Plenty of opportunities for canny investors

 
There are still plenty of emerging hot spots for overseas investors according to the quarterly investment tracker produced by property investment specialist Assetz.

Cape Verde has continued to live up to its initial potential as one of the next big places to buy for fly to let due to low purchasing costs and sustained capital growth of over 10 percent.

The tourist industry is thriving and developers are keen to meet the international demand for rented accommodation and holiday schemes. Rental yields of 9 percent are possible, and increasingly competitive mortgage products are helping the buoyant market, leading to good returns on cash invested.

Opportunities remain in France as the French presidency take shape.

President Sarkozy is instigating a number of new initiatives, including tax relief on home ownership. Whilst this does not apply to overseas investors, UK based owners of French property will continue to benefit from current good returns and any strengthening in the market as a result of these tax benefits driving up house prices.

Bulgaria continues to improve on its position in the tracker, topping the table of latest figures with a total of 84 percent return on cash invested. However, rental yields are not what they once were due to a severe oversupply in some of the tourist locations. Local agents are reporting a lack of demand and Assetz continues to advise caution in these areas.

The Capital, Sofia, has a burgeoning local economy and is currently benefiting from major development of its infrastructure thanks to an injection of funding from the EU. This is the most likely source of capital gains in a resale market that remains relatively unproven so far in Bulgaria, and poor rental figures for the country as a whole should not be reflected in the potential for high rental yields in Sofia.

High prices are continuing to drive the need for rented accommodation in established locations across the continent, with net rental returns of 7.5 percent and 8.6 percent on cash invested in Portugal and France respectively.

The weak dollar has made American property a lot cheaper for British buyers but it is far from certain that the dollar's collapse is over. There could still be further to go, meaning greater buying opportunities might exist later next year at better prices than today. Purchasers looking for a long-term holiday home could do well buying today, but hardened investors may find a better opportunity next year.

Stuart Law, Managing Director of Assetz, said: “In spite of a continuing slowdown in capital growth across the global property market, it remains an exciting time for investors worldwide. There are several emerging markets with the long-term ability to cause more than a stir of interest among the more canny of property investors.

“In a period of global uncertainty it is vital that investors take a long term view and consider destinations that offer the best chance of sustained stability. It is easy to be sidetracked by the dazzling appeal of some of the more exotic locations we see entering the scene, but investors must hold out to establish their staying power.

“Countries such as Turkey and Greece are not causing any great waves on the global stage, but still have relatively low entry costs and more realistic long term rates of growth than Bulgaria and Poland, which have topped the table in recent times with rates of around 20 - 30 percent.

“High prices are continuing to drive the need for rented accommodation in established locations across the continent, with high rental returns in countries such as Portugal and France.”