The best real estate investment in the world today Beachfront properties in Somalia. That is according to Hans Rosling, a Swedish public health professor and data visualisation pioneer. A statistical geek is an unlikely source of property investment advice but Rosling’s rationale is convincing — and it is one that professional property developers such as Barratt and Klépierre are already putting into practice.
The explanation lies in demographics. All of the world’s forecast 3bn population growth through to 2100 will be urban, Rosling points out; a third will be in Asia, while two-thirds will be in Africa. In economic terms the developed west will grow at 1 to 2 per cent a year through until 2100, while the rest of the world will grow at 4 to 6 per cent. This amounts to a startling global shift in the pattern of trade.
“The Indian Ocean will be the Atlantic of the next generations,” predicts Rosling. As a result, the surf-beaten golden sands that stretch north from Mogadishu will make excellent holidaying territory for the Asian middle classes, several years from now.
Somalia is a colourful example of the best and most likely long-term real estate investment, but it is not the only one. As the world urbanises, it is throwing up a series of new opportunities for those willing to think a little more creatively about where to place their money.
“Particularly in Asia and the Middle East, cities are growing massively and investors are looking for alternatives to invest in,” says Mark Haefele, global chief investment officer at UBS Wealth Management. He references urban infrastructure, housing, food, water and sanitation as all being in great need of investors’ cash. As one example, he cites Asian investors who have begun to buy up Australian dairy farms.
Oceanfront real estate in Somalia is still affordable, but it is expected to increase in value and cost as investors jump into the growing market. If you have ever wanted a beachfront property that is pristine and offers an untouched glimpse of wildlife with unobstructed sunset views, investing in Somalia could be a good option this year.
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