Saturday 1 March 2014

Asian Cities Real Estate Face Dual Whammy of Rising Interest and Oversupply

Bangkok, Manila, Shanghai, Beijing, Singapore. Iskandar, Kuala Lumpur, Jakarta, all have something in common: because they escaped the Global Financial Crisis relatively unscathed, their developers continue building plans unabated. Therefore supply must necessarily catch up with demand by now.

If you don't buy right smack in the middle of the city or in the inner suburbs, when new home completions surpass demand, rents will fall.

From 2015, I'm expecting interest rates in the US to trend up. The toxic combination of falling rents and rising rates will cause price correction to accelerate.

The best time to refinance your property is when rates are low. We will probably need to wait for the next recession to see that.