Compass Real Estate > Cambodia Real Estate Information > Exclusive > Is It a Wise Choice to Allocate Overseas After Post Epidemic?

Is It a Wise Choice to Allocate Overseas After Post Epidemic?

2021-06-02
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Summary:In an era of inflation and skyrocketing global property prices, investors from all over the world are scrambling to find better ways to allocate their funds, and real estate remains one of the best options when security and appreciation potential are taken into account. Therefore, what is the prospect of overseas property? Is it worth investing in?

Recently, Compass Real Estate Platform has released an article called " Global House Price is Sky-Rocketed! When is the right time to buy if you only need it for self-occupancy? ", and after the post was shared, we received questions from several netizens because, in their opinion, the epidemic is seriously heavy, which could cause a lot of people to be without money, so how can house prices have soared?!

In this regard, our website can only advise you to read the most recent news from all angles.

Of course, some netizens also see the key points:

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Yes, according to World Steel Association data cited by CCTV finance and economics, China's steel price index has risen 23.95% since the beginning of the year, while the international steel price index has risen about 57.8% in the same period.

In fact, due to anticipated inflationary pressures, the prices of grain, crude oil, gold, iron ore, copper, aluminum, and other means of production have risen dramatically since February.

Just as we know, steel is an important raw material in the real estate industry. Then, since the price of steel is rising, the price of the properties is rising as well. It is a reasonable prospect.

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Actually, the reason we mentioned how house prices are rising today is not to denigrate the environment, but as someone who has worked in this field for many years, we simply wanted to share what we have learned from the most recent information and some humble opinions.

Well, let's get back to the point. This article is intended to analyze overseas real estate in the late epidemic era.


What are the advantages of investing in overseas property?

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In an era of inflation and skyrocketing global property prices, investors from all over the world are scrambling to find better ways to allocate their funds, and real estate remains one of the best options when security and appreciation potential are taken into account. However, the overseas property is favored by the way that the investor is not just going to invest all in just one type of real estate.

In fact, overseas real estate in recent years is becoming more and more popular, not just only a single factor, but also the result of the joint action of various factors.

Firstly, the main concern of investors is the problem of rental yields.

Generally, the rental yields of overseas property are very high. According to the survey of Compass platform data, some countries even have total rental yields of more than 10%.

Let’s be honest, facing this high type of rate, it is natural to attract the public to invest in it.

Secondly, the advantage of resources.

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The distribution of overseas real estate such as education, medical care, and culture is relatively balanced, which makes this meet all the needs.

For example, in the education aspect. Students have accepted multi-culturalism since their childhood under the terms of the international education system, which has also made their vision more open. With the simultaneous improvement of materialistic and spiritual needs, an increasing number of parents are sending their children abroad to receive high-quality international education.

As per the reason for children receiving abroad education,

For example, in terms of education, students who have accepted multi-culturalism since childhood have a more open vision. Under the double improvement of people’s materialistic needs as well as the spiritual, more and more people are sending their children abroad in order to receive a high-quality international education.

At the same time, as for children receiving overseas education, foreign real estate has become a necessary choice for parents.

Invest in real estate when children go overseas, or buy overseas houses in advance to pave the way for children.

By using the advantages of the appreciation of the house or the rental return value, parents could easily reduce the cost of their children’s school fees and some can even earn higher income instead.

Besides, most overseas properties have the natural advantages of permanent property rights. The down payment, which is generally lower with a down payment of a 10% or even 0 down payment, is more common. Moreover, the whole process of purchasing an overseas house by lawyers also provides better legal protection for the real estate owners.

Whether it is the advantages of the unique characteristics which are given by the overseas investment environment or either overseas houses' advantages, all are the causes that made overseas real estate popular.


What is the change in the overseas real estate market in this post epidemic?

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(Phnom Penh Popular Property~Romduol City)

Over the past year after the epidemic spread, people's investment concepts have a certain level of change.

Before the outbreak, people allocated overseas mainly just to focus on immigration, studying, or vacation.

After the outbreak, people found that owning a house overseas is a haven to prevent the unexpected, and also purchasing property can also be used as a place for their elderly care.

Meanwhile, overseas real estate has gradually shifted from the short-term and excessive profit investment to a more rational long-term investment, which aims at long-term holding and rent collection.

Under such a transformation, the overseas property will also be eased, and the property market will be more stable as well.

Besides, the investment hotspot also has considerable changes.

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Earlier, the United Kingdom, the United States, Canada, and other European and American countries were the preferred countries for investors. But in recent years, the heat of these countries has gradually faded, and investors have started to focus on Southeast Asian countries such as Singapore and Thailand instead.

What is the cause of this change? According to Compass Real Estate Platform, this is since most European and American countries are developed, which has resulted in their real estate industry is relatively mature and has already passed a period of significant value-added, so the property there has primarily maintained its prices. On the other hand, most Southeast Asian countries are developing countries. The maturity of industry development is not yet enough, so the value-added space is still wider. In contrast, it is also the reason why the real estate market in Southeast Asia is in the spotlight.

In addition, the last change is obvious. Before, the overseas real estate market was the world of famous businessmen. In contrast, more and more middle-class people are becoming interested in it, and the average age of those investors is younger than ever before. In the Southeast Asia market, the total price of houses is relatively low. The investment threshold here is also lower, which made it more suitable for the middle class to start.


Is it appropriate to allocate overseas property at this time?

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(The demographic dividend of Cambodian)

Since overseas real estate has many advantages and development there is also becoming more and more stable, so is it wise to allocate overseas real estate at this time?

Before answering this question, we hope that you can understand what questions need to be considered to achieve the ultimate goal of overseas real estate investment, maintaining or even increasing the value.

In the industry, two questions that are usually being asked are whether a property is worthy of investing, one is Rent for who? Other one is Sold to who?

The high rental yields of overseas real estate are the key point of investment. We must have a comprehensive understanding of the local real estate market before the fork out, especially the rental market.

For example, learning about the external population's situation and the proportion of urban employees would be extremely beneficial in determining whether the area's tenants are stable and have a sustainable power to provide rental housing.

Sold for who, this question is the way to consider who will receive the offer in the future.

For this question, the population is still one of the factors to be considered. For example, if a region has a large proportion of young people, the future of the housing market will also have a certain potential development.

Another consideration is the economic level and development of the local areas.

If there is a clear answer to the question of whom to rent and sell, then the property must be worthy of investing, and "when" is no longer the key factor that hinders real estate investment.

Investment is different from self-reliance. Investment is a long-term process and will also have a linkage effect. For those who are qualified, reasonable allocation of overseas real estate is indeed an effective way to invest and finance. As for whether to choose the value-preserving area or value-added area, it is according to your own opinion.

Source: Compass comprehensive arrangement


Editor: Sunnie         Translator: Thangnyth         General in Chief/Executive Producer: Nicole

 Compass global site: Cambodia | Singapore | UAE | Thailand | Philippines | Myanmar | Laos

  • ---------------------------------- The End ----------------------------------

Disclaimer: The re-forward articles on Compass website are for the purpose of conveying more information, and it does not mean that the Compass website agrees with its views or confirms the authenticity of its content. Article noted as "Source: Compass original", please note that the source from Compass. The content of the article is for reference only and should not consider as investment advice, and it does not mean that Compass agree with its views.

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