Feb 29, 2008

Buying property as a hedge against inflation

With the prices of building materials increasing and if the price of petrol were to be increased again, we may see another round of increase in prices of building materials as the result of rising cost of transportation. We anticipate that developers may raise price in new property launches in good location as they struggle to maintain margin. In fact the increase in property price over the past two years far exceed the fixed deposit rate of banks meaning that keeping money in the bank allows your money to grow at a rate too slow to catch up with the increase in property price. Therefore it may be wise to consider property investment as another channel to grow your money but be sure to do your home work before the purchase.

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