The Association of Foreign Investors in Real Estate (AFIRE) recently released the results of its most recent survey. 95% of the respondents plan on either maintaining or increasing their level of investment in the U.S. real estate market. The positive feelings persisted with investors even when asked about the changes in the market including the incoming administration and rising interest rates. 60% of the respondents reported no change in their views of the U.S. real estate market from last year.
The AFIRE report also listed the top five U.S. cities for real estate investment this year:
- New York
- Los Angeles
- San Francisco
Many cities outside of the top five have also been drawing a lot of investor interest.
What Investors Like About U.S. Real Estate
There are a number of factors that make the U. S. real estate market attractive to foreign investors. Respondents from the AFIRE survey indicated that they felt the U.S. offered great stability, security, and opportunities for capital appreciation.
Many experts also noted that Brexit will most likely benefit the U.S. real estate market as the British economic uncertainty will drive investors towards the more stable U.S. market.
This year investors are also investing in a broader class of properties. Industrial real estate moved ahead of multi-family real estate investments, though multi-family investments remained strong.
Note of Caution
While the report was mostly good news for the U.S. real estate market, some investors in the AFIRE did express some cautions about the upcoming political and economic changes in the U.S. There is some uncertainty about how the new administration will treat foreign real estate investment. The biggest concern was the future of interest rates. Experts expect the Federal Reserve to raise interest rates to keep inflation in check. However, there is some question about how quickly rates will go up and what effect that will have on the real estate market.
However, even with these worries, overall foreign investors remain enthusiastic about the U.S. real estate market in 2017. It seems likely that as the new administration gets settled and as the Federal Reserve makes its future plans clearer, the market will adjust, and the uncertainty holding back some foreign investors will evaporate.
Please see our Market Reports for a complete city by city analysis on the Marin County real estate market.
A Top Producing Agent for 2015 & 2016
Decker Bullock Sotheby’s International Realty
100 Tiburon Blvd, Mill Valley, CA.94941
Marin County Real Estate Report