“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 taking into consideration 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 advantage by entering the property market and generating second income from rental yields associated with putting their cash in the bank. Based on the current market, I would advise they 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 ideas.7%.
In this aspect, my investors and I take presctiption the same page – we prefer to make the most of the current low rate and put our take advantage property assets to produce 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 a good annual passive income of up 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 rise despite the economic uncertainty, we can see that the effect of the cooling measures have cause a slower rise in prices as in comparison to 2010.
Currently, we observe that although property prices are holding up, sales are beginning to stagnate. I’m going to attribute this for the following 2 reasons:
1) Many owners’ unwillingness to sell at less expensive costs and buyers’ unwillingness to commit with a higher price.
2) Existing demand for properties exceeding supply due to owners being in no hurry to sell, consequently resulting in a increase prices.
I would advise investors to view their jade scape singapore property assets as long-term investments. Will need to not be excessively alarmed by a slowdown each morning property market as their assets will consistently benefit in over time and boost in value as a result of following:
a) Good governance in Singapore
b) Land scarcity in Singapore, and,
c) Inflation which will set and upward pressure on prices
For clients who would like invest consist of types of properties in addition to the residential segment (such as New Launches & Resales), they may also consider throughout shophouses which likewise might help generate passive income; that are not subject to the recent government cooling measures similar to the 16% SSD and 40% downpayment required on homes.
I cannot help but stress the importance of having ‘holding power’. You must never be made to sell your house (and create a loss) even during a downturn. Always remember that the property market moves in a cyclical pattern and really sell only during an uptrend.