QUOTE(mercury8400 @ Sep 7 2011, 03:07 PM)
Market price of what?
If the reits assets i.e. the buildings (especially commercial reit play i.e. shopping centres) are located in prime area (suntec, orchard) there is very little risk that the market price for rental will drop. At worst it will remain stable i.e. no up no down. Commercial property in prime area is always in demand irregardless of the economic disposition.
I was referring to share market price. If the reits assets i.e. the buildings (especially commercial reit play i.e. shopping centres) are located in prime area (suntec, orchard) there is very little risk that the market price for rental will drop. At worst it will remain stable i.e. no up no down. Commercial property in prime area is always in demand irregardless of the economic disposition.
On the property valuation done here is on the high side, especially seller (promoter) will thrashed their into reits are at most positive timing/pricing and best rental yield.
Once there is a negative outlook in economies, which does affect demand for rental or outlets, especially those with foreign brands, which may pull out or cut down on stores here, this will screw up rental yield and eventually valuation (reasonably done at that time with questionable sensitivity analysis) will screw up as well.
Hence, wat im trying to say is reit are indeed "volatiled" by economies, as opposed to theoretically property investment is a safe investment, hence is kinda immune to economies in general.
Please note, I'm note trying to generalise and say reit are no good investment, but dun assume reits are a good classification for your slow and steady portfolio.
Sep 7 2011, 05:19 PM

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