2. Indirect Real Estate Investment Performance Decision in Malaysia by Using Data Science
AGENDA SUMMARY
BEGI
N
Problem
Statemen
t
Data Science
Technique
Collect
Data
Predict
Buy Sell
Review
Past
Historical
Data
END
Benefit
s
Introduction
Direct vs
Indirect Real
Estate
Investment
Machine
Learning
Analyze and
Reproducible
Method
Limitation
and Future
Study
Q&A
Predict
Future
Price
3. Indirect Real Estate Investment Performance Decision in Malaysia by Using Data Science
• Acquisition of participating interests through the main stock
exchange, where the investor is only interested in property
shares or indirectly interested in so-called “listed real
estate”.
• Eg. Real Estate Investment Trust (REIT), Developer
Stocks, Unit Trust – Real Estate Assets.
• Active – private equity, joint decisions on acquire, holding
and management of real estate.
• Passive – such as public shareholders, institution investors
that do not have any operational involvement in
investment.
Introduction
Indirect Real Estate Investment
Direct
Investor holds real
estate under own
name
Indirect
Investor holds an
interest in a vehicle,
which holds the real
estate
Investor Investor
Vehicle
4. Indirect Real Estate Investment Performance Decision in Malaysia by Using Data Science
Inflation Rate
Cost living is getting higher, real estate
known as an asset that can hedge inflation.
Retirement Plan
Direct real estate investment financing is
limited, required large fund to acquired
directly.
Expected Return (FD 3.25%)
Expected return for direct real estate is
more than 6% annual yield. Current market
is lower than expected, average is less than
4%.
Information
Information is everywhere. How reliable are
them?
Problem Statement
Common Issue or Known Issue
⊷
5. Indirect Real Estate Investment Performance Decision in Malaysia by Using Data Science
Direct or Indirect Real Estate Investment Pros and Cons
Direct Indirect
Cost Large fund to obtain real estate. Lower up-front capital investment.
Leveraging High Leverage, borrow loan up to
90% for residential and commercial
up to 75%.
Low Leverage, can use margin to
invest in stock market.
Asset Liquidity Take time to sell, minimum period
to complete one transaction is 4
months.
Improved asset liquidity. There is
an active market for stocks that
significantly easier to sell them
quickly and cost effective.
Management Cost Manage yourself. Paying
maintenance fees, look for tenant,
and etc.
There is a management to manage
everything for you.
6. Indirect Real Estate Investment Performance Decision in Malaysia by Using Data Science
• To identify the top 5 REITs and top 5 Developer stocks expected return that more than 6%
annually.
• To finding the correlation within REITs and Developer stocks average adjusted price compare to
the direct real estate investment factors which included population, household income, GDP,
risk free rate and house price index.
• Allocation fund into top 5 best performance into portfolio management matrix formula.
• Predict the top five best performance REITs/Stocks’s price that been selected.
Objective and Finding
For this research paper
7. Indirect Real Estate Investment Performance Decision in Malaysia by Using Data Science
What is data science?
Also known as data-driven science about scientific
methods, processes and systems to extract knowledge or
insights from data in various forms either unstructured or
structured.
What can be data science help in this research?
Data sciences technique could provide more high quality
information with the right big data that specific into
velocity, variety and volume. It is also could find hidden
patterns and tell the result insight that drive the
information.
Data Science
Data-Driven
8. Indirect Real Estate Investment Performance Decision in Malaysia by Using Data Science
Data science can be reproducible
The research could be continue by someone else. Script/Code upload to GitHub for someone to
extract and continue the research that been done from the past.
Data Science Lifecycle
Reproducible
Raw Data
Collected
Data
Processed
Modeling & Algorithms
(Machine Learning)
Visualizatio
n/Report
Data
Product
Exploratory
Data
Analysis
Clean
Dataset
Make Decisions
GitHub
(Open
Source
Community)
9. Indirect Real Estate Investment Performance Decision in Malaysia by Using Data Science
Limitation and Future Study
• Various country might have different factors to impact the result.
• 5 factors that might be a gap for impact the result.
• Only focus on Malaysia. Other factors like other country economic
may impact the result. Such as Singapore or US market that have
significant impact of Malaysia economic.
• Extend more study that include more factors into.
10. Go ahead. Ask away.
Give me your best shot.
QUESTIONS
AND
ANSWERS
Where I hope you’ll find the answer
to any question you may have about
