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US-based real estate investing is HOT, and it’s no secret given the intense competitiveness among not just the domestic players, but foreign investors that are also eager for market share.
Noted as the world’s largest economy, the United States often attracts foreign investors for a number of reasons. In the US, we have significantly better loan terms that seem almost magical to foreign investors. Candidly, capital is “cheap” in the U.S., and believe it or not, so are assets compared to many foreign market rates. Even if the investment is not significantly profitable, foreign investors are often eager to park their capital in the US for the benefits of real estate investing generally being very stable and cash flowing.
According to the Bureau of Economic Analysis, foreign direct investment in the United States increased to $4.63 trillion at the end of 2020, which is an increase of $187.2 billion from the year prior.
While international capital only accounts for 3.6% of all multifamily investments, international investors are adding to an already competitive landscape. Fueled further by multifamily rent growth showing historical gains, foreign investors are showing tremendous interest in US-based real estate investing.
Here are the Top 10 Metros of 2021 Flooded by Foreign Investment Dollars:
10. Portland
Amount Invested by Foreign Investors in H1, 2021: $75M
Average Y-o-Y Rent Growth: 8%
Percentage of Renters: 48%
Average Rent: $1,633
9. Indianapolis
Amount Invested by Foreign Investors in H1, 2021: $99M
Average Y-o-Y Rent Growth: 8%
Percentage of Renters: 45%
Average Rent: $992
8. Washington, D.C.
Amount Invested by Foreign Investors in H1, 2021: $111M
Average Y-o-Y Rent Growth: 0%
Percentage of Renters: 56%
Average Rent: $2,160
7. Miami/South Florida
Amount Invested by Foreign Investors in H1, 2021: $164M
Average Y-o-Y Rent Growth: 12%
Percentage of Renters: 45%
Average Rent: $1,915
6. Tampa
Amount Invested by Foreign Investors in H1, 2021: $181M
Average Y-o-Y Rent Growth: 21%
Percentage of Renters: 44%
Average Rent: $1,647
5. Orlando
Amount Invested by Foreign Investors in H1, 2021: $229M
Average Y-o-Y Rent Growth: 14%
Percentage of Renters: 45%
Average Rent: $1,611
4. Baltimore
Amount Invested by Foreign Investors in H1, 2021: $257M
Average Y-o-Y Rent Growth: 9%
Percentage of Renters: 48%
Average Rent: $1,432
3. Phoenix
Amount Invested by Foreign Investors in H1, 2021: $261M
Average Y-o-Y Rent Growth: 21%
Percentage of Renters: 36%
Average Rent: $1,408
2. Dallas/Fort Worth
Amount Invested by Foreign Investors in H1, 2021: $331M
Average Y-o-Y Rent Growth: 10%
Percentage of Renters: 43%
Average Rent: $1,383
1. Atlanta
Amount Invested by Foreign Investors in H1, 2021: $505M
Average Y-o-Y Rent Growth: 16%
Percentage of Renters: 57%
Average Rent: $1,723
Sources:
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About the Author
Ellie is the founder of Blue Lake Capital, a commercial real estate investment firm specializing in multifamily investing throughout the United States. At Blue Lake Capital, Ellie partners with both institutional and individual investors to grow their wealth by achieving double-digit returns by investing alongside her in exclusive multifamily deals they usually don't have access to.
A defining factor of Blue Lake Capital’s strategy is founded in utilizing machine learning/artificial intelligence throughout the course of all acquisitions and asset management. This advanced technology enables the company to produce accurate and data-driven forecasting for all assets on a market, property, and even tenant basis. In doing so, Blue Lake is able to lead commercial investments with the full capabilities of today’s technology.
Ellie is the host of REady2Scale, a podcast that highlights honest, insightful, and thought-provoking discussions on the multiple approaches for successful real estate investing.
She started her career as a commercial real estate lawyer, leading real estate transactions for one of Israel’s leading development companies. Later, as a property manager for Israel’s largest energy company, she oversaw properties worth over $100MM. Additionally, Ellie is an experienced entrepreneur who helped build and scale companies by improving their business operations.
Ellie holds a Masters in Law from Bar-Ilan University in Israel and an MBA from MIT Sloan School of Management.
You can read more about Blue Lake Capital at www.bluelake-capital.com and learn more about Ellie at www.ellieperlman.com.