Jul 18, 2014

    Take your pick of overseas properties

    MORE Singaporeans could be investing their money in real estate overseas, following last year's cooling measures for properties here.

    Many overseas developers are opening property galleries or sales offices in Singapore to step up their marketing efforts here.

    While those looking to invest in properties abroad could make handsome gains, there are a number of things they should be mindful of, said experts.

    Nicholas Mak, head of research and consultancy at property consultancy SLP International, said that investors should be aware of the rules and regulations in the country they are investing in, and familiarise themselves with the market first.

    Lee Lay Keng, head of research for South-east Asia at real estate consultancy DTZ, said that regulations abroad were different from those in Singapore.

    "So, (investors) need to be aware of rules regarding the property sector, such as whether they can exit the market and any restriction on who they can sell it to," said Ms Lee.

    "The track record of developers is also important."

    Vincent Tan, head of the Singapore office of Malaysian real estate developer Mah Sing Group, agreed.

    He said: "When it comes to property investment, some would say location, location, location…However, one key factor to look out for would be the developers behind the projects and their track records.

    "Investors should also look at the potential growth story of the country and location they are investing in."

    Another thing to note is interest rates.

    Ms Lee warned that they could be different from Singapore's rates.

    "There are a lot of things to consider, especially if you're taking a loan to buy the property, because your profit may be less if you weigh in the financing costs," she said.

    Mr Mak added that there was also a currency risk to watch out for.

    "The exchange rate can substantially reduce the returns in the buyer's home currency," he said.

    He noted that overseas investments could potentially yield high returns, but there were higher risks to consider as well.

    Those who are more risk-averse can consider buying locally, but some basic rules still apply, such as location, the developer's track record, and the development's unique features, such as its eco-friendliness, or facilities such as an infinity pool.

    If a development has a feature that others do not have, it could very well add to the property's attractiveness and, thus, resale value.

    Mr Tan said: "It depends on the features, but a unique feature can make a positive impact and make the development stand out."