Asians big fans of hard assets

Property and gold are popular investment choices in Asia-Pacific thanks to the region's love of hard assets, a recent annual survey reveals.

The Wealth Report 2010 Attitudes Survey, jointly prepared by the real estate consultancy Knight Frank and the wealth management firm Citi Private Bank,shows property accounts for one-third of the investment portfolios of wealthy individuals. More than 70% of respondents believe this year is a good time to invest in property, with half predicting residential property will be the sector's top performer.

Europeans were the biggest property enthusiasts, where this asset made up almost half of their investments. South Americans were the most reticent, with the property accounting for a little over 10% of their entire investments.

Equities made up a quarter of the respondents' investments, with cash and bonds the third and fourth most popular investments at 17% and 13% respectively.

The global and regional survey showed that property is the preferred investment choice in most regions, but Asian's are still drawn to gold more than other investments such as equities, while gold only accounts for a 0.5% share of the average investment portfolio of wealthy individuals elsewhere.

Quek Kwang Meng, head of real estate investments in the region for Citi Private Bank, says investors in Asia-Pacific prefer tangible assets.

The report shows that prime property prices in Asia-Pacific countries have changed significantly since the economic crisis from a 40% contraction in Cambodia to 5% growth in Thailand and 20% in China.

The report forecast growth of the region's prime property prices this year will range from a 10% slump in China to a 20% rise in Singapore.

In Thailand, prime property prices could increase by 5% to 10%. Bangkok remains the only city in the country to have a developed urban luxury market,while Phuket is the place investors go for top-end holiday villas.

The report says the average price of a premium Bangkok condominium is 176,000 baht per square metre and a Phuket luxury villa costs 108 million baht.

BANGKOK POST