Estimating the Size of Real Estate Markets Around the World
Executive Summary
- Our update of A Bird’s Eye View of Real Estate Markets estimates the size of real estate markets around the world, distinguishing between the stock of high-quality, institutional-grade investable real estate and the stock that has been invested in.
- We estimate that at the end of 2020, the global value of investable real estate stock was $31.1 trillion. We expect that during the next 20 years, that value will grow by an average of 5.2% a year and be worth more than $85 trillion.
- We also find that today, only 36% of that stock – roughly $11.2 trillion – is actually traded. Given both the ongoing emergence of real estate as an asset class and the outlook for economic prosperity and financial markets, we estimate that by 2040, the size of invested stock will be worth more than $40 trillion.
- With developed markets remaining a dominant feature of the investment landscape, the fastest growth in invested stock is set to take place in Asia Pacific. We expect China to become the second-largest real estate investment market in the world by 2030.
- The investment case for holding a portfolio of international real estate remains compelling. The diversification benefits alone make the case as countries grow and evolve in different ways and at different rates. Even in the presence of global shocks such as the COVID-19 pandemic, countries are impacted differently and recover differently.
A Bird's Eye View of Real Estate Markets
PGIM Real Estate’s proprietary estimate of the size of high-quality, institutional-grade investable real estate stock around the world.
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