Published in June 2018, the MSCI’s Real Estate Market Size 2017 report provides a look at the market size of managed global real estate investment.
Real estate, along with Private Equity and Small Business, does not receive the real-time analysis that corporate stocks in publicly traded markets receive. Some real estate is publicly traded through Real Estate Investment Trusts. However, the publicity REITs received in comparison to tech startups is minimal. Real estate, private equity, and small business sectors are vastly larger in investment volume than the few thousand publicly traded firms.
The report looks at the change in national market sizes between 2016 and 2017, national comparisons of GDP per capita with national real estate market sizes, and drivers of market change, including currency impact and capital value growth.
The report notes an increase in global professionally managed global real estate, from 7.4 trillion in 2016 to 8.5 trillion in 2017.
Relative Market Size Estimates
An informative graphic shows the relative estimated market size by GDP per capita. Interestingly, in countries where real estate price is high on sq. Ft. Basis, real estate can exceed 100% of GDP. This is the case in Hong Kong.
A few countries such as Singapore and Switzerland and the UK real estate accounts for above 25% of GDP. The majority of countries, real estate fluctuates between 10% and 25% of GDP. In region’s where real estate makes up a higher percentage of GDP.
A decline in real estate value could lead to a disproportionate decline in government resources or create more volatility within the economy.