Strong economic growth in the Philippines

The Philippines has just reported a healthy annualised growth rate of 7.7%, highlighting the enormous appeal of the country as an investment destination. You might be interested in our property report - listed below. There are several appealing facets to the nation:
1. Better economic management
2. Prospect of settling disputes with Muslims in Mindanao
3. Falling interest rates
4. Strong remittances from abroad
5. Strong Business Process Outsourcing
6. Proximity to Asia
7. English speaking, law and customs

The old problems of poor infrastructure are rapidly being curtailed. The low-grade cultural experience as a reuslt of 'enfranchisement' of malls is a problem that should be erased in time as incomes and urbanisation rates rise rapidly.

Asian property markets outperforming Japan Foreclosed Guide Philippines Property Guide
Profit from mining with Global Mining Investing eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

Advantages of buying property shift from Japan to Philippines

We have long sung the praises of investing in Japan for a number of reasons:
1. Lifestyle, lifestyle, lifestyle - Japan's conveniences and services make it one of the best places to live.
2. Japanese property outside cities is cheap. If you are not bound by job restrictions, rural areas are surprisingly appealing and not so remote. Foreclosed property gets far cheaper in these areas because there is simply no buyers.
3. Attractive yields of 12% make this an appealing place, though you do need to acknowledge that homes do depreciation, and earthquakes can accentuate depreciation rates. Of course the key is to identify the appealing locations.
4. Regional strategy - There is a tendency to treat Japan as a 'single market' but its really a number of cities surrounded by rural areas that don't really matter to the nation's economy. Basically few people live there and they are 'subsistence based' retirees. They will keep doing that until they die. The point is that these areas are depopulating. The people of Niigata and Aichi, etc are however not moving so much to the city centre of Tokyo and Osaka, but mostly to the 'fringes' of these cities. This is one reason why I bought in Hanno City. In the last 8 years, this town continues to grow in population. There is a new Cainz Home Centre, a new library, a shopping centre under construction. There is a university at Motokaji (nearby), the road up the Naguri River Valley has been upgraded. In other regional centres like Masashi Ranzen, the growth is not as strong because it is 1.5 hours from Tokyo on the Tobu-Tojo Line. Hanno is just 36minutes from Ikebukuro, on Tokyo's Yamanote (green) line, and its recently been linked to the Shibuya through its connection to the Fukutoshin Line, with good connections to Shinjuku and Yokohama.

The important fact is that whilst the population in Japan might be falling, the major cities are actually growing, and the dynamics of rail development is shaping where people migrate to. The implication is - investing in Tokyo and other cities is about realising where train services will be built, and how lifestyle values are shaping those moves.

But this story is not 'good bye' to Japan, but hello to opportunities in the Philippines. Why do you need to live in one place. So many of us have the flexibility to do otherwise, or otherwise to buy investment property.

Asian property markets outperforming Japan Foreclosed Guide Philippines Property Guide
Profit from mining with Global Mining Investing eBook

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

New editions of our property reports

Over the last 4 years I have prepared 4 editions of the Japan Foreclosed Property report; as well as preparing and updating similar reports for the Philippines and New Zealand. It is not my intention to continue this series of reports. Over that period I guess I have invested about 5 months of research into making the Japan editions for sales of around 300. That's $US6000. This is a stunning result for a first book, and it was not even my intent to actually write about property. Its just that I was in Japan for 3 months when I was considering writing an eBook, and of course recognising an opportunity for a very practical book. My ultimate intent was to write applied philosophy; which is the task I am embarking upon now. In the next few weeks I will launch a new website promoting these services.

As far as Japanese, NZ and Philippines property market is concerned, I will continue to support this site with feedback from readers (i.e. tagged 'Case Studies') prepared to offer such support. I will offer as much disclosure as you contributors want; and will ask you if you are happy with the content as posted for privacy and strategic reasons.

I will also post any topical stories I find. The feedback on these ebooks has been fantastic. Some people have rightly been critical of my spelling and grammatical errors; much better now after 4 editions. But aside from that, its almost been a zero complaints publication. So we are pleased with that. We have had heard some wonderful success stories with Japanese foreclosed property. We had a glowing appreciation from the Japanese Institute of Economics for our Philippines report. I did a lot of research for this 2-set book. The Philippines is a very hot market gives the disparity in West-East wages for the next 20 years; plus the 2% population growth and rapid urbanisation. Watch as new cities are built around Manila and regional airports are opened up to foreign (Chinese, Japanese, Korean) tourists. The Philippines already has among the most liberal immigration requirements in the world - you can stay there 18months before requiring to leave. More importantly, the Philippines government is starting to adopt some semblance of zoning as we see greater compliance with the law. So expect this to add to property prices; as well as result in more attractive development.

My biggest surprise with these books is probably the lack of interest of English teachers in buying Japanese foreclosed property. This is probably because most of them are 'lifestyle junkies' with no intent to stay in Japan, or maybe it speaks to their 'liberal' not-so-aspirational goals, or lack of savings. In any respect, I envisaged more of them buying foreclosed properties and turning their homes or offices into teaching schools. Most buyers have been expatriates in Asia or Japan; even fund managers and investment consultant-types.

