“It is not calling it buy but when you sell that makes the difference 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 gift by entering the property market and generating a second income from rental yields instead of putting their cash in the bank. Based on the current market, I would advise they keep a lookout for good investment property where prices have dropped more than 10% rather than putting it in a fixed deposit which pays 0.5% and does not hedge against inflation which currently stands at some.7%.
In this aspect, my investors and I use the same page – we prefer to make the most of the current low rate and put our make the most 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 with regard to an annual passive income as much as $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 increase despite the economic uncertainty, we notice that the effect of the cooling measures have result in a slower rise in prices as when compared with 2010.
Currently, we are able to access that although property prices are holding up, sales are beginning to stagnate. I am going to attribute this into the following 2 reasons:
1) Many owners’ unwillingness to sell at affordable prices and buyers’ unwillingness to commit into a higher value tag.
2) Existing demand for properties exceeding supply due to owners finding yourself 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. Dealerships will have not be excessively alarmed by a slowdown each morning property market as their assets will consistently benefit in the long run and boost in value due to the following:
a) Good governance in Singapore
b) Land scarcity in Singapore, and,
c) Inflation which will set and upward pressure on prices
For jade scape clients who would like invest various other types of properties aside from the residential segment (such as New Launches & Resales), they furthermore consider throughout shophouses which likewise assist generate passive income; and therefore not depending upon the recent government cooling measures prefer the 16% SSD and 40% downpayment required on residential properties.
I cannot help but stress the significance of having ‘holding power’. You shouldn’t be made to sell your stuff (and create a loss) even during a downturn. Be aware that the property market moves in a cyclical pattern and really sell only during an uptrend.