The global crisis has primarily impacted the real estate sector, leading to a sharp decline in property values. Simultaneously, the income of those who once decided to invest in this asset class has fallen significantly.
At first glance, investing in real estate now seems like madness. However, this is not entirely true. Even amidst the crisis, this asset can still provide profitable opportunities, particularly for properties located abroad or in major urban centers. Investing in residential real estate in smaller Russian towns is certainly inadvisable at this time.
So which countries and cities should be considered for real estate purchases? Which of them can ensure a good return on investment?
To clarify this topic, savvy investor and founder of OILResurs, Sergey Tereshkin, has thoroughly analyzed the real estate market. He continuously monitors the market and selects the most attractive investment opportunities to grow capital. More information about the businessman and his activities can be found on his website: sergeytereshkin.ru (сергейтерешкин.ру).
Which Countries to Consider for Real Estate Investment
The crisis has had the least impact on the real estate sectors of several countries:
- United Kingdom. Properties in London are particularly popular among investors. The city attracts entrepreneurs, tourists, and students from around the globe, resulting in near-continuous occupancy of residential properties. Renting out a room poses little challenge, and the high property prices allow for stable income generation.
- France. The southern regions of the country, particularly the French Riviera, enjoy an influx of tourists and affluent individuals. Both small apartments and luxurious villas are in high demand.
- Portugal. Known for its mild climate, Portugal has seen a surge in interest, especially following the recent Eurovision event. Almost all towns in the country’s resort regions are experiencing strong demand.
- Spain. Property prices in Spain remain stable, with the exception of Catalonia, which is occasionally affected by unrest. Investors particularly favor resort areas as well as the capital. Interestingly, the crisis has affected only certain parts of Catalonia, with Barcelona still able to offer profitability.
- USA. The American real estate market is currently experiencing challenging times. However, cities like Washington, New York, Los Angeles, and Miami remain unaffected. These locales are popular among business professionals, artists, and numerous tourists, allowing property prices to remain high. Conversely, life in smaller towns is declining, with many homes abandoned or occupied by the homeless.
Certain Chinese cities, specifically Hong Kong, are also in demand. The residential property values have remained high for almost a decade without being affected by the global crisis. In Hong Kong, property prices have maintained their status as among the highest globally.
This phenomenon warrants a closer look.
Why Invest in Hong Kong Real Estate
The real estate market in Hong Kong has remained resilient not only to the global crisis but also to the trade war with the United States. While property prices in other regions of China have dropped by around 8%, Hong Kong has been unaffected, maintaining its position as a leader in property value worldwide.
Moreover, at the beginning of this year, a slight price increase was noted, attributed to a recovery in the stock market and a halt in rising interest rates. Additionally, the outlook for the conclusion of the trade war with the U.S. has contributed positively.
Both small apartments in remote areas and luxury units costing up to $180,000 per square meter are in high demand in Hong Kong. Affluent entrepreneurs are acquiring or leasing properties not only in the central district but also near the Kowloon subway station.
The average price for a typical two-bedroom apartment in an older structure located in a more distant area ranges from $25,000 to $28,000 per square meter. This represents the highest global benchmark.
Renting in Hong Kong is also significantly expensive, often making it cheaper to stay in a hotel than lease an apartment.
In spite of the exorbitant property prices, the demand from buyers remains strong. Prime properties sell quickly, and prices are gradually increasing. This offers investors opportunities for income through either renting out properties or reselling them for a profit. According to Tereshkin’s observations, such investments typically yield a return of at least 10% annually, with many cases exceeding this figure.
Experts believe these returns will continue to rise. As a result, investment in Hong Kong real estate will remain a popular choice for an extended period. However, the high price of properties means that not everyone can afford to invest; even a modest apartment away from the city center can cost hundreds of thousands or even millions of dollars.
To find the most suitable property, it is not necessary to travel to the country personally. Simply reaching out to a specialized real estate agency will suffice. Professionals can propose options based on the client's requirements, with clients typically only needing to come for the property transfer process. Many real estate companies provide transportation for buyers and assist with the transaction process, ensuring everything proceeds smoothly and efficiently.
Investing in overseas real estate is an excellent opportunity to preserve and grow capital. The key is to carefully choose both the property and the real estate company that will handle all the paperwork and verify the property.