Anyway, the opportunities in these countries are not over. I will continue to provide limited support for this and related blogs, however the property publishing is probably over unless I can farm the activity out to someone else. I know people who have become multi-millionaires buying foreclosed property, to the stage of buying entire residential apartment blocks and renting them off or selling them to students. I think I have listed such opportunities in this blog, i.e. A love hotel in Hokkaido comes to mind, decked out in 1970s decor. Very tacky! The Japanese student would probably love it.

NZ Property Guide Philippine Real Estate Guide Japan Foreclosed Guide

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

Muslim rebels deserve fair consideration

Living in the Philippines, you often here expatriates say that there is no risk living on the southern island of Mindanao. There are even those self-righteous souls who live in some of the more dangerous parts of the island. The reality however is that 'self-righteousness' can be very risky as human qualities go.

In this article, an Australian, Warren Rodwell, 53yo, is the latest person to be held captive by some Muslim rebel group. He is probably an expat of no consequence to anyone but those who know and love him. To the abductors he is worth just P1 million ($20,000).

In a certain context, we might argue that it is highly unfair or unethical for these Muslim rebels to resort to such measures. The reality however is that Rodwell's (Australian) government has effectively sanctioned the terrorists. We might ask what is an appropriate measure for a group of people to do when they are marginalised by their political system. Muslim people of Mindanao lived an autonomous, independent life on the southern island of Mindanao for centuries until the Spanish-American influence sought to resettle people from the more densely-populated northern & central islands to the south. This culminated, under democracy, in the marginalisation of the Islamic people, and their consequent disempowerment and loss of identity under "Catholic" policy. That's democracy you say! Well, this is just one of the problems with democracy. Extortion! Statutory law makes it possible for governments to use democracy for the purposes of extortion. Now whilst extortion is allowed under arbitrary statutory law, there is a common law tradition of extortion being illegal. Sadly, a fairly good tradition of common law has been trumped by arbitrary statute law in the West, and thus the Philippines.

Democracy is a system of extortion which imposes upon people the values of the majority on the basis of some arbitrary jurisdictional boundary. At this time, the boundary was sanctioned by the power of the Spanish, and sanctioned I guess you could argue by politically-allign Spanish colonists and the Catholic-supported Philippine government of the north. The Americans had a part in the resettlement as well, with the US-inspired Homestead Act, which saw large estates broken into 20-hectare losts for resettlers.

I personally think every effort should be made to negotiate a fair settlement with these people, with full recognition and empathy for their right to autonomy, and possibly sovereignty, given the existence of an independent Muslim state nearby. Personally, I'd prefer to see the Philippines become a federation of states, or a pan-ASEAN nation established along the likes of Europe with a common currency. Maybe this is the future, but the breaking down of trade barriers is likely to see this happen anyway.

I return to my original point. Filipinos are generally the most affable people. If they resort to extortion - its generally for good reason. In this case, whether we discuss the NPA or Muslim extremists, it is fair to say they are fighting extortion with extortion. Their marginalisation under democracy has been an act of extortion far grander in scale than anything they have perpetrated. For this reason, I hope the authorities give them due regard in these peace negotiations. I do not however expect it.

I will be the first to concede that there are Muslim terrorists with illegitimate interests in the world. The reality is that most of them are illiterate. I am not. These particular Muslims have a legitimate grievance against the Philippines (and arguably the American and Australian) governments for initiating, or otherwise sanctioning or tacitly endorsing the acts of their military forces.

Read more of my posts and you will readily see that democracy is not the only alternative to autocratic tyranny; its just a proxy for a representative's extortion. There is not a single form of democracy. Representative democracy is not really a form of democracy; its an extortion racket. You want democracy; then the only legitimate form for a nation-state is a 'meritocratic' democracy, where reason is the standard of value.

NZ Property Guide Philippine Real Estate Guide Japan Foreclosed Guide

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

Why buy property in Japan?

Comment by The real expert:

Why would I invest in something that has no capital appreciation? Instead of property investing with an unrealistic target of a 12% yield (never heard of a 5 million unit in north Tokyo), why wouldn't I put that cash into a fixed 8% term deposit? No risk and a guaranteed 8% return on investment, no maintenance headaches, no government red tape headaches, no flood headaches, no housing bubble headaches etc etc. Investing in the Tokyo real estate market would have to be the worst investment decision ever. If you buy a house in Western countries you will get appreciation on your investment, i.e the value of your house will go up unlike Japan where prices go down. Erik your article is total rubish and people should never buy houses in Japan for investment purposes.

