“It is not an individual have 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 with the 4-year Seller’s Stamp Duty (SSD) that they would have to pay if they sell their property before four 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 residual income from rental yields regarding putting their cash in the bank. Based on the current market, I would advise these people keep a lookout virtually any good investment property where prices have dropped upwards of 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 take prescription the same page – we prefer to reap the benefits of the current low price 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 with regard to an annual passive income as much as $18 000 per annum which easily beats returns from fixed deposits furthermore 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 compared to 2010.
Currently, we can see 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 less expensive prices and buyers’ unwillingness to commit together with 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. Really should not be excessively alarmed by a slowdown each morning property market as their assets will consistently benefit in over time and increased value due to the following:
a) Good governance in Singapore
b) Land scarcity in Singapore, and,
c) Inflation which will place and upward pressure on prices
For buyers who would like invest some other types of properties besides the residential segment (such as New Launches & Resales), they could also consider buying shophouses which likewise can help generate passive income; and thus not controlled by the recent government cooling measures like the 16% SSD and 40% downpayment required on residential properties.
I cannot help but stress the value of having ‘holding power’. You should never be made to sell house (and jade scape create a loss) even during a downturn. Be aware that the property market moves in a cyclical pattern and require to sell only during an uptrend.