Many prospective expatriate insurance policyholders have deferred from investing in overseas property because of the uncertainty of the global financial situation, according to the Royal Institution of Chartered Surveyors (Rics).
Chief economist Simon Rubinsohn pointed out that potential international purchasers have tended to back away from the unknown and are likely to be putting their money somewhere where they feel confident.
"Inevitably in a weak market, international flows tend to be the first area where the crisis manifests itself," he explained.
"What you have seen subsequently is a retreat to the home markets where people feel more comfortable."
Mr Rubinsohn's comments follow research released by property company CB Richard Ellis showing that major world cities, including Paris, New York, London and Sydney are among the top destinations for cross-regional investment.
However, investment activity concerning real estate has not yet reached the peak witnessed during 2006 and the first six months of 2007, but there are indications that investment in overseas property markets is increasing.
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