How to Invest in Asian Property

With the American housing market declining, investors are becoming more global. One global investment, the Asian property market, will continue to rise for a few more years. Asia has a healthy economic forecast, property markets are becoming more accessible to investors and some countries have changed restrictions on foreign investments. Read on to learn how to invest in Asian property.

Difficulty: Moderate

Instructions

1. Decide which Asian country you want to target for investment. For example, Japanese office and retail property looks good, and rental growth should continue to be strong. Even though urban land prices have doubled in India since foreign investment opened up a few years ago, real estate there is still a deal. Thailand has a young generation with an untapped investment market. Property is inexpensive.

2. Research your chosen Asian market. Find out the country's rules and regulations for foreign investment. Every Asian country has different regulations, but most are interested in easing the way for investment.

3. Find an international real estate agent or broker who is knowledgeable about the Asian market you are interested in. This is particularly important if you will be conducting negotiations in another language.

4. Consider an international real estate fund. This provides diversification for your investment portfolio. These funds currently have low minimums and this way investors can take advantage of the property growth in Asia. Ask your financial adviser about the Asian real estate mutual fund, Cohen and Steers Asia Pacific Real Estate Securities.

5. Think about a REIT. Real estate individual trusts, also known as real estate stocks, may be a good investment. The Asian REIT market is growing rapidly. Since 2003, the market expanded by 800 percent in Singapore, 500 percent in Japan and 1000 percent in Hong Kong.

Tips & Warnings

• A declining dollar helps U.S.-based investors because investments in foreign currency such as the yen translate into more money when the dollar declines.
• In fast-rising markets, buy cheap so you can sell at a profit. In China, for example, urbanization has pushed the rental and capital values up. Rents rose 50 percent last year for some tenants in Singapore.