Category: Swhengtee News
Published: Tuesday, 18 December 2012 13:51
GAMECHANGER: The rules of the game have changed as governments play a bigger role to attract foreigners to invest in their countries’ real estate via special economic zones
Source : New Straits Times (RED)
Tee … previously, developers ‘create hotspots’.
From 2013, governments worldwide will play an increasingly bigger role in the property market through the setting up of special economic zones which will determine where a country’s property hotspot is, says Gavin Tee, an international property consultant and speaker. “In the past, all property prices were led by the market followed by developers, Tee said, citing the examples of Sunrise Berhad, which is credited with developing and driving demand for the Mont’ Kiara enclave, See Hoy Chan Sdn Bhd with One Utama and Sime Darby Berhad with USJ.
“These developers ‘create’ hotspots,” he says during an exclusive interview with NST RED recently. “But in 2013, around the world, governments are taking the lead by setting up economic zones which offer the market a bigger opportunity,” he continues, adding that people are starting to look at government policies and analysing the economic zones of each country when deciding which property hotspots to invest in.
Saying that the whole world is now competing with each other to build up their economy to attract foreign investment, many governments as a result are building special economic zones which come with many incentives as part of their strategy to attract international investors.
For example, Brazil will build an estimated six million properties within the next 2–4 years while the German government, through several incentives, is welcoming foreigners to invest in guaranteed return investment schemes that refurbish listed properties in Germany. Bangladesh and the Maldives are going down this road too. Spain which has a huge overhang of properties following the collapse of its real estate market in 2008 is in the midst of finalising plans to offer permanent residence to foreigners who purchase properties worth over USD200,000 (RM600,000).
“These are the best locations to invest in next year as the potential for property price appreciation is very high,” observes Tee. “In particular, if the zone can attract many Multinational Companies (MNCs), it will be very sustainable and will be able to survive the world’s economic instability,” Tee points out, citing the example of Cyberjaya and Iskandar in Malaysia, and Shenzhen, Laos and Jakarta overseas.
Shifting flows of investment
As a result, property investment will undergo a game-changing shift in 2013 across the world, the international speaker who is also the Founder and President of SwhengTee Real Estate Investment Club says.
During this shift, international investments will start pouring into cheaper destinations such as the Southeast Asian region. Already, nearly one third of garment manufacturers in China are relocating their production to cheaper destinations such as Vietnam, Indonesia and Malaysia, with Germany and Japan also favouring these three countries especially Malaysia.
Within Indochina, Laos and Myanmar of late are starting to attract many international investors. In an effort to pull foreign investment into their country, the Lao government has approved the setting up of 25 special economic zones while Myanmar is globalising its property market. South Korea and surprisingly even North Korea may set up special economic zones and invite foreign investors to participate.
In Malaysia’s case, we already have several successful models of special economic zones such as Iskandar Malaysia, Cyberjaya and Greater Kuala Lumpur. The biggest beneficiaries of these economic zones are property investors and foreign buyers, Tee stresses.
“When foreign investors start coming in a big way, the immediate beneficiaries will be local property owners and investors,” he observes.
Describing this as “The changing face of the real estate world”, Tee will speak more on how and where to invest to take advantage of the shift in international real estate focus towards Southeast Asia and economic zones in a one-day seminar on 19th January 2013. To be held at PWTC (Putra World Trade Centre) in Kuala Lumpur, the programme will also be offered in Chinese on 20th January.
The seminar will include an investment programme where Tee will talk about strategies on how to “buy tomorrow’s property at today’s price”, as well as his forecast for 2013.
New Straits Times and NST RED are the official media partners for the event.