Could foreign government officials purposely be crushing their own housing markets, and if so, what does this mean for real estate investing in the U.S.?
All it takes is a quick glimpse at global real estate news headlines to discover that many foreign governments are turning off international real estate investors through a variety of factors. There are some in the pit of financial catastrophe like Cyprus and Spain, but what is more startling may be those intentionally raising property taxes, slashing access to mortgages, and demanding their banks raise interest rates to discourage borrowing.
The argument behind these actions stems from a reported fear of housing bubbles in these countries, and can be seen from Malaysia to France, Switzerland, the UK and Canada. Of course no one wants to see their country go through another housing crisis, but it doesn’t take a genius to figure out many of these foreign governments’ moves simply replicate the fatal mistakes that caused the bubble to burst here 7 years ago.
On the bright side, this means many billions of global investment dollars are up in the air and looking for a good home. Some seek higher yields on their investments, but many will settle for fairly modest returns in exchange for the assurance of wealth preservation.
Right now U.S. housing stands out as the best real estate investing bet on the planet, and this combination of factors makes it far easier for American-based investors flipping houses and attempting to raise additional capital.
Add a plethora of distressed and discounted properties still available together with rapidly rising home prices, and we are in a sweet spot for real estate investing we’ve likely never seen. So don’t let it pass you by; welcome those funds, put them to work, and crank up the volume.