“It is not calling it buy but when you sell that makes principal 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 for 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 residual income from rental yields compared to putting their cash on your bottom line. Based on the current market, I would advise they will keep a lookout virtually any good investment property where prices have dropped more than 10% rather than putting it in a fixed deposit which pays two.5% and does not hedge against inflation which currently stands at some.7%.
In this aspect, my investors and I take any presctiption the same page – we prefer to reap the benefits of the current low price and put our benefit property assets to produce a positive cash flow via rental income. I myself have personally seen some properties generating positive monthly cash flow of a whole lot $1500 after off-setting mortgage costs. This equates with regard to an annual passive income up to $18 000 per annum which easily beats returns from fixed deposits as well outperforms dividend returns from stocks.
Even though prices of private properties have continued to increase despite the economic uncertainty, we could see that the effect of the cooling measures have can lead to a slower rise in prices as when compared with 2010.
Currently, we cane easily see that although property prices are holding up, sales start to stagnate. Let me attribute this for the following 2 reasons:
1) Many owners’ unwillingness to sell at lower prices and buyers’ unwillingness to commit into a higher the price tag.
2) Existing demand for properties exceeding supply due to owners finding yourself in no hurry to sell, consequently resulting in a embrace prices.
I would advise investors to view their jade scape singapore property assets as long-term investments. They should not be excessively alarmed by a slowdown within property market as their assets will consistently benefit in time and boost in value due to 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 aside from the residential segment (such as New Launches & Resales), they may also consider buying shophouses which likewise assist generate passive income; and thus not prone to the recent government cooling measures similar to the 16% SSD and 40% downpayment required on residential properties.
I cannot help but stress the importance of having ‘holding power’. You should never be required to sell your stuff (and make a loss) even during a downturn. Be aware that the property market moves in a cyclical pattern and really sell only during an uptrend.