Emerging Global Real Estate Markets

It was an area much neglected in the past and not taken seriously; real estate today plays a key role in investment portfolios and has become an intrinsic part in the life of investors as well as property buyers. Developed countries have given it much significance owing to its great necessity for interested clients.

Some facts about global real estate

Some facts about global real estate

Real estate investment trusts (REITs) exist since a long time Australia, U.S and Netherlands. With the advancement in international communications, other continents adopted the structure of REITs and modified it according to their specific requirements. This has resulted in the emergence of global real estate market, where brokers and clients are ever conscious and well-informed. Many run their business broker franchises in various countries and enjoy this business a great deal. It’s no more confined to a few places only. Entire world has been affected by its immense benefits and importance. An estimate in 2005 revealed that the market capitalization of real estate operating companies(REOCs) and global REITs went up from $280 billion in 2001 to approximately $700 billion in 2005; that is a considerable growth indeed.

Real estate securities all over the world have a great variation in the characteristics from that of U.S counterparts so these are separate from them as an asset class. Global real estate has a unique role in these varied investment portfolio.

Real estate structures

Real estate is not all about direct investment in any type of property; it goes beyond that and has mainly two securitized structures. The two forms are REITs (Real estate investment trusts) and REOCs(Real estate operating companies).

REITs

These are structures that work for special tax processing in return of fulfilling certain conditions , for instance paying almost 90% of the taxable income on annual basis,  in the form of dividends; earning 75% of gross income from mortgage interest or rent from real properties and investing at least 75 % of the total assets in qualifying real estate assets.

Going back to its history, REIT existed in U.S since 1960. Afterwards, in 1969 Netherlands adopted real estate structures. New Zealand and Australia followed it eleven years later from U.S in 1971. According to Deutsche Bank PREEF Research article titled ‘ Global Real Estate Securities’ published in January 2007, there were 18 countries that successfully operated REIT structures; Germany got legislation in pending status.

REOC

REOC

As the name suggests, this is a listed real estate company that primarily deals in real estate investment as well as development. It has many business brokers (real estate agents) that serve clients and they deal in all types of property in commercial and residential sector. Some also offer franchise opening options for interested people and this spreads a chain working inside and outside a country. These have gone online with the revolution in internet and IT and now the access to them is easier than before. There inter connections are also faster and efficient now.

Global real estate will keep on moving ahead and the number of countries adopting REIT-type structures will surely increase all over the world.

You might also like

What You need to Know about Real Estate Attorneys The real estate lawyers, reviews and documents real estate transactions and get paid for it. They make...
Forces Behind The Real Estate Market In the world today, most people’s wealth is to be found in real estate. This is true to America, where...
How to Make Money in Real Estate Investing in real estate can be a pretty profitable affair. If you have the understanding of the market,...
8 Signs Of Increase In Property Prices In Your Area In 2007 when US economy went in a recession, real estate market also faces the same recession period...
Choosing A Real Estate Agent Every one in his life needs to buy or sell property. And for this, he has to consult a real estate agent....
Debt Consolidation Companies

People who liked this Post also read

  • International REITs
    Currently, there have been a lot of changes in the global real estate market. Considering both, the developed and developing foreign markets, the REIT and REIT-like structures have started to gain immense popularity. There has been an increase in the oppo...
  • Impact Of Interest Rates On Real Estate
    There is a very strong inverse relationship between Real Estate Investment Trust prices and interest rates in the economy. An increase in the interest rate is likely to result in a similar decrease in trust prices and a decrease in interest rates will cau...
  • Types Of Real Estate Investment Trusts
    You can take into consideration different types of real estate investment trusts for the purpose of making equity or fixed income investment. This is because of the assurance of a considerable amount of income with larger expansion and lesser risks....
  • Effective Tips To Sell Your Home In A Down Market
    It is very difficult to sell your home when the real estate market is showing a declining trend. As the supply is more than demand during such tendencies, you can easily sell your home by lowering the price. However, there are several other ways as well b...
  • Out of State Real Estate Investment
    There are many issues to deal with once you are investing in real estate. However, it gets even more complicated if you are buying property out of state. You will be facing may challenges....


is an experienced journalist.

Leave a Reply

© 2012 Loan Mortgage Credit!. All rights reserved.