Foreign Real Estate Is Best to Buy in These Markets

NEW YORK (MainStreet) — The international market that is most prime for investment now is Panama, according to a new report.

"U.S. markets are heady and uncertain," said Lief Simon, an international investor and author of Live and Invest Overseas. "Therefore, the most important agenda for any U.S. investor as we head into 2014 is diversification and real estate overseas is the best possible strategy."

A Live and Invest ranking placed Panama at the top of a list of five due to its property values that have appreciated in key waterfront areas. These districts include Balboa Avenue, Punta Pacifica and Costa del Este.

"Just around the corner is the expected completion of the canal expansion," Simon told MainStreet. "New apartment inventory is low and immigration remains high as banks, international corporations and retirees continue to expand into this market."

In second place is Paris, which features such spruced-up parts of its cityscape as 25 million-euro renovation of Montmartre's Luxor Theater.

While the real estate market in rural France has remained flat since the downturn, values in Paris saw reasonable growth in 2011 and 2012, according to Simon.

"Particularly of interest right now is Montmartre in the 18th arrondissement," Simon said. "This is one of the most active rental markets in the city and a neighborhood that is attracting increasing investor attention."

Uruguay landed third place because 95% of the country is farmable.

"Farmland isn't a new asset class," Simon said. "It's the world's oldest. However, it has become very attractive in the past several years and is going to become more attractive over the coming decade as the world's population continues to expand."

The race to own farmland is so furious that Brazil imposed restrictions on foreign ownership of productive land.

But unlike in Brazil, foreign and local investors are treated the same in Uruguay. There are no restrictions on foreign ownership or use of land.