Given the outsize influence of US monetary policy on the global economy and with the US dollar remaining the main currency for worldwide trade, the Fed’s decision is likely to trigger similar easing steps for other central banks. Add in the complexities of regulation, taxation and borrowing across borders, and investors considering property assets across the globe must plan carefully, according to Liam Bailey, global head of research at Knight Frank.
“Investors need to think very clearly about their objectives,” he said. “What are they seeking to achieve? Is the investment about securing an income stream, or capital growth or about a defensive strategy – to put money into what they perceive as a safe-haven market?”
Across all markets, investors must engage in deep research, considering currency impacts, entry and exit taxes, financing, running costs and liquidity, he said. “Treat policy as a live variable rather than a constant,” he added.
For investors based in Hong Kong, where the local currency is pegged to the US dollar, it was imperative to be savvy and watchful for any sudden shift in US monetary policy, advisers said.