Cross-border deals up 334% since 2009

by Ephraim Vecina08 Feb 2016
In the aftermath of the financial crisis, the latest report from global real estate services firm Savills revealed that cross-border real estate deals have entered a renaissance, having grown by 334% from 2009 to 2015.
 
Representing an increase in value from $65 billion to $217 billion, the number of foreign real estate transactions has also climbed from 17% just after the recession to 20% last year.
 
According to the report, global real estate (which stands at $217 trillion) now accounts for nearly 60% of the value of all assets worldwide, including traditional heavyweights such as bonds, equities, and gold.
 
Residential properties comprise 75% of the global real estate value, while commercial and agricultural are 13% and 12%, respectively.
 
Savills officials said that the widespread access to either low-priced debt or substantial equity has fueled the resurgence in cross-border transactions.
 
“Many players in recent years have been operating under much looser monetary conditions than in previous decades, so money has become cheaper and opportunities have been presented in those countries where asset prices were hit by domestic recession,” Savills World Research director Yolande Barnes said in a statement, as quoted by OPP.Today.
 
The Savills report estimated that taken collectively, real estate assets are worth nearly three times greater than the world’s annual income, showing the central role the sector plays in the global economic machinery.
 
“Real estate is the pre-eminent asset class that will be most impacted by global monetary conditions and investment activity and which, in turn, has the power to most impact national and international economies,” Barnes noted.

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