Investing in the Asia Pacific Region
A leading market research provider has announced their findings for investment trends in Quarter 3 2016:
- The volume of transactions increased by 5.6% quarter on quarter to USD$24.6 billion. This was due to improved market confidence underpinned by the stabalisation of bond and equity markets and low interest rates.
- Market activity was mainly at both ends of the spectrum; there were a few large transactions worth over USD$500 million and then numerous smaller sized deals below USD$100 million. Australia and Japan continued to be the key destinations for foreign investors with 55% of cross border investment.
- The total 2016 transaction volume is expected to reduce as activity in quarter 4 is very unlikely to be on par with the same period last year.
- The price gap between the sales price and what people can afford is likely to continue and therefore the level of investment activity will be affected. Due to low interest rates landlords are not under pressure to sell as rents are easily covering any mortgages. Landlord yields are expected to remain flat.
- Analysis on Thailand showed investors are looking for income producing property and land prices continued to rise even though the economy is weak. Buyers from overseas remained keen to form joint ventures with domestic developers on a project by project basis. Japanese groups are particularly interested and condominiums continue to be of the most interest.