The View | Trump-driven uncertainty puts Asia’s property markets under pressure

Even safe havens such as Japan, Australia and Singapore are under scrutiny as a more challenging global economic landscape emerges

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Pedestrians cross the street in the popular shopping district of Ginza, in central Tokyo, on August 16, 2024. Photo: AFP

Published: 4:30pm, 27 Jan 2025

Divergent views on Asia’s property markets abound. Deep uncertainty about how much of US President Donald Trump’s “America first” agenda will be implemented, and what the impact will be on the US economy and the rest of the world, is clouding the outlook for the region’s real estate sector.

Adding to the uncertainty is the fact there are significant differences between and within Asia’s developed and developing markets, and that other factors – property fundamentals, government policies and market idiosyncrasies – have a strong bearing on the performance of the sector.

It is clear there is a wide range of plausible scenarios. JLL property agency is the most optimistic. In its latest quarterly report on Asia’s commercial property investment markets, it said that “this year, the fear of missing out will be overtaking the fear of making a mistake” as favourable supply and demand dynamics in many markets create attractive opportunities for investment.

Knight Frank, on the other hand, is more sceptical. It noted that “barriers still exist that may result in a more gradual recovery of cross-border real estate investment rather than a sharp, V-shaped rebound”.

However, investors and advisers see eye to eye when it comes to markets that are likely to benefit from more geopolitical and economic uncertainty. The findings of two surveys carried out after Trump’s election victory show Japan is best placed to weather the external headwinds.

The results of a poll by the Asian Association for Investors in Non-Listed Real Estate Vehicles revealed that residential and commercial properties in Tokyo and Osaka accounted for six of the top 10 preferred city-sector combinations for investment in Asia. Another survey, by CBRE, showed that Tokyo is the most popular destination for cross-border investment among Asia’s leading cities.