The reason is because capital appreciate is just one issue - rent expense substitution or rental yield, depending on your perspective is the other issue. There is typically an inverse relationship between the two, i.e High capital appreciation or high yield. That is why Japanese yields are high. If you can find some structural distortion being corrected then you can get both, i.e. Say the Philippines today because it has 8% yield and good capital appreciation. i.e. There is the realisation that Asian labour is rising in cost, so even low-productivity Filipinos start looking appealing as a source of labour; most particularly because they make satisfactory call centre agents. This market does not rely upon the low-productivity ports in the Philippines. These issues will gradually be resolved, and the Philippines will be more broadly an appealing property market.

Japan only makes sense if you are buying a rural lifestyle property, an inner city land rental purchase of house, or suburban house for rent substitution; and even this might only make sense if you are earning Japanese income and planning to live there over 4 years. Since people love Japan, and 'hope' to live there, this can make a lot of sense.

The other issue is inflation and currency depreciation, which I have alluded to above. Bonds paying 8% in Japan? Unlikely - more likely 1% and paid is debased Japanese yen. The USD is also being debased, so need an bond indexed to inflation.

NZ Property Guide Philippine Real Estate Guide Japan Foreclosed Guide

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

Living and working abroad

There are obstacles to living abroad. But you know, its not as hard as you might think to live and work abroad if you are able to develop relationships in these countries or find forms of work that suit you. In my 'wonderings' I have come across people who find work abroad by doing different things. Consider the following:

1. Selling: I write books about buying property. Such book publishing allow me to live anywhere in the world because my store front is online.

2. Consulting is another activity that allows you to work anywhere in the world if you deal with your clients online.

3. Strategic career opportunities: There are certain jobs like doctors, nurses and teachers who are in strong demand around the world if you have decent qualifications.

4. Service jobs like teaching English, builders, trades jobs and tattoo artistry are also jobs that you can find if you travel. Generally though in these cases you need to tap into the informal economy, but consider this: In a large city like Tokyo, you can be sure there is a need for computer support services for all the English expatriates living there, because there are thousands there looking for a good deal who are getting ripped off because they don't speak Japanese, or have support. In such cases, forums offer support for most, but forums only offer limited support.

Different countries have different rules for staying in the country. i.e. Consider that the Philippines probably has the most liberal immigration laws. You can stay there 18 months before having to leave the country, but you pay around $30/month to extend your visa. Other than that, they care less what you do. In Japan, its a 90-day tourist visa, and hard otherwise to get a business or working visa unless you are sponsored. Having said that, you can fly to China or Korea every 90 days (3mths) if that suits you, or you can commute from another place and just stay the 90 days in gaijin houses (i.e. Short stay accommodation).

The intention of this strategy is to buy accommodation in different countries at the low-end of the market so that I can live a flexible and interesting life as a tourist. This is why a $28,000 dormitory in Japan appeals, with a $300/year rates bill, a $US55,000 house in a depopulating NZ regional city, rates a little pricey at $1700/year, or you can go a house in much of the USA for $80-120K. We also have a place and land in the Philippines.

This is truly a period of great flexibility thanks to technology. I would not equate this however with freedom. No country recognises your personal sovereignty, and no government functions on the basis of rationality as the standard of value. Under democratic tyranny of the 'populist' majority, we spread our assets widely. This is why grasslands are so prevalent. Their spores are basically blowing around the world. We like to travel light in a world of arbitrary government. Yes, that might sound a little tragic, but living a life of slavery to some over-priced, statutorily or artificially priced house is crazy. I don't own a house in Australia, my home country because with the average house costing 11.6x the average income in Sydney, I think I should be living in Japan, NZ or USA, where I can live in a decent place for 2-3 times earnings. Personally, I wish people would think so we can end this tyranny, but since we have a system of wealth extortion based on 'universal ignorance and passivity', I prefer to travel. If you are wondering where this ends up, it is either:

1. A life of repression - Japan is the model we are drifting towards - where you are all zombies entertained by mindless concrete, frivolities like alcohol, sex, etc.

2. A intellectual life - A form of meritocracy which does not yet exist, where economies grow at 16% per annum because they are not constrained by centralised government; which are not overtly materialistic because the people's intellectual sovereignty has been oppressed. In a world where ideas matter because there is a free market for them, as opposed to the statutorily regulated 'parliament' which has political parties act as gatekeepers. But you go on pretending you live in free countries because you are given some pretense of it. More on this matter at our politics blog.

NZ Property Guide Philippine Real Estate Guide Japan Foreclosed Guide

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

Trade deals likely to boost Philippines property market

The prospects for Philippines property look very good, and are getting better, after the Aquino government negotiates a $60 billion trade deal with China, after similar agreements with Korea and Japan. This is of course all very positive for the Philippines because this country is on the doorstep to these very large markets. Japan, Korea of course already have high cost labour, and in a decade, the Chinese labour cost, at least on the coast, is going to look a little scary. So the Philippines can expect to benefit from trade, tourism and investment. I expect a lot of these Asians to retire in the Philippines as the nation's standard of living improves. The Philippines has one of the most generous visa conditions in the world. I routinely go there for up to 18 months without having to leave the country. Learn more about the Philippines property market and these trade deals.

NZ Property Guide Philippine Real Estate Guide Japan Foreclosed Guide

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

Is it a good time to buy property in Japan?

