number one nation is Brazil – he sees this country as offering the most impressive, broadest and most exciting opportunity over the longer-term, and he cites the reasons supporting his foundation of belief in Brazil. In the first instance Zell mentions the fact that Brazil is already self-sufficient, it has unlimited resources, a massive pool of workers and local talent and is advancing, economically speaking, at an impressive rate. Zell’s company, Equity Group Investments has retail property assets in Brazil that have seen up to 12% annual growth, and Zell is quoted as saying: “if you look at all of the facts, I don’t think there is a better environment in all the world than Brazil.”
Property investors are already looking at the jet to let market in Brazil, but because of housing shortages, the requirement for infrastructure and the appetite for growth that exists almost countrywide, this is a country that is scalable in terms of property investment potential. For would-be investors, look at where there is governmental support of investment in the form of a commitment to improving local amenities, accessibility and infrastructure for example.
Another nation that’s already a favourite with Britons seeking an investment property abroad or even a holiday home in the sun is Egypt. Zell doesn’t specifically touch upon the holiday home market, but he does comment on the fact that Egypt has a housing shortage and that the stability of the nation means that again, there is an appetite for investment because local commitment is there. The fundamentals supporting Brazil and Egypt are similar – and for Zell this makes both nations of maximum interest. This is good news for small-scale investors seeking a pocket of opportunity at what is an otherwise difficult time. Of course, just because Zell is keen on a market opportunity, that doesn’t mean we should all jump on the same train as him – especially as he is a corporate, large scale investor! But it is nice to know that one of the most influential and successful real estate investors of all time sees countries such as Brazil and Egypt as offering very real potential for strong and solid returns over the longer-term.
Two other nations where Sam Zell sees opportunity are Mexico and China – but he is very reluctant to commit in countries such as Turkey where he sees a lack of consistency in governance as being a potential problem, and where we get the feeling he is implying that the government and local nation could turn against foreign buyers at any time. Russia, India and Japan are other nations to steer well clear of according to Sam Zell. Overall his findings and opinions, as reported on Reuters, make absolute sense – he states that until confidence returns to our own domestic market in the UK and that in the US there will be nothing positive to come from the property markets therein. We couldn’t agree more!