Real Estate: Investment Themes to Pursue in 2018

hen it comes to investing in the coming year, there is so much data out there relating to genuine investment developments that it is easy to get misdirected. In Singapore, spending on property remains the most ideal form of investment. Let us take a look at some of the key up and coming property-related investments for next year in Singapore.

  1. Property technology

Property technology or proptech is a fast growing trend that leverages cutting-edge technology to provide better middlemen services to people building, selling, purchasing, renting or managing commercial or residential property in Singapore. There are multiple local start-ups in the field of proptech in Singapore that are getting the attention of venture capitalists.

Such companies are growing even in the neighbouring market as they are getting support from the Government of Singapore, despite the small market size and restricted resources. C31 Ventures is one example of such a startup that has caught on to this emerging trend to lead from the front in the real estate market.

  1. Properties in Sentosa Cove

In Singapore, the next big swing in investment is expected to drift towards the property market as many analysts confidently foresee. After declining for four successive years, Singapore’s property market has eventually touched a point of inflection. As per Vikrant Pandey, an analyst from UOB, prices of property are likely to grow between 5% and 10% by the end of 2018.

Property market in the luxury segment in particular is showing growth signs, specifically so for select properties in Sentosa. Even with many properties earlier racking up losses and abundant unoccupied houses, sales at the expensive isle now are picking up. A bulk of property buyers in Sentosa Cove in 2017 have been Singapore citizens, while condo sales have also been picking up. As per the data of URA Realis, 21 condominium units were sold in 2017, exceeding the yearly sales of the past four years and it is expected to grow further in 2018.

  1. Oil & Gas sector is expected to recover

Oil prices remained low for the whole year of 2017 and people have been staying away from Oil & Gas. However, as per DBS, the scene will change next year. DBS is anticipating another spell of recovery in the prices of oil after some positive changes.

DBS estimates that oil consumption across the world will show a healthy sign of growth next year with around 1.4-1.5 million barrels per day. Also, there are indications of growing consumption in Europe and US due to the lengthy period of low oil prices. High demand from developing nations like India and China is growing as well.  It will be prudent for you to purchase shares of companies like PACC Offshore Services Holdings and Sembcorp Marine.

  1. Solar Home Systems

The market for solar home systems has been growing in the rural parts of Southeast Asia for a long time now. It is attracting funds from both regional and local investors. SolarHome is one example of a home-grown startup that has made it big. SolarHome offers solar home systems, targeting the less privileged people in Southeast Asia. This model allow customers to own solar energy subscription, at S$3-15 per month.

Solar Home is the pioneer in this field and it believes that this market will grow quite considerably in Southeast Asia, since almost 27 million families are not dependent on electricity in the region. Till date, the company has raised S$1.1 million.

  1. Technology sector

With the explosion of disruptive technologies like Internet-of-Things (IoT), Artificial Intelligence, Big Data and more, the technology sector is buoyant not just in Singapore, but all over the world. Many financial experts believe that this buoyant run will continue and the demand for technology sector will remain. Stocks of companies like Venture Corporation and Hi-P International will grow as it witnesses substantial margin improvements, which has also been lifted because of its expansion into new segments.

Today, the growth that we are witnessing in the markets mentioned above is fairly competitive and it is worth investing in these sectors in the coming year.

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