Investing in Singapore Properties

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

Hence I consistently advise my investors to ensure that 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 would have 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 great advantage by entering the property market and generating second income from rental yields rather than putting their cash on your bottom line. Based on the current market, I would advise they will keep a lookout any kind of good investment property where prices have dropped very 10% rather than putting it in a fixed deposit which pays .5% and does not hedge against inflation which currently stands at simple.7%.

In this aspect, my investors and I are on the same page – we prefer to make the most of the current low rate and put our profit in 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 as high as $18 000 per annum which easily beats returns from fixed deposits as well outperforms dividend returns from stocks.

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

Currently, we observe that although property prices are holding up, sales start to stagnate. Let me attribute this towards following 2 reasons:

1) Many owners’ unwillingness to sell at lower prices and buyers’ unwillingness to commit with a higher price.

2) Existing demand for properties exceeding supply due to owners being in no hurry to sell, consequently resulting in a embrace prices.

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

a) Good governance in jade scape singapore

b) Land 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 apart from the residential segment (such as New Launches & Resales), they could also consider inside shophouses which likewise support generate passive income; and are not subject to the recent government cooling measures similar to the 16% SSD and 40% downpayment required on residential properties.

I cannot help but stress the significance of having ‘holding power’. You shouldn’t be forced to sell your house (and make 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.