“It is not in case you buy but when you sell that makes the difference to your profit”.
Hence I consistently advise my investors to be certain 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 will need 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 advantage by entering the property market and generating residual income from rental yields compared to putting their cash staying with you. Based on the current market, I would advise may keep a lookout virtually any good investment property where prices have dropped an estimated 10% rather than putting it in a fixed deposit which pays 4.5% and does not hedge against inflation which currently stands at 5.7%.
In this aspect, my investors and I take prescription the same page – we prefer to reap the benefits of the current low fee and put our money in 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 all the way 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 increase despite the economic uncertainty, we notice that the effect of the cooling measures have result in a slower rise in prices as in order to 2010.
Currently, we can see that although property prices are holding up, sales are starting to stagnate. Let me attribute this to the following 2 reasons:
1) Many owners’ unwillingness to sell at more affordable prices and buyers’ unwillingness to commit together with higher promoting.
2) Existing demand for properties exceeding supply due to owners finding yourself in no hurry to sell, consequently leading to a rise in prices.
I would advise investors to view their Singapore property assets as long-term investments. They ought to not be excessively alarmed by a slowdown within property market as their assets will consistently benefit in over time and trend of value due to the following:
a) Good governance in jade scape singapore
b) Land scarcity in Singapore, and,
c) Inflation which will set and upward pressure on prices
For buyers who would like invest in other types of properties besides the residential segment (such as New Launches & Resales), they could also consider purchasing shophouses which likewise support generate passive income; that are not at the mercy of 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 should never be expected to sell your stuff (and make a loss) even during a downturn. Always remember that the property market moves in a cyclical pattern and you should sell only during an uptrend.