Another writer, Chris Dillon, Dillon Communications, has advanced the value of investing in foreclosed property in Japan, so I wanted to assess some of his logic for recommending such an investment. Firstly, buying property in Japan for me is not simply about making money, as I am sure some of you are not out primarily to make money. Japan is a nice place to live or stay, so you would like a 'base station' in order to partake in some foreign experiences, whether its bars, bird watching or touring around, or simply retiring.

I agree with him that if you are looking for capital growth its hard not to look outside the cities. I think there are certain areas outside which appeal for lifestyle reasons, i.e. Holiday houses in the west of Tokyo and Saitama, which make excellent weekend 'get-a-ways'.

He likes old apartments because they offer great yields. I would be inclined to steer away from such old places because you are paying out too much in property management fees, over which you have no control. Why buy an apartment on good yields when you can buy a house on good yields, and pay only low taxes.

In a sense I agree with him about the bad news about Japan. All the bad news has effectively been priced into the market. What else can go wrong? Well, on the basis of his argument, I would have to say the currency. He says the 'yen's strength is not a major issue'. Indeed, because it is not strong, so much as "relatively strong" against other very weak major currencies, namely the Euro and USD. They are hardly a good standard if you are looking at currency diversification. If you were looking at strong or 'hard' currencies, you would be looking at the AUD. Incidentally, Australia has recorded the strongest property market over the last year. Another good property market is the Philippines, with its 7% GDP growth, 2% population growth and strong property price growth and still reasonable yields. It is also a relatively strong currency. More importantly, Japan has a public sector debt of 200% of GDP. There is every reason to believe a fair slug of that will be repaid by debasing the currency in the next decade, as the US and Euro zones do likewise.

He does make a good point:

"One of the biggest is in the preference for new property. In Japan, used homes represent about 13% of total sales, compared to 78% in the United States and 89% in Britain. That is changing, as the Japanese government encourages the construction of long-life homes, but many people still see homes as consumable items".

The significance of this is that a steep discount applies to old housing, such that you can buy an old house for essentially less than zero in the foreclosed market. People do not want old housing, particularly due to the lack of insulation, but also shoddy building practices, lesser durability.

He makes a good point about buying rural property. The population rate is expected to collapse in rural areas, so the closer you can live to major cities the better. The flipside is that wasteful use of infrastructure might result in either tax incentives for rural areas, or eventually stronger migration. The cheaper that rural property becomes the more attractive it becomes for other purposes, whether lifestyle activities or other activities. It must be acknowledged that people have a far higher level of mobility than in the past, so we do have to question old paradigms.

NZ Property Guide Philippine Real Estate Guide Japan Foreclosed Guide

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

Japanese residents for Philippines property?

Anyone in Japan interested in taking advantage in the forthcoming weakness in the Yen. The Philippines just might be the place to buy an investment property. See my forex report, but consider that Philippine banks in Japan are offering loans to buy property in the Philippines. I'm not sure if this is just for expat Filipinos, but I see no reason why there would be such a restriction. Anyway, you can ask yourself. The Philippine banks in Japan are BPI, BDO, Metrobank, Union and Philippines National Bank (PNB). I note that PNB has an office in Tokyo - see here for details. They offer loans to Filipinos and foreigners, whether or not you are married to a Filipino.

I would be interested if lenders can avail of those low-interest Japanese funds in order to buy property abroad? Worth finding out. Actually the rates are on their website. I believe you can get rates of 10% in the Philippines for a 5 year term, compared to just 6.5% in Japan for loans on Philippine property. See here.

NZ Property Guide Philippine Real Estate Guide Japan Foreclosed Guide

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

The cost of living and property overseas

For those interested in buying (foreclosed) property in the Asia-Pacific region, we think value-wise, Japan and the Philippines make a lot of sense. Of course value is absolute as well as relative, and one needs to consider these values from your perspective of value. This I have done, and it has culminated in reports on the Philippines, New Zealand and Japan. If you like the Philippines, you might also like Thailand. Japan has a great appeal to many young and old because of its rich cultural experience, great services and infrastructure. Mind you a great many Westerners these days go to the Philippines for medical treatment on the cheap. I have used one of the private hospitals and they do have experiences, Western-educated doctors. Anyway, the property reports aside, if you are interested in the countries, then I have blogs pertaining to these countries where I explore more of the issues living in these countries.

1. Living in NZ - In this blog I also talk a lot about Australia - my home country - as they have similarities, and people interested in NZ are usually interested in Australia.

2. Living in Japan

3. Living in the Philippines

There are of course other countries where you can live and even buy property, however I find these countries the least restrictive in the Asia-Pacific. i.e. You can stay in the Philippines by extending your tourist visa for 18 months before you have to leave. But they don't mind if you come right back. Its just a question of paying around P1500 per month. You can stay in Japan for 3 months. They will let you extend, or you can leave & re-enter, in which case they will ask questions, unless you have a girlfriend who will sponsor you. I did, and was able to stay there over 2 years. I also worked these on another occasion. Teaching English is a great way to get sponsored to live in Japan...if you have a BSc/BA degree. NZ allows you to stay 3 months, but you can extend for 6 months (which is the mnimum property lease period), and its easy enough to go to Australia for another 6 months if you want to stick around the region. Many young and elderly people live from campervans in these countries.

