TOKYO -- On the top floor of one of the swankiest department stores in Tokyo, salesmen are doing brisk business in a popular new product: United States real estate.

With ever-increasing frequency, doctors, businessmen and others leaf through glossy photos and floor plans on display at Seibu department store and then spend hundreds of thousands of dollars, or more, to buy Hawaiian beach-front properties and Manhattan high-rise apartments.

According to sales manager Kazuo Saito, these affluent Japanese are eager to "buy American" for the same reasons that investors -- especially corporate ones -- from Europe and elsewhere are buying up some of the United States' best-known landmarks, along with its clothing stores, book publishers, country clubs, and stocks and bonds. Viewed from abroad, the United States is a huge, wonderfully stocked discount store, overflowing with bargains because of the depressed value of the dollar.

While Americans fret about the "hollowing out" of their industrial base, and runaway budget and trade deficits, foreigners see a stable political system, an unfettered economy with inflation more or less under control and a huge, open marketplace up for grabs. "It basically comes down to faith in America," said Walter Buytaert, vice president of Prudential-Bache Securities Inc. in Frankfurt, West Germany. "With good solid {corporate} earnings growth, it's the place to go."

Across the Pacific, Shigeru Kobayashi, head of Shuwa Corp., one of the major purchasers of prime U.S. real estate, echoed the sentiments: "No other country in the world can accept foreign people and investment as freely as the U.S.," he said recently.

In the last few years, many others have clearly come to feel the same way. As the dollar has dropped more than 40 percent against the Japanese yen, the West German mark and other major currencies, foreign investment in the United States has grown from a stream into a flood. In the process, it has sparked a debate over whether these foreign purchases are helping the U.S. economy by creating jobs or hurting it by creating a Third World-like dependency on others.

Regardless of which analysis is correct, foreigners now own more than $1 trillion worth of U.S. real state, stocks and other goods, according to estimates.

The British lead the pack in total accumulated U.S. assets, followed by the Dutch and the Japanese. But most of the Japanese investment has occurred in only the last couple of years, in large part because Japanese government policy severely restricted overseas investment until 1980. Economists say it is probably only a matter of time before the Japanese, awash in money, take over the lead.

At the most fundamental level, foreigners are drawn to the United States because, for all its democratic ups and downs, it is viewed as a bedrock of political and economic stability, businessmen, economists and banks here and in Europe say.

"People in our country don't see the United States as safer in the short term, but they do see it as safer in terms of longer term commitment to capitalism," said an economist at Commerzbank in Frankfurt. "There is no danger of nationalization. There is no danger of socialist government. We have seen such things in Europe."

But it is the bottom line that ultimately determines where dollars go, foreign experts said, and no country can compete with the United States when it comes to the sheer number of choices for investment. "The variety of the possibilities -- stocks, bonds, real estate -- cannot be matched anywhere else and the volume is so good," said Mitsuharu Hashimoto, manager of Japan's Long Term Credit Bank.

Said Buytaert: "There's so much money available and so few places to put it {in Europe}." At the same time, the U.S. market is so vast that it can comfortably absorb all the money cash-rich foreign companies want to pour into it. "Other markets are smaller so if you buy a big amount and then sell it may cause the market to drop and hurt your investment," said Hiroshi Kurotori, manager of Nomura Securities Co.'s division that handles bond transactions, the major focus of Japanese investment.

According to Hashimoto, Japanese are investing in many other countries, including Canada, Britain and Australia, but Japanese investment in the United States is 10 times that for all the other countries combined. Most foreign investment in the United States is in stocks and bonds, a major reason, economists say, why the stock market has remained so high the last few years and U.S. interest rates so low. The draw for foreigners is that yields in these areas are much higher than can be found at home.

In Japan, for instance, government bonds until recently were paying about half of what the U.S. Treasury was offering. Even the instability of the dollar, which has cost many foreign holders of long-term bonds a lot of money, has not yet caused foreigners to slow their purchases.

While the Tokyo stock market has hit sky-high levels, and thus might offer a worthy alternative, its increases have been a little too dramatic, spurring concerns of a stock market crash. Real estate purchases also have been motivated by the fact that foreigners can make more money in rents or increased value in the United States than at home. For the Japanese especially, U.S. real estate is going for fire-sale prices.

Compared with Tokyo, Manhattan and Los Angeles look cheap, which may explain why Shuwa and other Japanese real estate and insurance companies have paid more than top dollar recently for the Tiffany and Co. building, the Exxon headquarters and others. Earlier this month, Citicorp announced it would sell parts of two headquarters buildings to Japan's Dai-ichi Mutual Life Insurance Co. for $670 million, the highest price ever paid for Manhattan real estate.

"In Japan there are very few interesting properties available," said Kensuke Tanaka, owner of a Tokyo real estate company. "L.A., Hawaii, Vancouver, New York -- such real estate is quite cheap in comparison to Japan."

Today, it is estimated that British, Japanese and other foreigners own nearly half of the downtown office space in Los Angeles, more than 15 percent in Atlanta, Denver, San Francisco and Miami and more than 10 percent in Washington, D.C.

The splashy real estate purchases, along with a few high-profile business takeovers, such as the recent purchase of book publisher Doubleday & Co. Inc. by a West Germany media group, are in fact only a small percentage of total foreign investment in the United States. But they are the most visible and have sparked concerns about foreign investment in general.

In Hawaii, where many hotels, country clubs and businesses have been purchased by Japanese and other foreign investors, newspaper stories and radio shows on the subject abound. "There really are two different sides to the issue: There is the view that investment is good for the economy. But there is some fear that Hawaii will become a colony. And there is some concern that the investment doesn't benefit the community at large," said an aide to U.S. Sen. Spark M. Matsunaga (D-Hawaii).

"I think there certainly are negative implications," said Kenneth B. Pyle, a University of Washington professor who has examined the issue. When a foreign company buys a U.S. firm it may help employment, but very often "the most desirable jobs are probably not going to be here," he said.

Despite these worries by some, the traffic of state governors, mayors and others to foreign capitals in search of investment shows no sign of abating. And the flow of foreign money into the United States is unlikely to slacken anytime soon, experts say.

Robert J. McCartney of The Washington Post Foreign Service and special correspondent David Fouquet contributed to this story.