"It is not when you 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 would have 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 gift by entering the property market and generating residual income from rental yields instead of putting their cash secured. Based on the current market, I would advise they keep a lookout any kind of good investment property where prices have dropped a great deal more 10% rather than putting it in a fixed deposit which pays 4.5% and does not hedge against inflation which currently stands at 5.7%.
In this aspect, my investors and I take presctiption the same page - we prefer to reap the benefits of the current low interest rate and put our profit 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 as many as $1500 after off-setting mortgage costs. This equates to an annual passive income all the way to $18 000 per annum which easily beats returns from fixed deposits additionally the outperforms dividend returns from stocks.
Even though prices of private properties have continued to go up despite the economic uncertainty, we can see that the effect of the cooling measures have cause a slower rise in prices as in order to 2010.
Currently, we look at that although property prices are holding up, sales are starting to stagnate. Let me attribute this into the following 2 reasons:
1) Many owners' unwillingness to sell at less expensive 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 leading to a increase 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 your market property market as their assets will consistently benefit in time and increase in value because of the following:
a) Good governance in Singapore
b) Land scarcity in Singapore, jade scape and,
c) Inflation which will place and upward pressure on prices
For clients who would like invest in other types of properties besides the residential segment (such as New Launches & Resales), they likewise consider purchasing shophouses which likewise support generate passive income; and therefore not subject to the recent government cooling measures a lot 16% SSD and 40% downpayment required on homes.
I cannot help but stress the significance of having 'holding power'. Never be expected to sell house (and create a loss) even during a downturn. Be aware that the property market moves in a cyclical pattern and require to sell only during an uptrend.