“It is not when you buy but when you sell that makes learn 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 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 gift by entering the property market and generating passive income from rental yields instead of putting their cash in the bank. Based on the current market, I would advise that they keep a lookout for any good investment property where prices have dropped upwards of 10% rather than putting it in a fixed deposit which pays two.5% and does not hedge against inflation which currently stands at some.7%.
In this aspect, my investors and I are on the same page – we prefer to take advantage of the current low pace 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 a whole lot $1500 after off-setting mortgage costs. This equates with regard to an annual passive income of up to $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 are able to access that the effect of the cooling measures have result in a slower rise in prices as in comparison to 2010.
Currently, we are able to access that although property prices are holding up, sales are beginning 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 to some higher the price tag.
2) Existing demand unaltered data 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 should not be excessively alarmed by a slowdown associated with property market as their assets will consistently benefit in the long run and increased value as a result of following:
a) Good governance in jade scape singapore
b) Land scarcity in Singapore, and,
c) Inflation which will place and upward pressure on prices
For buyers who would like invest in other types of properties apart from the residential segment (such as New Launches & Resales), they may also consider buying shophouses which likewise can help generate passive income; and therefore not depending upon the recent government cooling measures like the 16% SSD and 40% downpayment required on residential properties.
I cannot help but stress the importance of having ‘holding power’. You should never be forced to sell your house (and create a loss) even during a downturn. Remember that the property market moves in a cyclical pattern and you will need to sell only during an uptrend.