“It is not when you buy but when you sell that makes principal 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 will have 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 second income from rental yields associated with 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 more than 10% rather than putting it in a fixed deposit which pays three.5% and does not hedge against inflation which currently stands at suggestions.7%.
In this aspect, my investors and I use the same page – we prefer to reap the benefits the current low price 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 as many as $1500 after off-setting mortgage costs. This equates a good annual passive income of up to $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 increase 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 are able to access that although property prices are holding up, sales are starting to stagnate. I am going to attribute this on the following 2 reasons:
1) Many owners’ unwillingness to sell at less expensive costs and buyers’ unwillingness to commit to some higher value tag.
2) Existing demand unaltered data exceeding supply due to owners being in no hurry to sell, consequently resulting in 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 your market property market as their assets will consistently benefit in the longer term and boost in value due to the 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 clients who would like invest consist of types of properties besides the residential segment (such as New Launches & Resales), they might also consider investing in shophouses which likewise can help generate passive income; and are not subject 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’. Never be expected to sell your stuff (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.