Experienced/Advanced Property Investors
Updated: Jul 21, 2019
You are probably wondering why I need advice or professional guidance when it comes to property investment when you have a successful portfolio of mixed properties. Here is why, diversification; as much as you would have secured your monies across different properties within your domicile country you haven’t factored in economical and political climate changes.
Now more than ever we are seeing increasing amount of instabilities in the current world affairs. If all your monies are secured in one country you have effectively as it goes put all your eggs in one basket. We are seeing multiple changes not seen before across America, Europe and Asia so the question is, how secured is all your finances in one location? Additionally how well secured is the currency from volatile fluctuation?
Volatility of Sterling Pound
Over the last few years Brexit has caused sterling to be quite volatile, one of the oldest and highly reputable currency, this shows even sterling is not bullet proof or completely secured against uncertainty. Sterling has lost more than 20% of its value against the dollar and Euro, how will sterling react when Brexit is confirmed? The point being raised is if all your monies is gaining interest in a singular currency you are more at risk from currency fluctuation and political uncertainty effectively losing you value on the international markets.
Another example is the situation in Hong Kong, which is to be handed to mainland China. Hong Kong is one of the most secured and safest destinations regarding investment opportunities, daily in billions transactions are taking place and mainland China will be effectively taking control of Hong Kong as planned from 2037. This creates political uncertainty however in fairness China is one of fastest growing country in terms of development as China has developed multiple cities. Nonetheless from a property investors point of view if you have a strong portfolio of successful properties in Hong Kong how would you tackle the uncertainty that will be?
There are two key points being raised using two different current affairs, currency fluctuation and political uncertainty that can influence changes in laws. How would you cope with the fall in currency? How would you plan property investment post Brexit? How would you cope with changes in property tax? How would you cope with restrictions in movement of monies? Most importantly how do you secure yourself outside of your domicile country?
These are the type of questions you should be able to answer when you have a large portfolio of properties or if you are an advanced property investor. It is critical to analyse such scenarios and this is why we strongly advice our experienced international property investors to always diversify their portfolio.