Colliers International has reported that Asia’s property sector has been driven by economic growth and low real interest rates.
Higher trade flows and e-commerce will continue driving industrial and logistics property in China, Hong Kong, Singapore and India, with industrial property emerging as a key organised asset class across Asia.
Risks to this sector include a financial downturn affecting equity and bond markets, as well as reduced demand for leased central business district office space from large financial tenants due to faster-than-expected adoption of artificial intelligence and any subsequent workforce reduction programmes.
Forbes’ ranking of the top 10 Asian cities for real estate investment in descending order are Singapore, Shanghai, Hong Kong, Beijing, Guangzhou, Ho Chi Minh City, Tokyo, Taipei, Jakarta and Kuala Lumpur.
Bangkok still offers decent value for money
Experts, however, point to a range of advantages which bolster Bangkok’s reputation as a safe and stable place to invest.
Bangkok’s property market enjoyed strong growth in the first quarter of this year, led by a 35 per cent jump in the number of condominium units released in Bangkok from the year-earlier period.
Some 14,600 units were added to the market in the capital for the quarter, said Surachet Kongchepp, a property market researcher with Surachet’s research showing that up to 66 per cent of the condominium launches are near mass transit systems.
Analysts also point to the absence of punitive stamp duties for foreign nationals such as those found in Singapore and Hong Kong and the liquidity of developers and the selectivity of banks in approving mortgages as positive indicators
Several trends emerging in Asia
Excess liquidity, where local sovereign and institutional funds are increasing their investment in property, is increasing the competition in assets.
This in turn increases the competition in value-add space, shared workspaces and previously less focused asset classes such as data centres, affordable housing projects, build-to-rent (or co-living) facilities, and student and senior housing.
Logistics assets remain the leading asset type due to Asia’s long-term structural undersupply.
Vietnam and India are top investment destinations due to expected high economic growth. China, the biggest source of regional property investment outflows, has experienced regulatory restrictions, particularly in Australia.
Sydney and Melbourne continue to offer significant rental growth while Tokyo still offer high yields. Singapore, which had hit the bottom on office and residential sectors, has seen renewed investor interest and is currently south-east Asia’s hottest property market.
More manufacturers to relocate from China to Southeast Asia
JLL anticipates the trend to accelerate as the China-US tariff war are driving more companies in China to relocate their operations to other countries to avoid US tariffs and maintain their competitiveness.
Bangkok, 11 July 2019 – More manufacturers have relocated from China to Southeast Asia over the past few years largely because The Red Dragon’s labor costs have become less and less competitive. This trend has been reinforced by the China-US trade war that began in 2018.(more…)
SET up 6.8% at end of June, highest performer in Asia
The Set is up 10.6 per cent from the end of 2018 to 1,730.34 points and SCB Securities thinks the Thai stock market may now rise to 1,750 points.
High-speed rail project to link three airport to be signed next month
Contracts to link three airports and the Map Ta Phut industrial port development project expected to be signed between state firms and private concessionaires next month.
The Eastern Economic Corridor Policy Committee has acknowledged progress in the high-speed rail project to link three airports and the Map Ta Phut industrial port development project.
Contracts for both projects are expected to be signed between state firms and private concessionaires next month.
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