Global Business Overview
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Questions and Answers

How do government regulations and tax laws influence the real estate market?

  • They have no significant impact on property demand.
  • They only stabilize the market during economic downturns.
  • They can amplify or mitigate impacts on the market. (correct)
  • They only affect residential properties.

What demographic factors can affect different types of real estate?

  • Age, income, and population size. (correct)
  • Technological advancements and education levels.
  • Temperature and weather patterns.
  • Historical events and cultural monuments.

What impact does urbanization have on property values?

  • It decreases property values in rural areas.
  • It has a negligible effect on the real estate market.
  • It increases demand in cities and subsequently property values. (correct)
  • It exclusively benefits commercial real estate.

Which factor is crucial for the stability of the real estate market in Japan?

<p>Strong regulations and market stability. (B)</p> Signup and view all the answers

How did Covid-19 influence the real estate market?

<p>It altered living and working patterns, leading to shifts in property demand and prices. (B)</p> Signup and view all the answers

What is one primary responsibility of a property agency?

<p>Manage Real Estate Salesperson's (RESs) activities (D)</p> Signup and view all the answers

Which of the following is true regarding Real Estate Salespersons (RESs)?

<p>They must pass the RES examination (A)</p> Signup and view all the answers

What distinguishes the legal obligations of property agencies from those of Real Estate Salespersons (RESs)?

<p>EAs have higher legal responsibilities (B)</p> Signup and view all the answers

Which of the following statements about the licensing of EAs and RESs is correct?

<p>EAs can employ multiple RESs under their license (A)</p> Signup and view all the answers

What is a significant difference in the scope of work between EAs and RESs?

<p>EAs have broader responsibilities including oversight of RESs (B)</p> Signup and view all the answers

What is required for a foreign investor to purchase property in Malaysia?

<p>Approval from the State Government and adherence to state price requirements (C)</p> Signup and view all the answers

What percentage of down payment is typically required from foreign purchasers in Malaysia?

<p>30% (C)</p> Signup and view all the answers

Which of the following is NOT a component of the project execution phase in property development?

<p>Navigating local market partnerships (C)</p> Signup and view all the answers

What is the role of the Foreign Investment Committee in property investments?

<p>To grant approvals for foreign investments based on local economic interests (A)</p> Signup and view all the answers

When should a homebuyer secure mortgage approval in Malaysia?

<p>Before receiving the Option to Purchase (OTP) (D)</p> Signup and view all the answers

What are the tax implications when purchasing property in Malaysia for foreigners?

<p>Stamp Duty applies to property purchases (A)</p> Signup and view all the answers

Which of these is an essential regulatory approval required before starting property development?

<p>Environmental impact assessment (D)</p> Signup and view all the answers

What is the purpose of the Option to Purchase (OTP) in the context of buying property?

<p>To offer a legal document for exclusive purchase rights (D)</p> Signup and view all the answers

What is one of the non-tax benefits of investing in a BOI company in Thailand?

<p>Visas and work permits (D)</p> Signup and view all the answers

Which of the following is a disadvantage of setting up a BOI company?

<p>Higher initial capital investment (B)</p> Signup and view all the answers

What is a common structure for companies that want to invest in property?

<p>Nominee structure (D)</p> Signup and view all the answers

Which of the following countries does not allow foreigners to purchase land outright?

<p>Vietnam (D)</p> Signup and view all the answers

Which taxation type is typically levied on property transactions?

<p>Stamp duties (C)</p> Signup and view all the answers

What is the purpose of land zoning in property development?

<p>To limit the development intensity on a site (D)</p> Signup and view all the answers

When repatriating funds from overseas property investments, which is a potential limitation?

<p>Availability of local currency (B)</p> Signup and view all the answers

What is the preferred debt to equity ratio for eligibility in BOI promotions?

<p>3:1 (A)</p> Signup and view all the answers

What is the primary purpose of groundbreaking in the construction stage?

<p>To officially begin construction (A)</p> Signup and view all the answers

Which of the following is a responsibility of buyers during the construction stage?

<p>Make periodic payments as per schedule (D)</p> Signup and view all the answers

What should buyers expect during the final inspection stage?

<p>A thorough inspection for defects or issues (D)</p> Signup and view all the answers

What is one of the ongoing responsibilities after the handover stage?

<p>Participating in community engagement activities (C)</p> Signup and view all the answers

What must buyers be aware of regarding potential customisation during construction?

<p>Options for customisation may be limited (D)</p> Signup and view all the answers

Which aspect is NOT typically included in post-handover responsibilities?

<p>Performing final inspections (B)</p> Signup and view all the answers

What are buyers required to monitor post-handover for potential opportunities?

<p>The property value for resale opportunities (C)</p> Signup and view all the answers

What guidelines do Estate Agents follow when marketing properties?

<p>Council of Estate Agents guidelines (A)</p> Signup and view all the answers

Which step in the property buying process involves legally binding both parties?

<p>Signing the contract and paying the deposit (A)</p> Signup and view all the answers

What is a notable difference between local and foreign buyers regarding FIRB?

