A new investors' survey revealed that investors around the world are planning to splurge some $1 trillion into the real estate market this year amid negative sentiment due to market volatility.
The Economic Times reported that according to the CBRE Global Investor Intentions Survey 2016, the industry is going to see a capital inflow of 6 percent higher than that of 2015. The survey conducted in January up to early February found out that investors plan to invest approximately $1.16 trillion in the property market.
Some 82 percent of the respondents shared that they will retain or increase their investing activities this year, down from 86 percent in 2015 and 93 percent in 2014. The report noted that the decline in investment appetite is likely due to current volatilities in equities, the U.S. Federal rate hikes and concerns over pricing.
Nonetheless, the real estate sector remains an attractive option for investors and the expected more than $1 trillion capital inflow would be enough to support global real estate prices, according to CBRE's global president for global markets, Chris Ludeman.
Investors said that this year, they are going to focus more on core assets rather than secondary and value-add properties. According to the survey, only 21 percent said they have higher risk investment appetite for secondary assets, down from 37 percent a year earlier. Office, retail and multifamily assets are the three most popular investment assets.
For those who are considering broadening their real estate investment portfolio by including properties from overseas, NuWire Investor listed six reasons to do so. These include European real estate market growth; Asia, Japan and Australia promising growth; the South American potential for fast turnaround on equity. Investing in the global real estate market is also one of the best ways to protect your capital and generate income in alternate currency cash flow.
