“It is not calling it buy but when you sell that makes the gap to your profit”.
Hence I consistently advise my investors to ensure that 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 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 residual income from rental yields regarding putting their cash secured. Based on the current market, I would advise these people keep a lookout for any 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 5.7%.
In this aspect, my investors and I are on the same page – we prefer to probably the current low interest rate and put our profit 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 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 can see that the effect of the cooling measures have lead to a slower rise in prices as the actual 2010.
Currently, we are able to access that although property prices are holding up, sales start to stagnate. Let me attribute this towards following 2 reasons:
1) Many owners’ unwillingness to sell at more affordable prices and buyers’ unwillingness to commit together with higher price.
2) Existing demand unaltered data exceeding supply due to owners being in no hurry to sell, consequently in order to 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 in the property market as their assets will consistently benefit in over time and increasing amount of value as a result of following:
a) Good governance in Singapore
b) Land scarcity in jade scape singapore, and,
c) Inflation which will place and upward pressure on prices
For buyers who would like invest some other types of properties apart from the residential segment (such as New Launches & Resales), they could also consider throughout shophouses which likewise assist 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 importance of having ‘holding power’. You shouldn’t ever be forced to sell your property (and make a loss) even during a downturn. Be aware that the property market moves in a cyclical pattern and it’s sell only during an uptrend.