Save Now, Invest Later

(annual savings growth in emerging and mature economies, 2004-2022)

Source: Jones Lang LaSalle Inc., Oct. 2012.

In a recent study of global investment patterns, Jones Lang LaSalle Inc. suggests that personal savings growth is an indicator of growth in real estate investment. “As we have seen, consistent growth in domestic savings can lead to a proportion of that capital ending up in direct real estate, both direct and crossborder,” the report notes. “We estimate that there could be a significant increase in crossborder investment activity based on this growth in global savings.”

The trend could account for a $1.9 trillion increase in crossborder investment by 2020, Jones Lang LaSalle estimates. Four of the top seven savers are the BRIC countries — Brazil, Russia, India and China — plus Indonesia, Poland and Turkey. All seven demonstrate annual savings growth of at least 11 percent.

For comparison, the researchers included projected savings growth for several mostly English-speaking industrialized countries: Australia (9.1 percent), the United Kingdom (6 percent), the United States (5.6 percent), Canada (5.4 percent) and Japan (2 percent).