The U.S. housing sector recovery appears to have captured the attention of investors around the globe. Real estate entrepreneurs from around the world have apparently set their sights on the American housing sector. Encouraging trends in our economy suggest a sustainable progression for the foreseeable future. With that being said, four of the top five cities for foreign real estate investments are located within the confines of U.S. boarders. America is, therefore, a hotbed of foreign investment activity.

According to a survey of members in the Association of Foreign Investors in Real Estate, the U.S. is the “stable and secure” country for real estate investment “by a wide margin.” The U.S. is also the top market when it comes to capital appreciation and for future real-estate purchases. The lofty praises may be attributed to a variety of economic conditions, but it helps to have four of the top five cities in the world that attract foreign investors.

The following cities are among the best in the world for foreign investments:

  • London (#1)
  • New York (#2)
  • San Francisco (#3)
  • Los Angeles (#4)
  • San Diego (#5)
  • Houston (#6)
  • Seattle (#7)

It may come at no surprise to see both New York and San Francisco amidst the top foreign investment cities, as they have continually exhibited higher than average levels of asset appreciation. The exception, however, is Houston. The placement of Houston on this list suggests that foreign investors are starting to look beyond the obvious locales within our boarders.

“Our members’ increasing interest in cities beyond the powerhouses of New York, Washington and San Francisco points to the recognition of additional investment opportunities for foreign investors,” said James E. Fetgatter, the association’s CEO.

Members of the association are overwhelmingly representatives of an institution, but some are high net-worth families looking to increase real estate profits. It is important to note, however, that the survey doesn’t track investments in single-family homes. The number one category for investment in 2013 was industrial properties, followed by office, retail and multifamily homes. This is particularly interesting, as multifamily homes ranked first on this list as early as last year. The trend suggests a change in investment strategies.

According to data contributed by the National Association of Realtors, foreign buyers had acquired $68.2 billion in single-family homes in the U.S. as recently as March 2013. That number represents approximately seven percent of the entire U.S. market for the respective year. While significant, foreign investment was actually down from the $82.5 billion invested during the same period of 2012. China and Canada exhibited the biggest interest, as they experienced the largest growth of foreign funds in the last year.