The Impact of Foreign Real Estate Investment on Land Prices: Evidence from Mauritius

Brooks, Chris; Lamport, Matthew; Padachi, Kesseven; Vinesh, Sannassee; Seetah, Keshav; Seetanah, Boopen

doi:10.1111/rode.12316

Cited by 8 publications

(5 citation statements)

References 26 publications

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“…result in economic development in host countries. Overall, Foreign direct investment (FDI) can be positively correlated with housing prices, as one of the factors influencing the increases in housing prices in numerous countries (Sa, 2016), because FDI in real estate contributes to the host country's economic growth by injecting financial resources as well as providing services in terms of supply, costs, quality and diversity, competitiveness, employment, and technology transfers (Brooks, 2017). Blackstone, an American investment company, has invested in the housing sector with the strategy of "buying, repairing, and selling housing", aiming at reducing the rent gap.…”

Section: Literature Reviewmentioning

confidence: 99%

Turkey, the second home for Iranians: push and pull motivations in Turkish housing market

Ghaedrahmati,

Rezaei

2024

JERER

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PurposeThis paper examines the main drives of encouraging Iranian investors in the Turkish real estate market, focusing on the interface between push factors and pull factors that drive them abroad.Design/methodology/approachThis paper examines the main drives of encouraging Iranian investors in the Turkish real estate market, focusing on the interface between push factors and pull factors that drive them abroad. For this purpose, the trend of housing price growth in Iran and Turkey was compared. The review of the 11-year trend of rates shows that housing prices in both countries have been continuously rising, and these prices have undoubtedly experienced increasing shocks in Iran. For further analysis, 13 main variables leading to the repulsion of investment in Iran's housing market and 15 variables shaping the attractiveness of investment in Turkey were identified in this sector. Thirty experts subsequently ranked the significant variables based on a closed-end questionnaire using quantitative strategic planning matrix. Examining housing investment elasticity in Turkey also shows that “Turkey's economic stability compared to neighboring countries” and “acquiring Turkish citizenship through real estate investment” are among the most important variables. On the other hand, the pressure variables of housing investment in Iran were “decrease in the value of the Iranian currency in recent years,” “currency price fluctuations” and “severe fluctuations and instability in the Iranian housing market.”FindingsExamining housing investment elasticity in Turkey also shows that “Turkey's economic stability compared to neighboring countries” and “acquiring Turkish citizenship through real estate investment” are among the most important variables. On the other hand, the pressure variables of housing investment in Iran were “decrease in the value of the Iranian currency in recent years,” “currency price fluctuations” and “severe fluctuations and instability in the Iranian housing market.”Originality/valueFrom a theoretical standpoint, foreign investment is in support of Turkey and harmful to Iran because the Turkish government is bolstering investment attractiveness to bring increased capital inflows into this country. Practically speaking, Turkey has aimed to create a rational framework for investors by strengthening and changing its economic system, as well as amending existing constitutions in this domain. Nevertheless, Iran resists any changes in its economic system and legislation. Therefore, a wide range of attractiveness and repulsion variables has led to the migration of Iranian investors to Turkey. In the present study, such variables are illuminated.

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Section: Literature Reviewmentioning

confidence: 99%

Turkey, the second home for Iranians: push and pull motivations in Turkish housing market

Ghaedrahmati,

Rezaei

2024

JERER

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“…A preliminary study on the influence of FREI on land prices in Mauritius was undertaken by Brooks et al (2017) using a pooled panel regression approach with data over the period 2006 -2013. They used the prices of the residential infrastructures sold to the foreigners and the land prices prevailing in the specific regions where the developments had taken place and concluded that the foreign investments had led to regional land price increases situated between 4% -22%.…”

Section: Island Studies Journalmentioning

confidence: 99%

“…Foreign real estate investment has been important in island economies over the past decades and only a few studies undertaken on this topic (Álvarez et al, 2020;Brooks et al, 2017;Mihaljek, 2005;Rose & La Croix, 1989;Wortman et al, 2016). From the island state's perspective, only a few conceptual or surveybased studies were undertaken in the following contexts, Croatia (islands) and Mauritius to study the link between FREI and real estate prices.…”

