The globalisation of real estate: the politics and practice of foreign real estate investment

Abstract

Foreign investment in residential real estate -especially by new middle-class and super-rich investors -is re-emerging as a key political issue in academic, policy and public debates. On the one hand, global real estate has become an asset class for foreign individual and institutional investors seeking to diversify their investment portfolios. On the other, a suite of intergenerational migration and education plans may also be motivating foreign investors. Government and public responses to the latest manifestation of global real estate investment have taken different forms. These range from pro-foreign investment, primarily justified on geopolitical economic grounds, to anti-foreign investment for reasons such as mitigating public dissent and protecting the local housing market. Within this changing global context, the six articles in this special issue on the globalisation of real estate present a diverse range of empirical case studies from Canada, Hong Kong, Singapore, Russia, Australia and Korea. This editorial highlights four methodological challenges that the articles collectively highlight; they are (1) investor cohorts and property types, (2) regulatory settings, (3) geopolitics and (4) spatial differences and temporal trajectories.

Introduction To The Forum: From Third To Fifth‐Wave Gentrification

“…International capital also flows into gentrifying and already gentrified neighbourhoods through the investments of transnational wealth elites – or simply the super‐rich – and increasingly also upper middle classes into, respectively, ‘super‐prime’ and other classes of residential real estate in elite tourism capitals, prime global cities like London and New York and a range of second‐tier global cities such as Vancouver and Amsterdam (Fernandez et al ; Hay & Beaverstock ; Webber & Burrows ; Atkinson et al ; Ho & Atkinson ; Ley ; Rogers & Koh ). In many cases, these individual investors, especially the transnational wealth elites, do not buy super‐prime real estate to profit from high rents, but rather they use houses and apartments in a select – yet expanding – group of cities as a ‘safe deposit box’, a place to store their excess capital safely (Fernandez & Aalbers ).…”

Housing careers, intergenerational support and family relations

“…In Australia, meanwhile, less than 40% of adults aged 25-34 owned their own home in 2014, compared with 60% in 1989 (ABS, 2016). Thirdly, pressures on cities, especially those with deeper global links, have generated particular geographies of demand, generating more unequal property value increases (Rogers & Koh, 2017) The inequalities in housing equity and inequities in access to housing have helped produce a particular landscape of dependence of younger generations on older ones. As housing has emerged as a critical mechanism of asset accumulation, the capacity of parents to support the housing careers of their children has become more profound.…”

Geographies of hyper‐commodified housing: foreign capital, market activity, and housing stress

“…This investment helps, the government argues, to address the housing affordability problem, while simultaneously bringing benefits to local building construction industries and their suppliers (HRSCE, ; Rogers & Dufty‐Jones, ). While this housing supply and economic stimulus justification is popular internationally, the policy frameworks that underwrite it further commodify housing systems (Rogers & Koh, ). Therefore, we asked survey participants if they thought foreign investment helped to increase housing supply.…”