5 Principles to be followed for real estate investment
For real estate investment, there are many factors to be weighed. But among all, 5 principles are more important in local market of Singapore. Treasure at Tampines, the biggest condominiums in the regional centre of the east in Singapore, would like to share with you these 5 principles.
Principle 1: The future growth area gives the highest return
The Singapore Urban Development Authority (URA) will publish future master plans in every five-year. Smart investors are able to find clues of investment opportunities. For example, the government highlighted in the 2008 plan is Development of the Marina Bay Financial Center in the city center and the satellite financial circle by the Kallang River. Buyers who invested in property in the area at that time earned good profits.
Principle 2: The best investment projects are the projects that property investors are most passionate about
Famous and branded projects are not necessarily the most suitable ones for investment. Local investors had done most of researches on local property. Their market sense is sharp and unimaginable. Many foreign buyers are not familiar with the local Singapore market. Hence they may contact unethical real estate agent and bought a property which is deemed unpopular for locals. Remember that successful property investors will only invest on high-quality projects with growth potential. Such projects have withstood the market testing. When the market sentiment is good, many buyers can buy a house directly by just looking at the floor plan and orientation. Such units are easy to resell. The most reliable investment decision comes from the assistance of an excellent professional real estate agent and your own analysis. Wise decisions are made based on facts and actual data.
Principle 3: Property must have unique selling points
Scarce goods are always valuable in the world. Properties with unique selling points have always been able to sell for a good price, such as sea view, coastal view, lake view, city nightscapes, the largest parks, the largest malls, and the largest XX. Looking for the uniqueness of a property and investing in it, it is highly possible to obtain a good return on investment. Humans inherently remember things that are unique, rather than remembering things that are common. Potential buyers are willing to pay higher price for uniqueness. The same theory applies to property investment. E.g., for units in different directions in the same apartment, you must choose a unique landscape or a unique unit.
Principle 4: Make good use of bank leverage
Singapore has a well-developed financial system and financial services. In recent years, bank loan interest has averaged only at 2%, which is far lower than rest of countries. Moreover, banks can give foreigners up to 70% of bank loans, which greatly facilitates foreigners’ investment. Smart investors will use bank leverage. In fact, wealthy people borrow money from banks to make more money, but banks borrow money from the rest. Smart investors will make good use of bank leverage to help cash flow and use the rental to pay off the mortgage.
Principle 5: Choose the best property agent
Good real estate agents are the most professional brokers. Smart investors should choose the most professional and experienced brokers in the local market. Your decision of real estate agent should be based on their ages in the property industry, past awards, knowledge on the specific property, the area, and the growth plan for the area.
This update is shared by Treasure at Tampines, which is a en-bloc project from Tampines court by Sim Lian.