Section: Island Studies Journalmentioning

confidence: 99%

“…Some studies have used latent variables as explanatory variables for land prices, for example, land regulations, tax relief on mortgage interest payments, or the preferences of land buyers, among others (Algieri, 2013;Fadiga & Wang, 2009;Hannonen, 2005;Huang, 2019). A few studies have probed upon the link between foreign capital inflows and real estate prices, using different measures for capital inflows and mainly focusing on how these have been affecting housing prices (Ahmed et al, 2021;Brooks et al, 2017;Gholipour, Is Rising Residential Land Prices a Consequence of Domestic or Foreign Land Demand? Evidence From Mauritius Island Island Studies Journal 2013; Mihaljek, 2005;Sa, 2016 andTillmann, 2013, among others).…”

Section: Introductionmentioning

confidence: 99%

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Is Rising Residential Land Prices a Consequence of Domestic or Foreign Land Demand? Evidence From Mauritius Island

Gopy-Ramdhany

Seetanah

2023

Island Studies Journal

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Some emerging island economies have been fostering foreign direct investments in the real estate market. Given the rise in real estate demand under such contexts, this must have entailed a rise in land demand, and subsequently, land prices could have been affected. This study assesses if the rise in land demand caused by domestic and/or foreign land demand has been influencing residential land prices in Mauritius. To undertake the research, annual data was collected from the year 2000 to 2019 and a structural time series approach was used. It was found that unobserved components, namely the trend level and slope, as well as the cycles were significant in explaining land prices. It was concluded that fluctuations in land prices are significantly explained through latent variables, such as regulations in the land market, fiscal policies concerning mortgage loans, and speculative land buying among others. It was also found that foreign real estate investment (FREI) used as a measure of foreign land demand did not significantly influence land prices. To further probe the factors affecting land prices in Mauritius, domestic demand-side factors were considered and it was found that income, population, unemployment, and real construction costs were significant in explaining land prices.

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“…The country gained independence from the United Kingdom in 1968 and has since experienced rapid economic growth. It has developed from a low-income economy dependent on the revenue from sugar cane to a diversified upper middle-income economy considered one of the strongest and most stable economies in Africa (Brooks et al, 2017;Svirydzenka & Petri, 2017). However, many social challenges remain to be addressed and segments of the population are experiencing increasing vulnerability and social exclusion (Tandrayen-Ragoobur & Kasseeah, 2018).…”

Section: Background: Csr In Mauritiusmentioning

confidence: 99%

Ecosocial work through corporate social responsibility: the case of company engagement with civil society in coastal communities in Mauritius

Rambaree

2020

Journal of the Indian Ocean Region

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This article presents a case study of corporate social responsibility (CSR) in coastal areas of Mauritius where company CSR work has brought new ways of engaging with communities. The study examines in what ways companies are involved in ecosocial work and what the challenges and possibilities are from an environmental justice perspective. Based on interviews with representatives of companies and other organizations involved with CSR the study shows that CSR involvement in ecosocial work may bring possibilities for advancing environmental justice for local communities as it can enhance resources and capacity building, as well as bring actors together and play a role in advocacy and empowerment work. Challenges include that companies may have difficulties in contributing to greater justice in terms of community involvement. Moreover, inequalities and substantial environmental justice issues, such as access to land and safe housing, are difficult to fully address through a CSR framework.

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The Impact of Foreign Real Estate Investment on Land Prices: Evidence from Mauritius

Cited by 8 publications

References 26 publications

Turkey, the second home for Iranians: push and pull motivations in Turkish housing market

Turkey, the second home for Iranians: push and pull motivations in Turkish housing market

Is Rising Residential Land Prices a Consequence of Domestic or Foreign Land Demand? Evidence From Mauritius Island

Ecosocial work through corporate social responsibility: the case of company engagement with civil society in coastal communities in Mauritius

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