Uncategorized

Committing to Singapore Properties

“It is not calling it buy but when you sell that makes the difference to your profit”.

Hence I consistently advise my investors to take care that they have gone through their financial plans thoroughly as they will be entering into a 4-year commitment – after taking into consideration 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 gift by entering the property market and generating passive income from rental yields regarding putting their cash on your bottom line. Based on the current market, I would advise they will 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 three.5% and does not hedge against inflation which currently stands at simple.7%.

In this aspect, my investors and I take presctiption the same page – we prefer to probably the current low fee 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 of up to $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 and also outperforms dividend returns from stocks.

Even though prices of private properties have continued to elevate despite the economic uncertainty, we can easily see that the effect of the cooling measures have lead to a slower rise in prices as the actual 2010.

Currently, we can see that although property prices are holding up, sales start to stagnate. I am going to attribute this on the following 2 reasons:

1) Many owners’ unwillingness to sell at less expensive costs and buyers’ unwillingness to commit to a higher the price tag.

2) Existing demand for properties exceeding supply due to owners being in no hurry to sell, consequently leading to a improve prices.

I would advise investors to view their Singapore property assets as long-term investments. They should not be excessively alarmed by a slowdown each morning property market as their assets will consistently benefit in the long term and trend of value because of the following:

a) Good governance in jade scape singapore

b) Land scarcity in Singapore, and,

c) Inflation which will set and upward pressure on prices

For clients who would like invest some other types of properties apart from the residential segment (such as New Launches & Resales), they likewise consider purchasing shophouses which likewise can help generate passive income; and are not prone to 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’. Never be instructed to sell household (and develop a loss) even during a downturn. Remember that the property market moves in a cyclical pattern and really sell only during an uptrend.