TheromanticdreamofowningasecondpropertyinatropicaldestinationcaneasilyberealisedinSouth-EastAsia,wherepropertyisstillveryaffordableandthereisarangeofglamorouslocationstochoosefrom.
Thisareaoftheglobeisperfectforwintersunseekers;however,aswithalltropicallocations,humiditycanbeanissueandeachdestinationhasaprolongedrainyseason.ThebesttimeofyeartovisitThailandandCambodiaforcooler,drierweatherisgenerallyNovembertoMarch,whilevisitorstoMalaysiawillgetlessrainfromApriltoOctober.
Alloftheseemergingmarketsofferlifestylesandpropertymarketsashotastheweather,sogrababeachsideseatwhileyoucan.
PropertyinCambodia
Nowshakingoffofitstroubledpast,Cambodiaisimitatingthesuccessofneighbouringcountriesandhasseenenormousgrowthrecently,whiletourismhasrocketedwiththreemillionvisitorsexpectedtobearrivingannuallyby2010.AllofwhichmeanstherehasbeenarushfrominvestorskeentogetintopropertyinCambodia.
RoryHunterofdeveloperBroconsaysthekeylocationtobuypropertyisinPhnomPenh,thecapital,withitselegantcolonial-eraavenuesandriversetting.“PhnomPenhisthehotbedforinternationalinvestors,asthereareapartmentswitharelativelylowentrypricepoint.”Heisn’tasconvincedthatothertouristdestinations,such,asSiemReapandSihanoukville,arerightforindividuals.“Whilethereisconsiderabledevelopment,these[areas]don'tofferaneasywayin.”
Theelegantcapitalisamixofcharacterbuildings,manyofwhichhavebeenrefurbished,andswankynewapartmentblocks.PhnomPenhpropertypricesrangewidely,dependingonlocation,styleandage,withtinyapartmentsinneedofrefurbishmentinlesssought-afterareascostingfromaround£30,000andsmallvillasfrom£50,000,withanythinglargerorrenovatedfrom£100,000.
DavidStanleyRedfern,currentlysellingapartmentsinPhnomPenh’sposhFrenchquarter,claimsthere’sarushtobuyPhnomPenhproperty,partlyspurredonbyincreasedinvestmentininfrastructureandtourism.“Naturallythishasmadepricerisesastronomical,”hesays.Redfernputsannualappreciationat15to20percentbutsayspropertypricesarestillclimbing.“It’slikelythatpriceswillsoongetsilly,”headds.
Thismeansrentalyieldsarenotaslucrativeasyoumightexpect.Redfern’sdevelopmentcomeswithaninepercentrentalguarantee;however,theGlobalPropertyGuideclaimsreturnscanbeaslowas4.6percent.
RoryHuntersaysCambodia’sislandsarealsowheremainstreaminvestmentisheaded.Broconisoneofanumberofcompaniesintheearlystagesofluxuryresortprojectsoffthecoast,althoughthereiscurrentlylittleinthewayofinformationaboutpotentialproperties.
Propertybuyersarealsoattractedbytherelaxationoftherulesonforeignownershipandlawsforcingdeveloperstoofferbuyersfinancialprotection.ForeignersmayownpropertyinCambodiaabovethegroundfloorinapartmentbuildingsbutnotland,whichcanonlybeownedviarenewableleaseofupto99years.It’spossibletosetupacompanythroughwhichtoownbuttwonationalsmustbedirectorsofthecompanywiththeforeignbuyerholdingthemajorityshare.
WithinterestinCambodiapropertyontherise,gettingyourfootinthedoornowmightbeasensibleoption.
PropertyinThailand
ThepastfewyearshasseenThailandbecomefirmlyestablished,withpropertybuyerspilingintocoastalandcitypropertyinThailand,attractedbyaverageannualappreciationoftenpercent.
CosmopolitanBangkokpropertyhasbeenahitwithbuy-to-letlandlords,hopingtocashinonrentalyieldsofaroundsevenpercent.However,thosewhowantasun-drenchedsecondhomewithpotentialforrentalarechoosingcoastalresortssuchasPattayaandHuaHinorpopularislandssuchasPhuketandKohSamui.
