Released on = December 5, 2006, 12:07 am

Press Release Author = Prince Cruz / Global Property Guide

Industry = Real Estate

Press Release Summary = Asia\'s real estate markets seem to have recovered from the
Asian crisis and to be back on their feet. But the reality is quite different.
Asia\'s residential markets have performed poorly, according to a report released by
the Global Property Guide. Once the price rise figures are adjusted for inflation,
Asia\'s record looks poor.

Press Release Body = Asian residential property buyers beware!
Asia\'s real estate markets seem, on the surface, to have recovered from the Asian
crisis and to be back on their feet. In fact the entire world has enjoyed a
residential property boom over the past decade - Europe, the US, Australia and New
Zealand have seen property prices soar.

But in Asia the reality is quite different. Asia\'s residential markets have
performed poorly, according to a report by the Global Property Guide. Once the price
rise figures are adjusted for inflation, Asia\'s record looks poor.

HOW ASIA\'S RESIDENTIAL PROPERTY MARKETS HAVE PERFORMED SINCE THE PEAK
(inflation-adjusted):
Hong Kong: still 61% below peak
Indonesia: still 50% below peak
Malaysia: still 10% below peak
Philippines: still 55% below peak
Singapore: still 37% below peak
South Korea: still 38% below peak
Thailand: still 10% below 1992 peak

\"There have been few less profitable investments than Asian residential property
over the past decade,\" says Matthew Montagu-Pollock, publisher of the Global
Property Guide (http://www.globalpropertyguide.com).

\"And if the present construction boom continues across Asia, the next decade isn\'t
going to be much fun for property investors either.\"

Rental yields are quite high in Indonesia, Thailand and the Philippines, while Asian
countries benefit from strong economies. But their real estate markets\' rise has
been limited, primarily by government mis-steps.

\"Asian real estate markets would have been stronger had it not been for government
mistakes,\" says Prince Cruz, chief economist for the Global Property Guide. \"If it
is not a coup, a protest rally or runaway inflation, then it is government meddling
in the housing markets that has killed performance\". Cruz\'s study points to the
housing markets of Singapore, Hong Kong and South Korea as victims of government
subsidies and intervention, while the housing markets of the Philippines, Indonesia
and Thailand have suffered from political instability.

Asian prices still far below peak levels
Despite gleaming reports of recovery, Asian house prices are still below their
pre-Asian Crisis levels. In a report released, Global Property Guide suggests that a
combination of inflation, widespread subsidies of housing markets, political
troubles, and overbuilding, have made the outcome in Asia quite different from other
\'boom\' markets. Asia\'s present apparent property boom is a \'construction boom - not
a property boom\', it says, warning investors against following the tempting siren
song of the real estate professionals.

When adjusted for inflation, the happy picture changes remarkably from the good news
about property price rises.

Indonesia, for instance, is having a difficult time battling inflation. Corrected
for inflation, Indonesia\'s house prices actually fell 8.4% in 2005 and 7% y-o-y
during 2Q 2006.
This year\'s mild nominal price fall in Hong Kong (3.7%) is amplified by considering
inflation. Hong Kong dwelling prices have actually fallen by 6% in real terms.

The (modest) apparent price rises in South Korea, Singapore and the Philippines
actually become price falls, or are greatly moderated, once inflation is factored
in.



Prince Cruz is a senior economist at the Global Property Guide

The Global Property Guide is a research publication and web site
(http://www.globalpropertyguide.com) for the high net worth investor in residential
property - providing information about the process and benefits of buying property
in any country in the entire world.

To access the report:
http://globalpropertyguide.com//articleread.php?article_id

Web Site = http://www.globalpropertyguide.com

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