A joint report by JLL and LaSalle Investment Management offers a very interesting insight into the worldwide real estate sector and which markets attract the most money. There are many different factors to take into consideration when investing in real estate but it seems that one of the most valuable is investing in a transparent real estate market. The report by JLL and LaSalle Investment Management shows which markets are attracting the most money and which markets are making great strides in improving their transparency.
UK, Australia, Canada and United States
Those who follow the worldwide real estate market will be well aware that the likes of the UK and the United States of America are extremely popular. However, due to a very high level of transparency the Australian and the Canadian property markets are also attract more than their fair share of investment. The UK stands at number one in the transparency charts, Australia second, Canada third with the United States in fourth place.
This group of real estate markets are seen to be the most transparent in the world offering the least risk of corruption and fraud. Indeed, as we have seen in the UK, many of these countries have recently tightened their property investment regulations giving them a greater stranglehold on the transparency league.
Up-and-coming real estate markets
The likes of France, New Zealand, Netherlands, Ireland, Germany and Finland are also in the high transparency echelons with perhaps Finland and the Netherlands surprising many people. There have been great strides in the German property market of late and, like the economy, it is expected to become one of the more prominent European property markets.
If we now take a look at those just outside the high transparency section we have the likes of Singapore, Sweden, Poland, Switzerland and Hong Kong hovering with intent. Particular mention was made of Poland which is growing in popularity and while it was interesting to see Hong Kong at number 15 in the league there have been issues with transparency in years gone by.
What makes a transparent property market?
The main elements of a transparent property market revolve around security of property ownership, safe housing and workplaces as well as, perhaps more importantly, the ability to trust agents to act both honestly and professionally. We only need to look at the Canadian property market to see how a mistrust of real estate agents can have a detrimental impact upon the marketplace and force governments to act. However, it would be unfair to suggest that only Canada has had this issue of late because many countries have been forced to tighten their regulations.
It will come as no surprise to learn that technology is also a vital element of any transparent property market allow investors to access up-to-date data on property transactions. This is an area where many countries have delivered strong results and indeed the Internet has played an integral part in this. One issue which has emerged over the last few years is the accuracy of official government data with the UK for example forced to revisit guidance on the average house price across the UK.
The bottom line is that a transparent market equates very closely to a secure market which attracts solid long-term investment flows. We are talking about billions upon billions of dollars at stake therefore it is no surprise to see governments tightening regulations to prevent corruption and fraud.