Committing to Singapore Properties

“It is not in case you buy but when you sell that makes distinction is the successful to your profit”.

Hence I consistently advise my investors to be sure they have gone through their financial plans thoroughly as they will be entering into a 4-year commitment – after with the 4-year Seller’s Stamp Duty (SSD) that they will need to pay if they sell their property before four years.

Once they have determined the amount of finances they are willing to outlay, they will set themselves at a boon by entering the property market and generating residual income from rental yields regarding putting their cash in the bank. Based on the current market, I would advise these people keep a lookout any kind of good investment property where prices have dropped an estimated 10% rather than putting it in a fixed deposit which pays 0.5% and does not hedge against inflation which currently stands at suggestions.7%.

In this aspect, my investors and I take prescription the same page – we prefer to probably the current low interest rate and put our take advantage property assets to produce a positive cash flow via rental income. I myself have personally seen some properties generating positive monthly cash flow of a whole lot $1500 after off-setting mortgage costs. This equates to an annual passive income up to $18 000 per annum which easily beats returns from fixed deposits plus outperforms dividend returns from stocks.

Even though prices of private properties have continued to elevate despite the economic uncertainty, we could see that the effect of the cooling measures have cause a slower rise in prices as compared to 2010.

Currently, we can see that although property prices are holding up, sales start to stagnate. Let me attribute this for the following 2 reasons:

1) Many owners’ unwillingness to sell at less expensive costs and buyers’ unwillingness to commit together with higher the price tag.

2) Existing demand unaltered data exceeding supply due to owners being in no hurry to sell, consequently in order to a rise in prices.

I would advise investors to view their Singapore property assets as long-term investments. They should not be excessively alarmed by a slowdown each morning property market as their assets will consistently benefit in time and increased value because of the following:

a) Good governance in Singapore

b) Land jade scape scarcity in Singapore, and,

c) Inflation which will place and upward pressure on prices

For clients who would like invest consist of types of properties aside from the residential segment (such as New Launches & Resales), they could also consider investing in shophouses which likewise assist generate passive income; and thus not prone to the recent government cooling measures such as the 16% SSD and 40% downpayment required on homes.

I cannot help but stress the value of having ‘holding power’. You must never be expected to sell your house (and create a loss) even during a downturn. Be aware that the property market moves in a cyclical pattern and you will need to sell only during an uptrend.