“It is not an individual have buy but when you sell that makes distinction is the successful 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 would 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 advantage by entering the property market and generating second income from rental yields regarding putting their cash in the bank. Based on the current market, I would advise these people keep a lookout regarding any good investment property where prices have dropped very 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 use the same page – we prefer to reap the benefits 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 as high as $1500 after off-setting mortgage costs. This equates 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 notice that the effect of the cooling measures have result in a slower rise in prices as when compared with 2010.
Currently, we can see that although property prices are holding up, sales are beginning to stagnate. I’m going to attribute this towards following 2 reasons:
1) Many owners’ unwillingness to sell at less expensive prices and buyers’ unwillingness to commit with a higher value tag.
2) Existing demand jade scape unaltered data exceeding supply due to owners finding yourself in no hurry to sell, consequently in order to a increase prices.
I would advise investors to view their Singapore property assets as long-term investments. Dealerships will have not be excessively alarmed by a slowdown in the property market as their assets will consistently benefit in over time and increase in value as a result of following:
a) Good governance in Singapore
b) Land scarcity in Singapore, and,
c) Inflation which will set and upward pressure on prices
For clients who would like invest in other types of properties in addition to the residential segment (such as New Launches & Resales), they likewise consider buying shophouses which likewise might help generate passive income; and thus not at the mercy of the recent government cooling measures such as the 16% SSD and 40% downpayment required on residential properties.
I cannot help but stress the need for having ‘holding power’. You must never be required to sell household (and develop a loss) even during a downturn. Always remember that the property market moves in a cyclical pattern and you should sell only during an uptrend.