HenriYoungoflocaldeveloperRaimonLand,whichoffersluxuryprojectsinallthemaindestinations,saysThailandpropertymarketisstillboomingdespiterecentpoliticalupheaval.“Many[buyers]realisethat,attoday’sprices,buyingpropertyinThailandstillrepresentsexcellentvaluecomparedtootherresortdestinations,”hesays.“Thailand’spropertymarketforforeigninvestorsremainsincrediblyresilientandwefindmostprudentinvestorsaretakingalong-termview.”
JayWalker,ofeco-developmentTheVillageonCoconutIsland,nearPhuket,agreesthattheappealofThailandisstillverystrong.“TourismisincreasinganddemandforpropertyinThailandisgrowing,”hesays.“TherearestillbuyerswantingprimeThailandpropertyasaninvestmentandholidayhome.”
Walkerisofferingasevenpercentguaranteedrentalyieldonhistwo-tofive-bedroomvillas,pricedfrom£302,950,andsaysownersinmostresortscouldexpecttogetbetweensixandeightpercent,thoughheanticipatesreturnsnearerto12to15percentintime.
AlistairPowellofSevenContinentInvestment,whichismarketingpropertyinPattayafromunder£50,000,addsthatThailandoffersnotjustlifestylegainsbutfinancialincentives.“TheentrylevelforpropertyinThailandissignificantlylower,thaninmoreestablishedEuropeanlocations.Furthermore,there’snocapitalgainstaxforprivateinvestors.”
Themainissueforoverseasbuyersisthelackofabilitytoownlandfreehold,thoughtherearewaystogetroundthis.Oneistobuyanapartmentinadevelopmentinwhichforeignersareallowedtobuyupto48percentofavailableunits.Theotheristobuyviarenewable30-yearleases.It’smorestraightforwardtoowninThailandthanitseemsand,foratasteofparadise,maybewellworththeextraeffort.
PropertyinMalaysia
TheMalaysiangovernmenthasbeenactivelyencouragingoverseasinvestmentviaitsMySecondHomeschemeforseveralyears.Theinitiativeoffersarangeoftaxbreaksandvisaoptionstoprospectiveresidents,andwithstunningcoastline,world-classhealthcareandeducation,plusluxurypropertyinMalaysiacostingfromunder£100,000,it’snosurpriseinvestorshavebeguntopourin.
Afairnumberofbuy-to-letinvestorshavebeendrawntopropertyinKualaLumpur,thecapital,whohavebeenkeentoownapartmentsfromaround£80,000andfamilyhomesingatedcommunitiesfromaround£200,000,thoughthemaindestinationsforbuyingpropertyinMalaysiatendtobecoastalresortswithinanhourofthecity.OneofthemostpopularispropertyinPortDicksonwhereapartmentsstartataround£45,000andwatervillasfrom£80,000,whilethetropicalislandsofPenangandLangkawiarealsokeydestinationswithpricesstartingataround£600persquaremetre.
TheSepangGoldCoast,inparticular,isdrawingpropertybuyers,duetothenewF1circuitandtheGoldenPalm,alarge-scaleresortdevelopmentthat,whencomplete,willincludenumerousleisureandretailoptions,watervillasandseveralshorelinevillages,withpricesstartingataround£70,000.
“Malaysiaisaveryniceholidaydestinationwithenormouspotential,”saysAlistairPowellofSevenContinentInvestment,whichiscurrentlysellingontheSepangGoldCoast.“Italsohasoneofthefastestgrowingeconomiesintheregionandpricesareappreciatingwell.”
WithaverageappreciationinKualaLumpuroftenpercentandasmuchas14percentonthecoast,andrentalyieldsatahealthysevenpercent,Powellsayshiscompanyisseeingmanybuyerskeento“getinatanearlystage”.
ThecountryalsoofferswhatJohnScottofAssetPropertyBrokerscalls“oneofthelowestcostsoflivinginAsia”.Scottalsopointsoutthatit’seasierfornon-nationalstoownpropertyinMalaysiafreeholdoronleasesofupto99years,whichismorefavourablethanpropertyinThailand.“Malaysiaticksmanyboxesforbuyers,”hesays,“it’sasafe,stablecountryandasuperblocation.”
FirstpublishedinDecember2008.
Someinformationcontainedwithinthisarticlemayhavechangedsinceitwasfirstpublished.HomesOverseasstronglyadvisesyoutoseekcurrentlegalandfinancialadvisefromaqualifiedprofessional.
See Also: Thailand (4), Cambodia (2), Malaysia (7)
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