"It is not when you buy but when you sell that makes the difference 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 with the 4-year Seller's Stamp Duty (SSD) that they will want 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 residual income from rental yields rather than putting their cash staying with you. Based on the current market, I would advise that they keep a lookout any kind of 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 5.7%.
In this aspect, my investors and I are on the same page - we prefer to reap the benefits of the current low interest rate 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 many as $1500 after off-setting mortgage costs. This equates with regard to an annual passive income of up to $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 go up despite the economic uncertainty, we notice that the effect of the cooling measures have result in a slower rise in prices as in comparison to 2010.
Currently, we can see that although property prices are holding up, sales are starting to stagnate. Let me attribute this towards following 2 reasons:
1) Many owners' unwillingness to sell at affordable prices and buyers' unwillingness to commit to some higher price.
2) Existing demand for properties exceeding supply due to owners being 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. They should not be excessively alarmed by a slowdown your market property market as their assets will consistently benefit in time and trend of 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), jade scape they likewise consider throughout shophouses which likewise can help generate passive income; are usually 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 ever be required to sell household (and create a loss) even during a downturn. Remember that the property market moves in a cyclical pattern and it's sell only during an uptrend.