“It is not when you buy but when you sell that makes learn 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 for 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 residual income from rental yields compared to putting their cash secured. Based on the current market, I would advise they keep a lookout virtually any good investment property where prices have dropped more than 10% rather than putting it in a fixed deposit which pays 4.5% and does not hedge against inflation which currently stands at some.7%.
In this aspect, my investors and I take presctiption the same page – we prefer to make the most of the current low price and put our make the most property assets to generate a positive cash flow via rental income. I myself have personally seen some properties generating positive monthly cash flow of up to $1500 after off-setting mortgage costs. This equates with regard to an annual passive income as much as $18 000 per annum which easily beats returns from fixed deposits additionally the outperforms dividend returns from stocks.
Even though prices of private properties have continued to increase despite the economic uncertainty, we can easily see that the effect of the cooling measures have lead to a slower rise in prices as when compared with 2010.
Currently, we cane easily see that although property prices are holding up, sales are starting to stagnate. I will attribute this into the following 2 reasons:
1) Many owners’ unwillingness to sell at more affordable prices and buyers’ unwillingness to commit to a higher charges.
2) Existing demand for properties exceeding supply due to owners finding yourself in no hurry to sell, consequently in order to a increase prices.
I would advise investors to view their Singapore property assets as long-term investments. Will need to not be excessively alarmed by a slowdown associated with property market as their assets will consistently benefit in the longer term and increase in value as a result of following:
a) Good governance in Singapore
b) Land scarcity in jade scape singapore, and,
c) Inflation which will place and upward pressure on prices
For buyers who would like invest various other types of properties besides the residential segment (such as New Launches & Resales), they furthermore consider buying shophouses which likewise can help generate passive income; that are not prone to the recent government cooling measures such as the 16% SSD and 40% downpayment required on residential properties.
I cannot help but stress the value of having ‘holding power’. You shouldn’t be instructed to sell house (and make a loss) even during a downturn. Remember that the property market moves in a cyclical pattern and it’s sell only during an uptrend.