Where to Invest in Property? These Cities may be Your Answer

Hong Kong | Global Property Investment

Foreign investment in property has recently affected the housing markets in a number of different countries that are now seeing a flux of growth. From the US to the Far East, certain cities are constantly evolving into the latest hot-spots for investment in real estate. Although some capital cities including New York, Rome and Tokyo remain a consistent prime spot for real estate, ever growing outwards. Taking London as an example, the rise of house prices in the city is slowing down in its most expensive areas such as Notting Hill and Knightsbridge, but is now shifting into some the surrounding boroughs. Meanwhile, other lesser cities in Britain are seeing growth in their property prices and this isn’t something that is limited to the UK, leaving the question: Where to Invest in Property? 

Barcelona – Spain

As Spain’s economy makes a come back (0.9% GDP increase in 2015s 1st quarter; according to the Instituto Nacional de Estadistica), the property market in the largest Iberian country is growing in strength. Within this first quarter of 2015, 12.2% of Spanish residential properties were purchased by foreign nationals and Barcelona is now revealing itself to be leading the market. Spanish News Today has reported that the city’s average sales price has risen by 3.5% within the last year.

Thunder Bay – Canada

The fantastical name of Thunder Bay seems ironic for one of Canada’s hottest spots of real estate. Once a stopping point on the trade route from West to East Canada that fell into decline, Thunder Bay has since grown through, not just its medical prominence, but the development of the government and commercial departments that supply to Ontario’s northern inhabitants. As the city has become a hub for medical services, students have taken up residency in the city to attend the Northern Ontario School of Medicine increasing the number of those looking to rent. 

Shanghai – China

The Chinese economy has been slipping recently, but as an offset, its commercial real estate has grown by 72% in the last 4 years meaning property is still a hot market in the country. The real estate market is one that has also seen some growth despite the economic down turn. Shanghai for instance has seen the average sale price of new homes rise over the last 4 months with a price rise of 3.77% for new homes in the city.

London and the South Coast – England

London still remains the favourite city in the world for UHNWIs – according to Knight Frank 4,364 ultra high net worth individuals are resident in London compared to second placed New York 3,008 and third-placed Hong Kong with 2,690.

While London remains the place in England that most deem to be a wise investment in property, it has proven itself to be a tough nut to crack with its steep buying prices. The Huffington Post reports “average rental yields often fall well below 4%.” while also recommending that “you need to look beyond London, to some of the regional cities that offer average returns of up to 8.7%.” The port city of Southampton is one of these cities that goes beyond that. It has a high average price per property, but the average of rent justifies the pay-out. With a large student population, a pool of people in their early careers and the collection of young families, there is no shortage of people looking to rent.

These cities are just a handful of places that can offer great investment opportunities. You’ll need to be doing vast sums of market research that go beyond this blog post to make an informed decision, but when it comes to choosing where to invest in property, it seems that currently the capital cities may not be the answer.

About the Author:

Adam is a freelance writer that focuses on luxury asset trends for Borro Private Finance.