NZ Property Guide Philippine Real Estate Guide Japan Foreclosed Guide

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

Earthquakes - Lessons for property buyers

In our latest Japanese foreclosed property report we have added a great deal of information to assist you to avoid the damages caused by earthquakes. Japan is amongst the most unstable or active in the world, alongside places like Papua New Guinea and Indonesia. We also have a NZ property report, and since there was a recent serious earthquake in NZ, we thought we would offer some general public information to assist property buyers. I have some understanding on this issue since I studied geology and geophysics at university in Sydney.

There are some basic issues to understand:

1. Earthquake risks are not always understood because fault lines are not always know. This is because modern human records cover a far shorter period of time than geological processes. Active or previously 'inactive' fault zones can be concealed by recent sediment cover. This is true of the Kanto plain, as well as the Canterbury Plains of NZ.

2. Earthquakes can be zones of weakness, and perhaps not just a single plane of weakness. It might be better to consider them 'crimple zones'. They comprise jagged lines of weakness with zones of intense distortion as well as zones of dilation, where stresses vary from weak to intense depending on the competency of the rocks involved.

3. Earthquake risks are not equal for different regions. Competent basement or foundation rock provides greater security than loosely consolidated sediments. For this reason, thick piles of sediment pose greater risk

4. Unconsolidated sediments pose particular concerns where they are water-saturated, i.e. In areas of high rainfall or low-lying areas. In these cases, sentiments in the 'crimple zones' can undergo liquefaction, in which case they lose all strength and behave like a liquid. This can result in the foundations of your house sinking into the soil in the earthquake zone.

5. An earthquake zone can be a broadly-defined, as is required to relieve the stress. i.e. It is common for a transform fault like in NZ to involve multiple faults, with the outer faults defining the fault zone.

6. Those regions which were historically active for earthquakes might not adequately define zones of future vulnerability. For the reasons already mentioned, old zones of faulting might be concealed by extensive flood plains, as was the case with the Christchurch earthquakes in Sept 2010.

7. A serious earthquake can result in a large number of houses being heaved off their foundations, which are contorted by the ground movement. The houses can sink into the soil, and its common for any brittle structures to crack and fall into the house, i.e. In Christchurch, most brick houses in the fault zone were destroyed as they crack up. Chimneys made of brick often toppled into the structure, posing a risk to residents. Most of these houses need to be demolished and newly built, even if they look fine from the outside. The door hinges might not work properly because of the distortion, just as your car hinges can be poorly aligned after a car crash.

8. Different countries have differing levels of preparedness for coping with earthquakes. Japan is far better in this respect than NZ. Avoid brick homes in NZ, even though they have increased in popularity. The old weatherboard and modern galvanised sheet homes probably make the most sense. Houses on concrete pilings (i.e. posts) rather than concrete slabs make the most sense, though that ultimately depends on the thickness of the foundation, the size of the slab, the competency of the host rock, and the saturation of any unconsolidated sediments. Avoid low-lying areas with unconsolidated sediment foundation.

In the Japan report, I offer a map showing regions of vulnerability to earthquakes based on the Japanese governments analysis. For NZ, there is a transform fault going up the centre of the South Island, and up through Wellington to Hawkes Bay on the North Island. The Taupo Volcanic Zone has not historically been an area of intense earthquake activity, though it is active as well, since that zone is spreading apart at 10cm per year. There is a fault going down to Wanganui City (population 40,000). This region experienced a 5.1 earthquake in Aug 2010.

NZ Property Guide Philippine Real Estate Guide Foreclosed Japan Guide

Author Andrew Sheldon Applied Critical Thinking | www.SheldonThinks.com

Advice for Japanese savers

The Japanese Yen is close to a record high point. This is not likely to be sustained because of the need to maintain Japan's export competitiveness as well as the need for the Japanese government to finance its current domestic debt. I therefore advice Japanese investors to place some of the Japanese savings in foreign assets in order to protect themselves from a future currency debasement.

The question is where?

I would suggest several attractive destinations:

1. High yielding Philippine property. It offers yields of 8%, it is close enough to enjoy as a holiday house, its a booming economy with strong population growth. We have a report in English.

2. United State foreclosed property for future capital and yield growth, but also immediate currency protection, and the prospect of holidaying.

