“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 certain 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 must pay if they sell their property before four 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 a second income from rental yields rather than putting their cash on your bottom line. Based on the current market, I would advise these people keep a lookout any kind of 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 reap the benefits the current low price and put our take advantage 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 caused a slower rise in prices as in comparison to 2010.
Currently, we look at that although property prices are holding up, sales are beginning to stagnate. I will attribute this into the following 2 reasons:
1) Many owners’ unwillingness to sell at more affordable prices and buyers’ unwillingness to commit with a higher value tag.
2) Existing demand unaltered data exceeding supply due to owners being in no hurry to sell, consequently in order to a embrace prices.
I would advise investors to view their Singapore property assets as long-term investments. Will need to not be excessively alarmed by a slowdown within property market as their assets will consistently benefit in over time and trend of value as a result of following:
a) Good governance in jade scape singapore
b) Land scarcity in Singapore, and,
c) Inflation which will place and upward pressure on prices
For clients who would like invest various other types of properties in addition to the residential segment (such as New Launches & Resales), they furthermore consider purchasing shophouses which likewise support generate passive income; that are not depending upon the recent government cooling measures similar to 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 create a loss) even during a downturn. Always remember that the property market moves in a cyclical pattern and require to sell only during an uptrend.