Where investors should put their money in 2015

Given the current status of the residential property market both here in Singapore and in China, 2015 will see investors continue to shift towards commercial real estate markets, such as hotel investments, outside of Singapore.

Hotel investments are not new to investors, and have been undertaken by business leaders such as Donald Trump and brands such as Ritz Carlton and Radisson, although with very high entry prices averaging US$1million.

For Asia in the current market, products offering lower entry fees to a clearly defined luxury hotel buy-to-let investment solution will be attractive as a robust investment opportunity for investors trying to "beat-the-bank".

As compared with last year, hotel investments have witnessed a 200% increase in the Asia Pacific region. For 2015, we will see the volumes of hotel investments tipped to rise even further.

What makes it a good investment idea?

As property prices and rental yields continue to weaken, property investors will move away from local buy-to-let residential property due to a combination of the downward price movement, ongoing costs, and the inherent hassles of having to look for new tenants and upkeep.

In Singapore in particular, there is currently an oversupply of 30,000-40,000 units with the vacancy level set to increase to around 11% from the current 7%.

Buy-to-let hotel investments are hassle-free due to having experienced hotel management carrying almost all of the responsibilities, and also the flexibility of prices that can adjust accordingly with inflation and other variables.

Tourist meccas such as Phuket are a strong focus for this type of investment, with its incredibly high occupancy rate, and inflow of high-end Eastern European and Asian clientele making the luxury hotel space incredibly robust. Additionally, returns generated from overseas investments are tax-free for Singaporeans.

The definition of a good investment essentially depends on the expectations and risk appetite of the investor. If your goal is to beat inflation, then hotel investments are certainly attractive by beating the bank's returns currently averaging around 0%.

With the right type of alternative investment like this requiring minimum management whilst still offering strong security and risk management, you can rest easy with the knowledge that your investments are well-taken care of.