3. Mining stocks in the USA - such as gold and copper stocks. See gold price

Please excuse my Japanese (Google) translation:

日本の円は過去最高点に近いです。これは、必要が日本の輸出競争力を維持するためにのために持続する可能性はない。私はそのためのアドバイス日本の投資家は、将来の通貨変造から身を守るためにいくつかの外国資産の日本の貯蓄を配置する。

問題はどこですか

私はいくつか魅力的な目的地をお勧め：

1。高降伏フィリピンプロパティです。これは、8％の利回りを提供し、それは十分に近い別荘として楽しむためには、強力な人口増加との好景気。私たちは英語でレポートしています。

2。将来の資本と歩留まりの成長のための米国国家抵当流れプロパティだけでなく、即時通貨保護、および休暇の見通し。

3。アメリカの鉱業株 - 金と銅の株式など。See gold price

NZ Property Guide Philippine Real Estate GuideForeclosed Japan GuideAuthorAndrew SheldonApplied Critical Thinking | www.SheldonThinks.com

Philippines property - contrarian investment

Property investors beware. You are about to be introduced to one of the best opportunities to buy property you will ever have. The Philippines has long been the 'dislexic' tiger of Asia. It always had a lot of promise, but it could never overcome the legacy of corruption and inept administration. There is perhaps ever reason to think that a solution is not far off, but it will be another 6-8 year. In the meantime, there is every reason to think that the economy will perform ok.

There is good reason to think you will get a great opportunity to buy property there. The reasons are explained in this post I wrote about the current president Noy Noy Aquino. I believe there is very good reason to expect a 'Thai style' military coup. This is of course the time to research, to set up your bank account, and to be ready to transfer funds. During the last crisis - the Asian Currency Crisis - a large amount of money was made and lost.

The implications are that you will never get a better chance to buy property in the Philippines. Any such military-police takeover of government will result in the Philippine peso plummeting to new lows. Check out the currency here, whilst I have indicated support levels on the following chart.

This is the time to be a contrarian investor - both for foreigners and Filipino expatriates. The Philippines is a good long term story. The population is growing at 2% per annum, the economy benefits from a lot of remittances from expatriates abroad, it is the focal point for outsourcing of Western businesses professional services like call centres, etc. The benefits will not be confined to Manila. It is also just a 'stones throw' from China, so expect a lot of tourism, investment when China becomes overheated. The Philippines already has a large Chinese community.

We have written a Philippine Real Estate Guide (2 eBook set) which describes the opportunities in the Philippines property market.

Philippine Real Estate Guide

Foreclosed Japan Guide NZ Property Guide AuthorAndrew Sheldon Applied Critical Thinking | www.SheldonThinks.com

Interesting property markets

New Zealand (North Island, countryside)

There are several appealing markets in which to buy property. Among the markets we cover, we consider the best buying to be the Philippines for capital growth, as well as satisfactory yield. Japan offers compelling yields, however there is less prospect of much capital growth in the medium term. Mind you, since the government will likely resort to printing money in order to pay off the public sector deficit, expect some nominal price increase in property and equity assets, but of course that will be inflation-based. They might however be offset by higher property taxes and a GST increase. I see no new taxes in the Philippines, just higher compliance measures. Despite high nominal taxes, people in the Philippines pay amongst the lowest taxes in the world, i.e. 16% of GDP. Its a good deal if you can scam it. Don't be a proud taxpayer....most of your taxes goes to corrupt people, or serves inefficient purposes. You are the best custodian of your money. No one respects it as much as the person who earned it. That which was well-spent you would have been happy to finance if you had a choice. Don't believe you had a choice when you voted in the last election. You have no real or effective choice.

The NZ property market is less appealing at the moment. The currency is consolidating around 0.70 USD and there is the prospect of rising interest rates constraining price growth. Equally problematic is the exodus of NZ'ers to Australia. NZ population growth is just 0.5%, with the exodus of NZ'ers balanced by Asian and other immigrants.

Some commentators are expecting a collapse in Australian property prices. Frankly, I don't see it when the economy is supported by a lot of commodity projects and immigration. Expect business investment in the mining & energy sectors to remain strong. The Resource Rent Tax interestingly will hurt, particularly if they talk about it, then decide to defer it, or not do it. It will leave investors in limbo.

Another positive is the tight housing supply. There is no doubt this is due to the hefty increase in immigration. Immigration to Australia has risen from 100,000 in 2004 to almost 300,000 today. It was doubled from 2007. Clearly the government saw immigration as a means of avoiding recession. It looks like the govt wants to use immigration and mining taxes to finance the retirement of babyboomers.....as opposed to doing what it ought to do....removing the cap on private sector activity. By cap I mean the excessive involvement of government in the economy...stupid arbitrary statutory law, subsidies, welfare transfer payments, etc. Sound idealistic? Well, you would be surprised how counterproductive these measures are at remedying problems. Government solutions are the problem.

1. Housing affordability a dream? Blame the arbitrary restrictions of government zoning which prevent land lot availability.

2. Can't get a job? Blame government cumbersome planning approvals, and most particularly public infrastructure funding and minimum wage limits.

3. Can't make money in a volatile investment climate? Blame government for distorting 'free' markets to ensure they get elected. They don't care if they channel billions into wasteful, unproductive investment, just as long as they get elected.

4. Can't find good workers? Blame the public education system which offers a low-standard for the private sector schools, which fake it, and sell their reputation.

