Four Global Property Markets Where Foreign Elites Are Buying Like Crazy

In markets across the world, housing is back in a big way.

But to the chagrin of those living in some of the globe's hottest cities, a booming housing market doesn't always mean that locals are the ones who can afford to buy.

In many cities, foreign buyers — particularly Chinese and Russian investors — are buying up real estate like crazy and driving property prices to pre-financial crisis levels.

Here are four markets being spurred by foreign investors.

1. Cyprus

Cyprus has its economic issues, but before March's harrowing economic shock, foreign buyers were heading to Cyprus' sunny shores en masse. As the Guardian's John Hooper reported in February, "The carnival will be a way of celebrating a most unusual boom in a country which, like others in southern Europe, has been stricken by the eurozone crisis. Property prices in Cyprus have fallen by around 15% since 2007. Yet an official survey published last month found that between last August and October more than 600 properties were sold to Chinese buyers, 90% of which were in Pafos" — a small Cypriot city.

It will be interesting to see if foreign investors stick around in the beleaguered island nation.

2. Brooklyn

New York City's real estate market is red-hot in general, with low inventory juicing big-time bidding wars. But foreign buyers have been buying up townhouses in Brooklyn in particular, according to Brownstoner. From the report:

We spoke to six real estate agents, four of whom said they had encountered investor groups buying houses to rent out. Some of the firms are European and Israeli, they said. One broker had high praise for one of the private European investment groups he had encountered, a boutique firm with local buyers that focused on buying high end properties with historic detail to rent. He also said that in the first quarter, the bulk of all-cash buyers he dealt with were families, not investors.

One such outfit, operating under the name Newtown Jets, has purchased 24 properties in Brooklyn since March, including 12 in May, according to PropertyShark. The transactions were all over the map geographically and pricewise, from Park Slope ($2,675,000) and Carroll Gardens ($1,699,000) to Bushwick ($662,500 and $599,000).

Few homes, rich buyers, sky-high prices. It's tough to find a place in Brooklyn.

3. Australia

Australia eased some of its federal laws restricting foreign property ownership, and according to Paul Thornhill at RealEstate.com, the change "has opened the door to a flood of interest from overseas purchasers."

Buyers from Hong Kong, China, and Singapore have been buying up property on Sydney's north shore, Thornhill writes. He lists three reasons why Australian markets are prime for foreign investors:

1. "Aussie real estate has proved a secure investment, while perennial favorites – think U.S. shares and European bonds – have been surprisingly volatile."

2. "Wealthy families are investing part of their portfolio offshore because of concerns about political stability or the sometimes arbitrary actions of government officials."

3. "Purchases are tied in with establishing a residency for a family member in a safe prosperous country like Australia."

4. London

Real estate price jumped 10% in October, and a new report from Deutsche Bank shows that much of that price growth has come from foreign investors. Russian and Eastern Europeans have lapped up some of the ultra-pricey homes — considered a "safer" investment than other assets.

In fact, now that foreign buyers comprise 70% of all newly-built property sales in central London, Britain is considering a capital gains tax on foreign property investors.