Investors Re-Sale Potential

Investors Re-Sale Potential

Political and economic research into investment locations is essential in emerging markets. Understanding the economic growth factors of the country can provide some insight to the mid and long term market value and demand. This is also important for understanding potential exit strategies for selling the property in the future.

A country’s susceptibility to variations in long term economic stability can determine some of the investment’s risk factors. For example, emerging markets reliant predominantly upon tourism for growth present risks to real estate investors, as the country’s economic environment is not sufficiently varied. While the market may appear to be in its initial growth stages at the time of purchasing, market expansion will depend upon continued demand and interest in the region.

Re-sale potential is significantly improved in locations where the domestic population is capable of accessing the real estate market. In regions where the property is significantly overpriced for the domestic market, re-sale possibilities will be limited to other foreign investors. This can pose a problem if at the time of selling buyers are more interested in newer, possibly cheaper property in a more easily accessible location.

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