“It is not when you buy but when you sell that makes the gap 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 for 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 great advantage by entering the property market and generating passive income from rental yields compared to putting their cash on your bottom line. Based on the current market, I would advise they will keep a lookout virtually any 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 use the same page – we prefer to make the most of the current low pace and put our make the most property assets to produce 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 to an annual passive income as much as $18 000 per annum which easily beats returns from fixed deposits plus 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 can lead to a slower rise in prices as in order to 2010.
Currently, we are able to access that although property prices are holding up, sales start to stagnate. Let me attribute this towards following 2 reasons:
1) Many owners’ unwillingness to sell at lower prices and buyers’ unwillingness to commit to some higher value tag.
2) Existing demand unaltered data exceeding supply due to owners being in no hurry to sell, consequently leading to a enhance 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 associated with property market as their assets will consistently benefit in time and increase in value due to the 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 consist of types of properties in addition to the residential segment (such as New Launches & Resales), they may also consider buying shophouses which likewise can help generate passive income; and are 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 importance of having ‘holding power’. Never be forced to sell your house (and make a loss) even during a downturn. Be aware that the property market moves in a cyclical pattern and you will need to sell only during an uptrend.