According to the Economist, the developed country real estate boom has created more than 30 trillion dollars between 2000 and 2005. This trend has given a lot of people a lot of buying power. Armed with this mountain of equity many investors are looking to diversify their real estate portfolio by turning their attention outside US where property prices are looking more attractive than ever.

Better information over the internet, globalisation, better airline services, a growing tourism and leisure industry are all factors that are supporting this growth in international real estate purchasing. It is not only the adventurous who are taking this step the attraction of cheaper properties and in some cases, warmer climes, is attracting the more docile investor.

“The foreign second homes market will continue to explode in the coming years, this is not a temporary trend” according to Jeff Hornberger, International market Development Manager at the National Association of Realtors quoted in a recent edition of 2nd Home journal. We agree, a slow down in the US market is likely to shift investor attention overseas as they look for better candidates for capital appreciation.

It remains to be seen how severe the slowdown will be. Cheaper international destinations may remain immune. But there may be a cooling effect on the luxury end of the international real estate market if the slowdown is severe.

Related posts:

1. Global housing markets are beginning to stabilize according to the Knight Frank Global House Price Index - Quarter 2 2009.
2. NAR report on Americans living abroad
3. Raising real estate industry standards across Central America