“It is not an individual have buy but when you sell that makes the gap to your profit”.
Hence I consistently advise my investors to be sure 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 must 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 boon by entering the property market and generating second income from rental yields rather than putting their cash secured. Based on the current market, I would advise that 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 two.5% and does not hedge against inflation which currently stands at simple.7%.
In this aspect, my investors and I take prescription the same page – we prefer to probably the current low fee 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 up to $1500 after off-setting mortgage costs. This equates for annual passive income as high as $18 000 per annum which easily beats returns from fixed deposits and also 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 can lead to a slower rise in prices as in order to 2010.
Currently, we look at that although property prices are holding up, sales are beginning to stagnate. I will attribute this on the following 2 reasons:
1) Many owners’ unwillingness to sell at lower prices and buyers’ unwillingness to commit to a higher value tag.
2) Existing demand for properties exceeding supply due to owners finding yourself in no hurry to sell, consequently resulting in a improve 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 over time and increasing amount of 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 buyers who would like invest some other types of properties in addition to the residential segment (such as New Launches & Resales), they might also consider investing in shophouses which likewise assist generate passive income; are usually not at the mercy of 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’. Never be expected to sell your house (and create a loss) even during a downturn. Remember that the property market moves in a cyclical pattern and really sell only during an uptrend.