5. Can't even make good friends? Blame a political culture which sets the standard in self-delusion, political correctness and subjective value judgements. Same for forging lifetime relationships. Divorce rates manifestly come from the same problem.

NZ Property Guide Philippine Real Estate Guide Foreclosed Japan Guide

AuthorAndrew Sheldon Applied Critical Thinking | www.SheldonThinks.com

Election implications for Philippines property

I was actually in the Philippines immediately after the election result. Just for 6 weeks mind you, but long enough to observe some of the political play, as well as time for a holiday. I visited Camiguin Island and Puerto Galera. Camiguin Island was recommended to me years ago by a resort developer there. Having been there, it has some attractions, but its way too under-developed. I will publish a separate post on the place, as well as Puerto Galera for property buyers interested in those places.

El Nido, Palawan, Philippines

My assessment of the election is that the economic spending will fall a bit after Arroyo's unsustainable 'spend' on roads. I am suspicious of the new president Aquino's anti-corruption credentials based on some statements, but his appointments look credible. He has conveyed that his economic policy is the same as Arroyo by appointing her finance minister. The Philippines GDP grew 7.1% last quarter....as anticipated by us 18 months ago. The fundamentals for the Philippines are very good. A lot of construction going on, remittances continue, call centre business grows. Expect the poor Aussies and Kiwis, etc to come over for their dental services next, and Americans for their 'uninsured' medical. Out-sourcing continues.

NZ Property Guide Philippine Real Estate GuideForeclosed Japan Guide AuthorAndrew Sheldon Applied Critical Thinking | www.SheldonThinks.com

Regional property market outlook

For those of you interested in property in the Asia-Pacific region, consider the following news with respect to each of the markets we cover.

1. The Philippines property market prices appears to have bottomed according to Global Property Guide. This company relies on a number of indices produced by Colliers International. You can view their quarterly market report at Colliers. Based on other posts I have made about the Philippines, I have a lot of confidence in the nation's fundamentals. This is of course evident from the latest edition of our report.

2. Japan Property Market has never really recovered so if you are looking for a turnaround story then Japan might be a place to consider. The prospect of reform-minded government is looking less likely given the controversies which have put the alternate government (i.e. Democratic Party of Japan) on the back foot. The country does however remain a great place to live and work, and the foreclosed property offerings at huge discounts make it an appealing option. The fundamentals are deteriorating, though the foreclosed market is still trading at huge discounts for anyone happy for property more than 1 hour from the largest cities.

3. New Zealand Property Market is still to find a base in the cities though you can find cheap property in some rural areas. The exchange rate for NZ and a number of commodity based countries makes this market less appealing, except for the committed retiree who can loan funds locally. In any respect this is not the time to transfer assets to NZ, or to buy property generally.

NZ Property Guide

Philippine Real Estate Guide

Foreclosed Japan Guide

Author

Andrew Sheldon

Applied Critical Thinking | www.SheldonThinks.com

Australian property buyers set for retirement

On many occasions I have spoken of the huge amount of investment which is set to provide a huge amount of stimulus for the Australian economy over the next few decades. In the 1960s and 1970s we saw a rush of Japanese investment into Australian resources. Well in the next 20 years I would not be surprised to see $300-350 billion of mining investment in the industry, encompassing mostly offshore gas, iron ore, coal, coal seam gas, gold, base metals and alumina. Am I missing anything? Probably. The Chinese population is 10x Japan's and I have not even considered the other billion in India, which will also need a large amount of resources. India and China are not exactly mineral-poor economies, but mining in them is relatively disruptive compared to mining in Australia. There resource quality is not as good either. eg. India's coal is dirty, particularly its coking coal. China lacks coking coal, so these are good areas for investment.

The implication however is that Australia is going to have a strong market, so I would not be expecting property prices to fall. They will go sideways at worst, if the government opens up land releases. The reason to keep property prices hard is that it makes you work harder, you pay more taxes, and it ultimately makes you compliant with our fascist punitive government.
Sovereign risk is a problem in any country, and its easier than ever to shift funds and buy assets abroad. There are other reasons as well....foreign exchange benefits.

There is no question you will benefit from having assets in Australia. The AUD will be strong, though when our terms of trade is so strong usually Australians spend a lot on consumption. This is just one for reason to have assets overseas. The AUD is one of the most volatile currencies in the world. If you have the flexibility to be transferring funds at opportune times, you can save a great deal. For instance, we bought a house in NZ at USD0.50-0.53, its now 70c to the USD. The implication is the same for Australia.

Of course we want to be buying in markets with good fundamentals, or perhaps simply lifestyle benefits. My partner and I have property in NZ, Japan and the Philippines. We like these markets. I believe 84yen was a low for the Yen. That has not been my position for the last 2 years. That target was essentially reached. There will be a stronger currency looking ahead because of higher interest rates. Eventually the property market will recover, so you might want to look at foreclosed property. Of course if you can't borrow money in these markets its a bit more difficult, as you have to time your investment well. So you need to watch the charts. Of course we have provided guidance before through this site.