<p>Foreign buyers must seek FIRB approval before purchasing property. (B)</p> Signup and view all the answers

Which of the following is essential when determining your budget for property purchase?

<p>Obtaining pre-approval for a mortgage. (D)</p> Signup and view all the answers

What is typically required from foreign buyers when acquiring a property that is not under construction or new?

<p>They must demolish existing structures first. (B)</p> Signup and view all the answers

What type of auction is commonly used for purchasing property in Australia?

<p>Open auction (D)</p> Signup and view all the answers

What is an ongoing expense associated with property ownership in Australia?

<p>Utility bills (D)</p> Signup and view all the answers

Which professional should you engage to handle legal aspects when purchasing property in Australia?

<p>Conveyancer or solicitor (C)</p> Signup and view all the answers

What is one of the reasons why foreign buyers may face tighter lending criteria compared to locals?

<p>They are often considered higher risk by lenders. (D)</p> Signup and view all the answers

In what situation can foreign buyers purchase established dwellings in Australia?

<p>If they plan to demolish and build more dwellings. (D)</p> Signup and view all the answers

Flashcards

Real Estate Market Factors

Factors like government regulations, demographics, urbanization, socio-cultural trends, geopolitical events, and significant events affect real estate markets. These factors either worsen or improve the real estate market impact.

Urbanization Impact

Growth of cities and infrastructure development increases demand for real estate, usually raising property values.

Government Regulations in Real Estate

Government rules and taxes influence real estate markets, impacting demand and pricing.

Global Real Estate Markets (Examples)

Specific countries like the US, UK, Australia, China, Japan, and the Middle East are major global real estate markets, each with its own characteristics and investment opportunities.

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Real Estate Market Uncertainty

Predicting future real estate market trends is hard and risky. Staying informed about current trends is a good strategy.

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Real Estate Agency (EA)

A licensed entity that manages real estate transactions and oversees real estate salespeople.

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Real Estate Salesperson (RES)

A registered professional who connects buyers and sellers for property transactions.

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Registration for Real Estate Salesperson (RES)

Process to become a registered real estate salesperson, under an EA.

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EA's Responsibility

Overseeing and ensuring the actions of its affiliated RESs and adhering to regulations.

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Key Difference: EA vs. RES

EAs oversee and have broader responsibilities than RESs, who focus on client interactions and transactions.

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Progressive Payments

Buyers make periodic payments during construction according to the schedule.

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Final Inspection

Thorough check of the unit to find defects before handover.

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Final Payment

Payment adjustment, or additional fees are determined after final inspection

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Ongoing Maintenance

Recurring fees for maintaining the property after handover.

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Construction Timeline

The expected time frame for construction.

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Construction Quality

Standards that must be met during construction.

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Property Handover

The process of giving the buyer the property and keys.

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Estate Agent

Facilitates property transactions.

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Foreign Investment Compliance in Malaysia

Following rules set for foreign investors buying property in Malaysia.

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Regulatory Approvals for Property in Malaysia

Getting necessary permission like environmental checks and zoning for building/property

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Local Partnership for Market Entry

Working with local businesses to sell products/services in a country

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Land Acquisition for Investment

Securing land for investment in Malaysia. Requires foreign committee approval.

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Property Purchase Process (Malaysia)

Steps for purchasing a property in Malaysia, including offer, approval, financing, and transfer of ownership

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Foreign Ownership Restrictions in Malaysia

Rules about foreigners owning Malaysian property (e.g., minimum price)

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Property Taxes in Malaysia

Taxation (e.g., Stamp Duty) for property transactions in Malaysia.

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Company Registration (Malaysia)

Process for registering a business or company in Malaysia.

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Foreign Ownership Restrictions in Australia

Strict rules limit foreign buyers in purchasing certain properties, particularly established dwellings, except for demolition and new builds or for those living temporarily in Australia. Foreigners can buy vacant land and new buildings.

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Private Treaty Sale in Australia

A common way to buy property in Australia where the seller can accept or reject offers from potential buyers.

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Off-the-Plan Purchase

Common for new residential development, where buyers purchase a property before construction is complete. It offers potential cost savings but has risks like construction delays and market condition changes.

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Auction in Australia

A property buying method where the highest bidder wins the auction.

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Conveyancer or Solicitor

They handle the legal aspects of real estate transactions, ensuring everything is legally sound.

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FIRB Pre-Approval

Foreign Investment Review Board (FIRB) approval needed for foreign buyers to purchase property in Australia, preventing delays in the process.

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Property Inspections

Essential for buyers to assess the condition of a property before purchasing, including inspections for building issues and pests.

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Mortgage Provider

A financial institution that provides loans for property purchase.

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Buyer's Agent

A professional who helps buyers find and negotiate property purchases, providing valuable market knowledge and expertise.

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Stamp Duty for Foreign Buyers

Foreign buyers often face additional stamp duty surcharges on top of the regular stamp duty, depending on the state.

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BOI Company

A company registered with the Board of Investment (BOI) in Thailand, offering tax and non-tax benefits for foreign investment in eligible businesses.

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BOI Company Benefits

BOI companies receive incentives like tax exemptions, foreign ownership rights, and simplified visa processes for foreign investors.

