Research shows South Africa to be low-risk emerging market
Research into global real estate investment is increasingly pointing to South Africa as a country with high potential returns and relatively low risk.
Professional service consultants Ernst & Young's 2006 global real estate investment trust (Reit) report puts South Africa with returns of 23 per cent for last year and an average of 34 per cent over the last three years, eProp reports
Ed Psaltis, author of the report, said the country was "becoming more visible". He added: "Even before our report was released our head office in New York was forecasting South Africa as one of the new and emerging markets in the global property and Reit sectors."
As well as showing the highest returns over the last three years of reports, South Africa was also the least volatile of all the countries surveyed.
The transparency in the country also reduces the risk for investors, according to Padraig Brown of Jones Lang LaSalle.
"Real estate transparency is a major component of risk faced by investors, especially as they get more active in cross-border deals," he said.
"South Africa's property market is unique among emerging markets as its transparency is similar to that of many more developed nations," he added.
The opportunity to gain the returns of an emerging market in a stable country is expected to encourage more foreign investment.
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