Wednesday, February 1, 2012

The Buyers vs Sellers Standoff!

Hi Guys! Gong Xi Fa Cai!!!

I have done so many countries in the last month that I lost count. I just got back from Seoul, its negative 11 degree Celsius over there but work comes first. The year is evolving and is becoming more interesting on the property front. Even as the European situation and the latest round of government cooling measures have dampened the mood a bit, property buyers are keeping up the tempo. The Waterfront in Seng Kang shows that demand is still there.

In my previous entries, I have shared with you that I do not share the same level of pessimism as the analysts out there when the government introduced the most drastic measures to curb property prices and I have been spot on. The analyst who predicted a 30% fall must be feeling a little sore right now. Its true that market activity has fallen but prices have scarcely faltered. On the contrary, commercial property has rode from one crest to another. This is simply music to my ears as the bulk of my money is there now.

What of the future? The key to watch is the interest rate environment, we are in a prolonged period of negative real interest rates. Inflation is stubbornly high and Uncle Sam has committed to lower interest rates till 2014. Ben Bernanke is a smart cookie by laying the foundation of a stable predictable financial environment to encourage businesses to invest and promote economic growth. As long as rates remain low, real estate holders have no incentive to divest.

However, don’t expect to reap big returns as prices will be limited by possibility of more cooling measures. It’s a true test of wills here. However, with limited investment options by the general population, liquidity and funds must invest somewhere. In the absence of other options, its still going into real estate.

I will be sharing more with you at my Asian Titan Trends event. This year, the event will be held at Suntec City on the 3rd of March. I will be sharing with you my perspectives of the current investment climate and which sector offers opportunities. The biggest venue we can secure is a 500-seater hall so only the first 500 who register can enter. Entrance is complimentary for students but please do not waste seats. We are contemplating banning people who register but do not turn up. So register quickly.

It’s the year of the Water Dragon and let’s not let this mythical creature temper our enthusiasm.
Let’s HUAT AH!

Your Friend,
Andy Ong