“It is not calling it buy but when you sell that makes the gap 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 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 great advantage by entering the property market and generating second income from rental yields regarding putting their cash in the bank. Based on the current market, I would advise that they keep a lookout for any 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 simple.7%.
In this aspect, my investors and I take prescription 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 as many as $1500 after off-setting mortgage costs. This equates for annual passive income as high as $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 can easily see that the effect of the cooling measures have lead to a slower rise in prices as in order to 2010.
Currently, we cane easily see that although property prices are holding up, sales start to stagnate. I am going to attribute this towards following 2 reasons:
1) Many owners’ unwillingness to sell at less expensive prices and buyers’ unwillingness to commit into a higher charges.
2) Existing demand for properties exceeding supply due to owners finding yourself in no hurry to sell, consequently resulting in a improve 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 your market property market as their assets will consistently benefit in time and increased 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 various other types of properties besides the residential segment (such as New Launches & Resales), they might also consider buying shophouses which likewise assist generate passive income; and are not subject to the recent government cooling measures prefer the 16% SSD and 40% downpayment required on homes.
I cannot help but stress the importance of having ‘holding power’. You shouldn’t ever be expected to sell your house (and make a loss) even during a downturn. Remember that the property market moves in a cyclical pattern and really sell only during an uptrend.