Safety in times of turbulence; Singapore real estate

Many of my friends told me that foreigners / international companies would stop investing in Malaysia SOON. They have lost all confidence with Malaysia. Malaysia has gone back to capital control and this has made everyone scared. I disagree with all three statements but I guess they have the right to issue statements supporting their beliefs. As for me, I still think all the international rating agencies are right for putting Malaysia under the ‘Investment’ grade. I also believe all the analysts and economists who are still predicting a better 2017 compared to 2016 in terms of GDP growth. I also believe myself because I continue to look at good stocks to buy and hopefully a secondary property in 2017. Yes, I have recently started to invest in startups too under the equity crowd financing.

As for my friends, perhaps they can think about investing in Singapore. Nope, not my personal advice but this is based on a report in which revealed that Singapore is seen as a safer investment destination in a turbulent world today. In fact, three countries stood out as their biggest real estate investors in Singapore. They include Qatar (Asia Square Tower One deal), Malaysia (Central Boulevard land) and China (Qingjian Realty’s two deals in Shunfu Ville) and Bukit Batok. . This is what Christine Li, the research director at Cushman & Wakefield said, “It could be due to global market volatility as a result of Brexit and the oil and gas sector. Foreign investors see Singapore as a defensive play where investment is fairly protected due to the strength of the Singdollar.”  (Hopefully SGD continues to remain strong because these few weeks have seen it moving downwards versus the US$)

The interest is with commercial properties because according to Jeremy Lake, executive director for investment properties at CBRE Singapore, “Over the next three, four years, there’s… very little new office space being completed… The more forward-looking investors are looking at that period of little supply, which will then result in rental growth.” (This is indeed good news right but I think better also look at the state of the economy. If it’s growing vibrantly, then everything should be just fine.)

Of course, everyone should note three important things when we are investing overseas. Our familiarity with the foreign market is definitely lower than in our homeland. Secondly, buying overseas property is for the purpose of hedging? If yes, perhaps can also think about listed companies instead. It’s easy to get into and get out should circumstances change. Third, all these would depend on how that foreign country fare. Read more, understand more. If the growth is continuing, then it’s a good buy. However, if majority of analysts (not the Facebook ones) are saying the same thing, whether positive or negative, we must take note. Happy investing yeah, especially in more stable markets.

written on 23 Dec 2016

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