Hot spots abroad for property investors

Hot spots abroad for property investors

Analysts can trumpet the benefits of shares, bonds and other investment products till the cows come home but Singaporeans still like to put cash into boring old bricks and mortar.

That's been the case for decades but the big difference now is that foreign fields are looking more fertile than our own patch.

Surging prices on the one hand and tough cooling measures on the other have prompted many local buyers to eye property overseas.

4 hotspots abroad for property investors

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    Artist's impression of Arya Residences in Manila, Philippines. It is designed to be eco-friendly and is located at McKinley Parkway in Bonifacio Global City, a new business district.

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    Factor in rental yields of 5 per cent to 7 per cent, low interest rates, and an inflation rate of about 3 per cent and you have a highly appealing market.

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    Be mindful of local policies and regulations. Foreign buyers can own the units outright so long as the condominium as a whole is not more than 40 per cent foreign owned.

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    Artist's impression of Weltz Residences at Sukhumvit Road in Bangkok, Thailand.

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    The prices are more affordable than in Singapore. A one-bedroom apartment in downtown Bangkok can be had for about $200,000.

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    Be mindful of rental contracts in Thailand that typicaly last for two years. You should also ensure that the freehold property is registered in your name. Also, make sure the yield is in line with Bangkok's market, which is now as high as 5 to 8 per cent.

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    Artist's impression of 375 Kensington High Street in London.

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    The exchange rate of the Singdollar to the pound has effectively cut the purchase price of central London properties by up to a third compared with 7 years ago.

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    Investors should look out for rental yields of 4 to 5 per cent and strong prospects for capital growth and appreciation.

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    Artist's impression of Skye by Crown. It is a 20-storey mixed development with 232 apartments in North Sydney.

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    Interest rates have been declining for the past year and are tipped to fall further with mortgage rates now starting at around 5.5 per cent.

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    Buyers are encouraged to get guidance from a tax or mortgage adviser. In addition, there is a tiered stamp duty of between 3.5 and 5.5 per cent when the property is sold or transferred.

Buyers are finding themselves spoilt for choice with increasing numbers of property roadshows calling in here from overseas, dangling lower prices and higher rental yields.

But there are plenty of pitfalls out there for the unsuspecting buyer, so there is a lot to know before you throw thousands of dollars into a foreign country.

Financing is one such area. While Singapore banks may provide loans for property in established markets like London, buyers will still be exposed to currency risk.

The sharp fall in the Australian dollar in recent weeks, for example, may well have caught out some borrowers.

We look at some cities in two established property markets - Australia and Britain - and two up-and-coming ones - the Philippines and Thailand - to see why they make good investment choices.

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