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BOI Company Eligibility

To qualify for BOI status, companies should engage in specific business activities, possess a certain debt-to-equity ratio, and fulfill minimum capital investment requirements.

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BOI Company Disadvantages

Setting up a BOI company can be complex, requiring extensive documentation and time. It also involves separate accounting and frequent inspections to ensure compliance.

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Foreign Ownership of Property

In many countries, foreigners face restrictions on property ownership, requiring special structures or agreements to acquire property.

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Nominee Structure

A nominee structure is used for property investment, where a local entity (nominee) holds ownership of the property on behalf of the foreign investor.

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Repatriation of Money

The process of transferring investment profits or proceeds back to the investor's home country, often involving currency exchange and bank fees.

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Foreign Exchange Rate

The exchange rate between the currency of the country where the investment is located and the investor's home currency.

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Study Notes

Global Business

  • Global business involves exchanging goods and services across international borders.
  • Global companies operate internationally, with branches or offices in multiple countries.
  • They leverage competitive advantages to thrive in a rapidly interconnected world economy.

Characteristics of Global Business

  • Companies operate in multiple countries.
  • They meet diverse customer needs/preferences across cultures in multiple territories.
  • Businesses adapt to different languages and cultural norms.
  • Corporations must follow trade restrictions and regulations in each country.
  • Managing diverse suppliers/vendors in various countries creates a complex supply chain.
  • Competition with local and international players is a key challenge.
  • Global operations require skilled managers with expertise in coordinating across borders.
  • Firms must consider the social and environmental effects of their business practices.

Importance of Global Business

  • Drives economic growth, generates employment, and enhances productivity.
  • Companies access new markets, expand sales, and increase profits.
  • Sharing knowledge and ideas leads to innovation and improvement across cultures.
  • Utilizing cost-effective labor and materials from diverse geographic locations is a key benefit.
  • Global competition forces companies to improve their products, services, and operations to stay ahead.
  • Cultural exchange and interaction between individuals in global operations promote mutual understanding.
  • Consumers benefit from wider access to a variety of products and services.
  • Investing in foreign assets and businesses creates diverse investment opportunities in global settings.
  • Businesses must adopt sustainable practices and environmental/social responsibility in their global operations.

SG as a Hub for Global Business

  • Singapore's strategic location within major global markets provides easy access for business interactions.
  • The stable political and economic environment translates to lower corruption and robustness.
  • Pro-business policies, tax incentives, and ease of doing business attract global companies.
  • Singapore's skilled and educated workforce attracts talent and expertise from across the globe.
  • A transparent and straightforward regulatory environment promotes faster business establishment.

Global Real Estate Business

  • Globalization of the real estate sector is increasingly evident through cross-border investment flows.
  • Rapid urbanization and technological advancements, especially in proptech, drive accessibility for foreign investors.
  • Collaboration between various real estate firms and international investors influences the dynamics of real estate.
  • Diverse portfolios of properties across different countries are a hallmark of globalization of real estate business.
  • Education and training programs are now offered globally in various real estate fields.
  • Diversification of investments to mitigate risks and enhance returns in real estate is a notable trend.
  • Increase in market penetration, customer acquisition, and brand/revenue gains are primary goals in real estate.
  • Knowledge exchange, and better use of technology and innovation in real estate are becoming key.
  • Global regulations contribute to attracting foreign investments.
  • Global real estate business types include: consultancy, brokerage, property management, development, investment and management, and related technologies.

Motivations for Going Overseas

  • Market diversification.
  • Growth potential.
  • Market penetration (to increase customer base/brand/revenue).
  • Expertise and innovation to stay competitive.
  • Synergies and economy from operating in several markets.
  • Regulatory and tax considerations to maximize financial benefits and minimize risk.
  • Building a global network.

Types of Global Real Estate Business

  • Consultancy services for investment and development strategy.
  • Brokerage or agency services for property sales and leasing.
  • Property management services to handle day-to-day operations.

Real Estate Market Overview

  • Economic decisions, interest rates, government policies, and demographics significantly influence the real estate market(residential, commercial, industrial, agricultural).
  • Urbanization and infrastructure development are major drivers of real estate demand and valuation growth.
  • Socio-cultural and geopolitical factors impacting real estate markets include remote working trends, political stability, international relations, and conflicts.
  • The COVID-19 pandemic has altered living and working patterns, leading to shifts in property demand and price trends.
  • Global real estate markets have differing characteristics, and some, like those in the United States, remain robust.
  • Some key challenges in developing real estate markets include higher volatility, less mature markets, and risk of higher instability.
  • Conversely, developed markets offer relatively stable, mature, transparent and predictable returns, but also have lower growth potential.

Buying Foreign Property

  • Review options for potential properties.
  • Determine a realistic budget.
  • Understand local regulations and legal requirements.
  • Use due diligence to assess risks & conditions.
  • Consider agent(s) and legal representatives for support.
  • Financing (check loan approval availability, etc).

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Description

This quiz explores the essential concepts and characteristics of global business operations. Learn how companies navigate international trade, cultural diversity, and competitive challenges. Understand the importance of skilled management and regulatory compliance in a global economy.

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