“It is not calling it buy but when you sell that makes distinction is the successful 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 for the 4-year Seller’s Stamp Duty (SSD) that they will 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 great advantage by entering the property market and generating residual income from rental yields regarding putting their cash staying with you. Based on the current market, I would advise that they keep a lookout for good investment property where prices have dropped more than 10% rather than putting it in a fixed deposit which pays three.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 reap the benefits of the current low interest rate 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 as many as $1500 after off-setting mortgage costs. This equates a good annual passive income as high 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 elevate despite the economic uncertainty, we notice that the effect of the cooling measures have lead to a slower rise in prices as when compared with 2010.
Currently, jade scape we look at that although property prices are holding up, sales start to stagnate. I am going to attribute this to the following 2 reasons:
1) Many owners’ unwillingness to sell at affordable prices and buyers’ unwillingness to commit with a higher value tag.
2) Existing demand for properties 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. Dealerships will have not be excessively alarmed by a slowdown associated with property market as their assets will consistently benefit in the long run and boost in value because of 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 in addition to the residential segment (such as New Launches & Resales), they furthermore consider inside shophouses which likewise support generate passive income; are usually 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 need for having ‘holding power’. You must never be made to sell household (and make 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.