Japan is very cheap if you want a rural lifestyle place for just $USD20-50,000; its more in the city, but you don't need to live right in the city and pay $500,000 plus. Japan is a great place to be a tourist. The Philippines is not a lifestyle place for everyone, however it does have appeal as an investment destination as well.

From a currency perspective there is no need to rush your dollars out of Australia because the AUD is strong, and any interest rate increase to slow the economy will only aid the currency. The greater issue is timing. Key dates to consider are the elections coming up in the Philippines and Japan, plus I would not wait too long in the USA, as the surplus property will be soaked up. High apartment vacancy rates in places like Miami will be absorbed.

NZ Property Guide
Philippine Real Estate Guide
Foreclosed Japan Guide
Author
Andrew Sheldon
Applied Critical Thinking | www.SheldonThinks.com

Korean population and tourism rising in the Philippines

This article highlights the growing popularity of the Philippines, both as a tourist destination and a place to live. You will not see accurate statistics on inbound tourism since the rules for entering the country have become increasingly liberal. The Bureau of Immigration cites a 51% increase in the number of Koreans entering the Philippines between 2003 to 2006.
It is not just Koreans either - the number of Chinese are also rising strongly, as well as Westerners and Japanese. Each nation seems to have its particular precincts or focal areas. The Koreans are keen on Cebu as a holiday destination, however a great number of Korean families are living in the Philippines for the benefit of their children. The appeal is that they can live in the Philippines cheaper and ensure their children obtain an English education. This strategy also allows them to trade up to a nicer house, as well as have a maid. All the things they would never have conceived of in Korea.
For English most families stay in Manila, or choose the larger cities like Baguio. In some cases the father remains in Korea to work. I know cases of Korean families who have attempted to establish Korean food restaurants in the Philippines, and not been able to attract the customers to justify the business. The reason I suggest is the unsophisticated pallet of the Filipino who are not accustomed to Korean food, and for all but the upper class, eating out is a luxury, and they prefer sweat fatty foods, rather than spicy Korean.

A number of Westerners are taking of the opportunity to develop English schools in the Philippines for these people. Consider that many Westerners working in English schools in Japan or Korea are able to move to the Philippines can poach customers from their traditional home market. The logic is simply to save money and give the child the best possible chance to learn English. The strategy is typically:
1. Buy or rent an apartment for mom and child to live in for a few years
2. Buy a business with the intent to migrate
3. Buy or rent an apartment for university age student to study English

NZ Property Guide
Philippine Real Estate Guide
Foreclosed Japan Guide
Author
Andrew Sheldon
Applied Critical Thinking | www.SheldonThinks.com

Are OFWs really buying property?

The Philippines Inquirer "Property sales to OFWs are rising" (7th Mar 2010) seems to suggest inconclusively that Overseas Foreign Workers (OFWs) are buying more property in the Philippines. This strikes me more of biased reporting by interests aligned to the property developers. Certainly remittances are rising - up some 16% if I remember correctly. Though I would suggest increases in interest rates, new property sales, non-property-related remittances and long 20-year loan commitments could readily account for those increases, not to mention uncertainty about the US market, the talk of weakness in the USD, concerns for family during recession, volatility or uncertainty in investment markets.
I suggest instead that the ratio of OFW buying has increased as a proportion of total sales because local property buying has declined significantly. The increase in domestic tourism might suggest that Filipinos are spending more on recreation rather than capital investments. I think if there was more to this story, they would have provided more detail on absolute sales numbers. This is not an easy number to determine because some OFWs are inclined to buy in the names of local family. My experience tells me to be suspicious of this argument. Property developers will benefit from prior commitments to incomplete properties. They should thus record reasonable sales for this year, though I suggest it probably does not look so good for 2011.
You can read the article on the Philippines Inquirer website.

NZ Property Guide
Philippine Real Estate Guide
Foreclosed Japan Guide
Author
Andrew Sheldon
Applied Critical Thinking | www.SheldonThinks.com

Philippines attractive to Europeans

A gentleman the other bought my report from Spain. It was my first customer from Spain, so I was surprised; however I quickly made a connection with the current banking and currency crisis in Europe. I am aware that wealthy Greeks, Portuguese and Spanish investors are pulling their money out of Euro. This is understandable given the possibility of these countries being ejected from the EU. I actually think this is a desirable occurrence. These 3 countries and a number of Eastern European countries would be better served by their own currency.
I can nevertheless see the interest of this particular customer in the Philippines because of the historical Spanish influence in the Philippines, the similar values, the property fundamentals, the economic fundamentals. The Euro is not faring great against the peso, but even still the trading band is relatively narrow, so no great loss in making transfers now. Over the last 5 years the Euro has traded between PHP60-70, so not much variation.
The Philippines is some of the best exposure you will get to Asia. Its about as Western exposure as you can get to Asia without paying a premium for the currency; as you will do buying property or other asset classes in Australia, Canada or NZ.

NZ Property Guide
Philippine Real Estate Guide
Foreclosed Japan Guide