“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 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 boon by entering the property market and generating a second income from rental yields associated with putting their cash secured. Based on the current market, I would advise these people keep a lookout any kind of good investment property where prices have dropped upwards of 10% rather than putting it in a fixed deposit which pays .5% and does not hedge against inflation which currently stands at ideas.7%.
In this aspect, my investors and I take any presctiption the same page – we prefer to take advantage of the current low price and put our take advantage 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 high as $1500 after off-setting mortgage costs. This equates to an annual passive income up to $18 000 per annum which easily beats returns from fixed deposits additionally the 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 the actual 2010.
Currently, we look at that although property prices are holding up, sales are beginning to stagnate. Let me attribute this towards following 2 reasons:
1) Many owners’ unwillingness to sell at lower prices and buyers’ unwillingness to commit with a higher value tag.
2) Existing demand for properties exceeding supply due to owners being in no hurry to sell, consequently resulting in 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 each morning property market as their assets will consistently benefit in the long run and trend of value due to the following:
a) Good governance in Singapore
b) Land scarcity in Singapore, jade scape and,
c) Inflation which will set and upward pressure on prices
For buyers who would like invest consist of types of properties apart from the residential segment (such as New Launches & Resales), they furthermore consider throughout shophouses which likewise support generate passive income; that are not depending upon the recent government cooling measures prefer the 16% SSD and 40% downpayment required on homes.
I cannot help but stress the need for having ‘holding power’. You shouldn’t be made to sell your stuff (and make a loss) even during a downturn. Always remember that the property market moves in a cyclical pattern and it’s sell only during an uptrend.