Experts disagree over which country will emerge first from the global real estate downturn

Real estate analysts are now looking ahead to a recovery in global property markets but few agree on where the green shoots might appear first.

Global real estate investors, keen to snap up bargain assets, are keenly watching for signs of a sustainable recovery.

But opinion varies widely. On one hand some think that the UK, which has fallen the longest and deepest, could be the first to recover, whilst others believe that the fast growing economies of emerging markets in Asia and Europe will lead the pack.

'The financial crisis will allow countries which were not considered good for capital real estate investors to become more interesting. For instance, the US is becoming less and less important,' said Edward LaPuma of WP Carey International.

Funds are undoubtedly circling to look for bargains, especially in the commercial property sector. A survey of over 50 countries by the Royal Institution of Chartered Surveyors showed commercial property values fell across all emerging markets in the last quarter of 2008, the first time this had occurred in the survey's history.

The UK's commercial property market was the first to enter recession after a five year bubble burst in the middle of 2007, sending values plunging by as much as 44% as of last month.

'You're immediately drawn to the recovery markets where depression hit first and these are the UK and Spain. There is an awful lot of money looking for a home, particularly in the UK,' explained Mike Sales, head of property investments at Henderson Global Investors.

Others are more wary, believing the effects of damaged credit markets will put the debt fueled UK market on course for a long drawn period of stagnation. 'A lot of people are raising money for opportunity funds on the basis of constant talk about green shoots in the UK. But while things have stabilized a fraction, it is going to be a long, slow haul out of the mess,' said Steve Smith, Axa REIM's head of transactions and asset management.

Citi Property Investors President, Roger Orf, expects commercial real estate in the BRIC economies – Brazil, Russia, India and China – to be among the first to rebound.

'Real estate growth tends to be linked to gross domestic product and these countries will probably see growth of 9 to 12%,' he said.

Some industry players focused their optimism on their home markets, betting that the fundamental strength of these countries markets will pull the industry out of its decline

'Russia can and should emerge from the crisis earlier than other European countries because there is a fundamental shortage of residential real estate in the country,' said Igor Levit, CEO of St Petersburg-based real estate firm LSR Group. Indeed the recent rise in oil prices, which has more than doubled to about $70 per barrel since December, will boost Russia's recovery.