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Real Estate Investment - Why it is Big Business?

by Rhiannon Williamson
http://www.shelteroffshore.com

When examining the different asset classes, real estate is generally far less volatile than shares and real
estate tends to be the haven that investors flock to when other asset classes are suffering.

It is true to say that investment properties can have many benefits in terms of building long-term wealth, but
we must never forget that this wealth is not guaranteed!

Following the global real estate boom of the late 1980’s many investors learnt this hard lesson when they
found their properties were worth far less than they had actually paid for them and the bottom seemingly fell
out of the over-inflated market.  The bottom did not truly fall out of the market however as all real estate
retained value; the real estate market simply experienced an overdue rebalance and has gone on to build
from this point of stability.

Since the booming 80’s ‘sensible’ investments in real estate have still offered major attractions and
advantages, and it is back to real estate that investors have turned in recent years.

With real estate prices in some countries soaring, and first time buyers struggling to get onto the first rung of
the real estate ladder, many people are looking further a field for investment property opportunities.

A recent report in the UK highlighted a 130% rise in the value of farmland since the 1990’s for example -
fuelled entirely by a new breed of non-farming buyers.  With bricks and mortar real estate prices in the UK now
so exorbitant, these non-farming buyers are looking for alternatives for their money.

They may be unable to afford real-estate investments and unwilling to risk their cash on the ever volatile stock
market and so they are buying up fields and pastures to get in on the real estate investment game!

Others interested in property investment have been examining the real estate markets around the globe for
value for money, return on investment, potential for growth and development, rental market opportunities and
basic stability.  With current research showing that up to one in eight Britons intend to purchase an overseas
real estate within the next five years you can see that overseas real estate investment is very big business.

Relatively newly discovered property markets are opening up or expanding in countries such as North Cyprus,
South Africa and Bulgaria for example - where potential buyers are afforded incredible value for money when it
comes to real estate.  The real estate market in countries such as these has been artificially restricted
through the threat of war or political instability, and now with their recent history showing that they are stable
countries with strong economies and populated and governed by those with a first world perspective, property
investors are finding markets rich in diversity and potential.

Dubai is another country offering interesting real estate investment opportunities.  Since May 2002 when the
crown prince of Dubai, Sheikh Mohammed bin Rashid Al Maktoom issued a decree allowing foreigners the
right to buy freehold real estate there, the real estate market has exploded!

Properties available in Dubai range from modest one bedroom flats to freehold exclusive islands!  And
property there still offers very good value for money - furthermore the tax and business advantages in Dubai
are very appealing and so real estate investment in Dubai is enjoying a buoyant upward trend.

And then there are the ‘old’ favourites - France, Florida and Spain for example are all countries with a long
history of investment real estate appeal - especially for Britons and Northern European residents looking to
escape the weather and invest in a home in the sun.  Whether you are looking to secure a home for holidays,
your retirement or you are looking for a long term investment opportunity these countries still offer the investor
potential for real estate growth.

When it comes to considering real estate as an investment vehicle it is a tried and tested method used for
attempting to secure long term gains - but as with any investment, gains, returns and security of investment
are not guaranteed.  Whether real estate investment is right for you and matches your circumstances and
attitude to risk is something that you need to consider.