Developed markets ‘are full’
Developed property markets "are full" or "over-valued" according to a leading property expert.
Chris Allen, head of real estate fund management at HSBC Private Bank, has told the Financial Times that the bank is now focussing on developing and emerging markets in Asia and Latin America.
He explained the bank’s reasoning for this to the paper: "There is the growth of the middle classes in many countries which is leading to the need for new towns and cities, with housing, offices, schools and infrastructure."
Latin America, he added, should be considered a key area for investment, particularly Brazil due to its "falling interest and inflation rates" which have coincided with "stability in the political system" together with growth in the owner-occupied property sector.
However in order to succeed in these markets it is important to work with local specialists, he stressed.
Mr Allen’s comments follow Rics’ global property survey, published last month, which also tipped the Bric (Brazil, Russia, India and China) economies as investment hot-spots in the coming months.
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