02 Nov

Investing in Singapore Properties

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

Hence I consistently advise my investors to guantee that they have gone through their financial plans thoroughly as they will be entering into a 4-year commitment – after taking into consideration the 4-year Seller’s Stamp Duty (SSD) that they will want to pay if they sell their property before 4 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 passive income from rental yields instead of putting their cash secured. Based on the current market, I would advise that they 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 three.5% and does not hedge against inflation which currently stands at ideas.7%.

In this aspect, my investors and I use the same page – we prefer to reap the benefits the current low rate and put our take advantage property assets to generate a positive cash flow via rental income. I myself have personally seen some properties generating positive monthly cash flow of of up to $1500 after off-setting mortgage costs. This equates for 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 go up despite the economic uncertainty, we could see that the effect of the cooling measures have can lead to a slower rise in prices as the actual 2010.

Currently, we are able to access 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 lower prices and buyers’ unwillingness to commit to a higher charges.

2) Existing demand jade scape unaltered data exceeding supply due to owners finding yourself in no hurry to sell, consequently leading to a embrace prices.

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

a) Good governance in Singapore

b) Land scarcity in Singapore, and,

c) Inflation which will place and upward pressure on prices

For clients who would like invest in other types of properties in addition to the residential segment (such as New Launches & Resales), they furthermore consider inside shophouses which likewise will help generate passive income; are usually not at the mercy of the recent government cooling measures a lot 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 house (and make a loss) even during a downturn. Always remember that the property market moves in a cyclical pattern and you will need to sell only during an uptrend.