Property Investment, [ Real Estate Articles ]
How to invest in Singapore Properties
March 25, 2010 by Admin · Leave a Comment
3 simple ways to invest in Singapore real estate market – hopefully make a huge profit, cash out and take time go travel around the world =)
1st way – buy low, sell high
Very simple strategy, investing 101. Timing is key to success for this strategy. Opportunity for buying low is during recession, when sentiments in job market and economy are low (the lower the better). This is a great time to enter the market ‘coz prices will be depressed.
Some investors like to buy when prices are “relatively attractive” or “affordable” according to their means. Some investors may choose to buy in only when there’s signs of uptrend (so they are more assured they are buying at the base of the upturn).
So how do we know whether it’s the bottom?
During the bad times, many will say “it’s too risky, it will go lower, let’s wait”. Do understand that real estate is inherently an illiquid investment, as opposed to the equity market. The periodic charts / graphs / data presented (on a macro scale) will be good indicators of how the real estate market is moving, or as the stock experts put it – “trending”. The stock market chart may show volatility (up 1 day, down the other, up 1 week, down the other) but real estate market data will trend for quite some time before peaking or bottoming (we also won’t know exactly how long, that’s a question which only the market has an answer to, and there are some helpful leading indicators to show the way ahead for you – you just need to know which ones to use).
Some home buyers like to think that today’s prices are “too expensive” (they are comparing in relative to last month or last year’s price). Frankly, we will only support such thinking if the broad market data shows “all-time highs”, constant news of “record-highs”, otherwise smart buyers should understand that you are not the only one who is buying at this “higher price”. If others are buying around the same price, then it is only natural that the market forces will continue to push the prices even higher because each buyer-turned-seller will continue to ask for higher prices to gain profit, and that is how everyone plays the game (well, at least until the bubble bursts).
2nd way – buy at a discount
Simple strategy but often neglected. So, you may be curious as to where exactly can you find properties at a discount? Most real estate articles will teach you to look for foreclosures (auctions), urgent sales, etc. So, we won’t say more about those.
There’s actually another type of property which we believe can be considered as “discounted” – old apartments in worn-out condition. A word of caution – you should be somewhat interested in doing renovation works, talking to designers and handling contractors if you are interested in investing in this type of “discounted” properties. And always remember the 3 golden rules of real estate – location, location, location.
In fact, you can also find “discounted” properties in brand new uncompleted condominium projects as well. You just need to know developer’s price strategy and how to look at project site plans and floor plans =P
3rd way – buy to lease out
Rental yield (the rental returns on your property purchase) is a fundamental way many people earn money from property investments. If you are looking into this strategy, may we suggest purchasing relatively new, 99-year leasehold properties (in a great location) instead of freehold (in the middle of nowhere)?
Tenants are willing to fork out higher rental for (1) convenience, (2) comfort. Tenants will not pay you more because your property is a Freehold tenure (even if you had to pay the seller or developer more).
Tenants will pay more if your property is near a subway (MRT), or has wonderful facilities, is nicely furnished and lets them comfortably enjoy their period of stay in Singapore.
We have a list of Singapore properties near subway (MRT).
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Our company has had more than 30 years of experience dealing in public and private residential, commercial and industrial properties in Singapore. Portfolio includes international schools, major MNCs and many renowned individuals.