[caption id="attachment_3140" align="alignright" width="150" caption="Photo by «Gaurav»"][/caption]
I watched the Channel 8 news recently and saw an old lady being interviewed after happily getting her unit after balloting for the new condo. She proudly said "My retirement depends on it. I need to use the rental to fund my retirement." In my mind, I was thinking very hard if this is the correct way to plan for retirement?
Today, URA website showed developers sold 2,767 private homes in July, smashing the previous monthly record of 1,825 units that was set in June. Make me wonder if we are still in recession. Is it a bubble coming or is it an opportunity? Only time will tell.
A lot of people had talked about property investment and I like to share my 2 cents worth of thoughts. I'll like to analyse why Singaporeans like property so much?
1. They view property as Resources
Not only they feel that its a resource, to them, its a limited resource. You missed it? Thats it!!! You lose it a great chance to own that resource that they anticipate will surely rise in value. To them, Singapore have limited land and population will keep increasing with the influx of foreign talents. Demand will always exceed Supply.
They probably didn't notice that the houses built are getting taller as well...
2. They only look at the positive side of Leverage
* Leverage is a double edged sword. Imagine that you borrowed $400,000 for a $500,000 property. You only pay $100,000 upfront. If the property value increased by $50,000 and you sell at $550,000. You would have made 50% from your $100,000 that you put in. Sounds good. Isn't it?
* What if the property value drop to $450,000? Maybe they din think of that. Read more...