To celebrate its UK launch the property investment company, Prestige Group, yesterday released its first International Hotspots Index.

The Index sets out a top-ten of overseas residential hotspots, providing an incisive guide for investors who are thinking of buying foreign property.  It examines key factors that need to be considered before investing abroad, including: prices, rental yields, the local legal system, social and economic stability and the cost of finance.

Prestige Group already undertakes this analysis within its mainstream business but has now decided to make this information publicly available.

"Exceptional opportunities" in Warsaw

Top of the Index is Warsaw about which Prestige comments: "Warsaw is good value with an increasingly strong economy - some exceptional opportunities are available at the high end of the market."  In number two slot is Florida, which currently delivers the highest house price inflation although Prestige warns that it "cannot maintain such strong appreciation levels in the longer term."

Five of the top ten hotspots are emerging markets and three are in former Eastern Bloc countries, highlighting the trend for property investors to move away from the Mediterranean towards less traditional investment countries.

Paul Coghlan, Chairman of Prestige Group commented:  "Investment in overseas property is moving away from the holiday homes' market and towards attainment of stronger appreciating property in the less traditional countries such as those in CEE."

He continued: "The market has been fuelled by interest from homeowners in the UK and Ireland who, seeing their homes increase in value, wish to make equivalent gains in other emerging markets.  Increasingly these residential property purchasers have clearer investment goals, making them much more calculated about their decisions."

Move along the Costa...

The Algarve’s central and eastern areas have been successful investment areas for a number of years but Prestige comments that the Central Algarve is "increasing overpriced".  Recently the Western Algarve has emerged as a prime location offering excellent value for money.

Cape Town and Dubai feature in the top ten but certain legal issues concerning ownership rights remain with both destinations.

At the bottom of the list comes the Spanish Costas where Prestige advises against buying due to "legal issues and overdevelopment".

Although not making the top ten, Prestige tips off Brazil as an up and coming property market with "great potential for the future".

Paul Coghlan, commented: “All too often investors focus on the price of property and potential price increases, whilst factors such as the ease of finance and the legal issues are overlooked.  Overseas residential markets provide a great opportunity for some major returns but, as with any investment, people have to see past the hype and do their research.  The idea of the index is to provide some guidance to potential investors.”