“It is not in case you buy but when you sell that makes learn 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 taking into consideration the 4-year Seller’s Stamp Duty (SSD) that they will need to 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 boon by entering the property market and generating passive income from rental yields regarding putting their cash secured. Based on the current market, I would advise they keep a lookout for good investment property where prices have dropped very 10% rather than putting it in a fixed deposit which pays 4.5% 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 pace 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 high as $1500 after off-setting mortgage costs. This equates with regard to an annual passive income all the way to $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 despite the economic uncertainty, we are able to access that the effect of the cooling measures have 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 into the following 2 reasons:
1) Many owners’ unwillingness to sell at affordable prices and buyers’ unwillingness to commit into a higher price.
2) Existing demand unaltered data exceeding supply due to owners finding yourself in no hurry to sell, jade scape consequently leading to a improve 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 in the property market as their assets will consistently benefit in the longer term and increase 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 besides the residential segment (such as New Launches & Resales), they likewise consider buying shophouses which likewise assist generate passive income; and therefore not at the mercy of the recent government cooling measures like the 16% SSD and 40% downpayment required on residential properties.
I cannot help but stress the significance of having ‘holding power’. You must never be forced 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.