In Australia, we are seeing additional foreigner levies being considered or implemented by all the major cities as well as tighter lending conditions. Across Hong Kong and major cities across China, we are seeing mortgage tightening measures where buyers have to come up with as much as 60% deposits.

Debt servicing ratio is also being targeted in an effort by governments to prevent over-leveraging with Singapore setting it at 60% over-leveraging 40% of income, down from its previous 50%. Similarly, Malaysia has implemented borrowing constraints, minimum price points for foreigners and additional taxes to regulate its market.

Top 10 strategies on How to become a wise property investor. Click here for more details

One can arguably deem that the restraints are necessary only because real estate continues to be the one asset class that has the best risk reward ratio. We tend to agree with that, given the level of risk in the equity markets presently, and the mix of potential market woes including China’s slowdown, anticipated rate hike in the U.S., the oil crisis, Brexit and global terrorism. Any one of these dozen or so risk events can send the markets reeling back to the crisis state of 2007/08.

On the other hand, the low-interest rate environment around the world continues to favour real estate investments. In a survey by Colliers of more than 600 significant investors, over 52% concluded that they will increase their allocations for real estate in 2016. Los Angeles, San Francisco and New York are the darlings of U.S., while London is preferred in Europe followed by Paris and Frankfurt. Japan and Australia top the list for Asia with Hong Kong, China and Singapore close behind.

We have to admit that the mixture of risks and opportunities is somewhat a confusing cocktail for investors. While the current market does offer a plethora of opportunities, each must always be researched and carefully managed. Real estate remains our favourite instrument to help our clients achieve sustainable wealth and one which we believe will outperform the other instruments, especially in these turbulent times when bought correctly.

PROPERTYGURU