FOCUS: “ Malaysia & Singapore top real estate transparency rankings in Asean”

OPEN: Transparency in global real estate markets is up with Singapore and Hong Kong being ranked amongst the world’s most transparent countries, says report

Despite rumbles in the property market, Malaysia still ranks among the most transparent countries in Asean, alongside Singapore
in terms of their real estate markets, says the recently released biennial index by Jones Lang LaSalle.

“With the exception of Vietnam, most Southeast Asian markets are either in the transparent (Singapore and Malaysia) or semi-transparent band (The Philippines, Thailand and Indonesia).   This finding is echoed by the recent rise in direct foreign investments (FDI) into the Asean especially into Indonesia and the Philippines. The rise of FDI into Asean is testament of global investors’ confidence of the long term growth potential in this region,” said Chris Fossick, Managing Director of Singapore and South East Asia, Jones Lang LaSalle.

He continued: “The real estate markets in Southeast Asia have made significant inroads in improving their transparency over the past two years. Three out of the top 10 improvers globally
are from this region – The Philippines, Indonesia and Vietnam. All three countries have improved on the back of greater availability of market data and changes in the regulatory and transaction processes.
 

“Whilst there are no Asian cities yet in the top 10 highly transparent markets globally, Hong Kong ranks the highest in Asia at 11 with Singapore closely behind at 13. Both Singapore and Hong Kong have shown improvements
in their overall global ranking with Hong Kong marginally ahead of Singapore as a result of more detailed market fundamental data.”

The 2012 Global Real Estate Transparency Index revealed that recovering real estate markets have generally prompted renewed impetus to transparency improvements following a slowdown in progress during the financial crisis in 2008 and 2009.   Nearly 90 per cent of markets have registered advances in real estate transparency during the past two years, driven by improving market fundamentals data and performance
measurement, combined with better governance of listed vehicles.

On the other hand, the 2012 Index noted continued transparency deficiencies in many African, Middle Eastern and Latin American markets. Nations scoring the lowest on transparency, the so-called opaque markets, include Venezuela, Mongolia, Tunisia, Ghana, Iraq, Pakistan, Algeria, Belarus, Angola Nigeria and Sudan. Many of these countries were scored for the first time in this edition of the Index.
The Index, a proprietary Jones Lang LaSalle survey that calculates transparency in 97 real estate markets worldwide by weighting 83 different factors, provides investors with data and analyses critical to transacting, owning and operating in global markets. The Index also assists governments and other industry organisations interested in improving transparency.

Among key findings from the report:

·The United States ranks as the world’s most transparent real estate market in 2012, followed closely by the United Kingdom and Australia. Also in the ‘Highly Transparent’ category: Netherlands, New Zealand, Canada, France, Finland, Sweden and Switzerland.

·The Index reaffirms the ascent of the MIST growth markets (Mexico, Indonesia, South Korea and Turkey), which all feature among the leading improvers.

· Regionally, Latin America has seen the strongest progress in transparency.   Brazil’s Tier 1 cities rank second globally in transparency improvement and now sits in the ‘Transparent’ category.   Mexico sits in third position globally (in terms of progress).

·The gap in transparency between Western Europe and some of the main Central European markets has been virtually eliminated as core CEE markets approach the mainstream.   Poland, for example, has transparency levels comparable to Western Europe and is now considered by some investors as a ‘core’ market.

 

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