In my personal opinion based on the little knowledge I have as well as the many articles and analysts reports, I seriously think London properties are already at a very high level. It may just have to correct or even stay stagnant for some time before going up further. Just look at the average property price today, it’s already over £500,000 (Source: Guardian) on average while the typical median income is highest within the London city at £51,952 (Source: ONS). As for the rest of London, it is lower, thus you can imagine that its even harder to buy a property. In brief, affordability is a huge issue in London. Nevertheless, the interest in London properties remain very strong today. Just look at the many projects that the Malaysian developers are involved in within London today.
It is thus a good news to me when I read that our Employees Provident Fund (EPF) is looking to sell one or two of its properties which it has profits. The proceeds from this would then be used for new investments elsewhere. No analyst can predict how high can property prices go up to or when would the property prices suddenly fall. As long as the profit is pretty substantial and the signs are already showing ‘unaffordability,’ the better decision would be initiate selling because even selling would take some time. Furthermore, this is not one little cottage but part of a total property investment value of £2bil (RM10.7bil). CEO of EPF said, “Investing overseas is not inherently riskier than investing in Malaysia. What we have to look at is the actual assets that you invest in and the risk returns that one expects from it.”
Due to strong returns from the investments in the US and Europe, EPF declared the highest ever dividend payout since 2000. In line with this an all time high profit totalling RM36.66 billion was credited into EPF members’ accounts last year.
Personally, I have not transferred any EPF money into unit trusts no matter how awesome the returns promised to me. I think I wanted to ensure I am more diversified and if I would like to invest in equity, I would prefer to do it by myself instead of relying on the fund managers who may or may not be better qualified than me because they are also just an employee of the company that employs them. Thus, my exposure in unit trusts would continue on a monthly basis but it it not a major percentage and would never will. Yes, some would say they can do better than EPF. I actually think that I can also do better too. Haha. I just do not believe these unit trust fund managers can be better than EPF every year, that’s all. Happy investing and believing in ourselves.
written on 12 Apr 2015
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