April 01, 2022
Many key issues surround us all the time with varying degrees of effects on our lives and the world around us. And many times, such occurrences are beyond our control. Key issues that affect us such as a pandemic, the Russian-Ukraine conflict and/or sanctions imposed, where much uncertainty looms over the economy and our future. Or perhaps the rising interest rates and recent property cooling measures, where the latter stems to impede the red-hot property market despite economic fallout from the pandemic.
Repercussions. If any?
From the Figure 1 below, you can easily observe that despite several rounds of cooling measures implemented, the average prices of new homes & resale homes in the private property sector continues to flourish. As you can see from 2013 after the double round of cooling measures in January and June 2013, up till July 2018, new sales average $psf grew by 20% overall, albeit volatile. And on the resale front, $psf grew by 7% .
Assuming you entered the market after the second round of ABSD in 2013 and bought a property of 1,000 sqft at $1,363 psf and kept it until the recent highs of 2021 when it is $2,248 psf, you could have the option to walk away with a staggering $900,000 profit!! The objective here is to help you take the right action, if you had the choice to buy a property for own-stay and at the same time reap big profit margins, would that be a dream come true? Don’t you think that it is close to impossible to save $900,000 in 8 years by working hard in your day job while thrifting?
Figure 1: Average transacted price (psf) of non-landed homes (new sales vs resales)
Even on the outlooks of HDB during the same period as seen in Figure 2, from its peak prices in 2013, resale prices have dipped for 24 consecutive quarters (6 years) by 12.4%. After bottoming in Q2 2019, prices have rebounded and did remarkably well in 2021 as prices grew 12.7% - exceeding peak prices in 2013. Looking at the data might then trigger one to consider if it would have been better to sell their HDB flat in 2012 or 2013 before the price slum, or simply wait another 8 years to enjoy higher returns? Could you have foreseen how long it would have taken the HDB prices to exceed its previous high? Or could you have profited even more by reinvesting those possible profits? Many homeowners continue to battle with such questions and ultimately cause their own inaction.
Figure 2: HDB resale price (%) index
Let’s take a look at Figure 3, Double Bay Residences, a 99-year leasehold condominium with an average entry price of $600psf when it first launched. Reaching its peak at 2014, prices were soaring to an average of $1,250psf, which if you were to have sold it then, would reap you a handsome profit of $650,000. Noting that prices continue to move sideways since the peak in 2014. Question is, will the price continue moving sideways or would there be any more upside for this development? The most important question should be, why did this property not ride the recent upswing like the newer developments? Could there possibly be key indicators out there you could read into so that you could enjoy the maximum gain like those highly savvy investors?
Figure 3: Double Bay Residences quarterly average price (psf)
With so many burning questions from homeowners and property buyers from all walks of life, we decided to take it upon ourselves to design a platform where you can get these questions answered. At the same time, depending on where you are in your property journey, understand and address key concerns that you would be facing or are already facing.
Our aim is to take you through three stages of your real estate journey, where our objective of this expo is to address all your concerns and provide clarity to property owners and aspiring ones about intricacies that you might not yet know about the property market so that you could make wiser decisions moving forward.
Timing may be critical but precision is everything. If times are good, you are able to make good profits on your property. But even at times when it may seem unfavourable, there are opportunities that lie within, especially during a crisis. Timing your entry and planning exit with precision is crucial as it often dictates the kind of profits you are able to generate.
Lastly, our expo over two weekends will be curated to address individuals at their different points of their property journey – to ensure that whatever is delivered would be relevant and useful to you.
Going through the different property journey stages with you, we hope to help you plan for the future. Especially the golden years when you should be enjoying the joys of what life has to offer and not worry about the inevitable rising cost of living in Singapore. Looking at the infographic from CPF below, you can see the stark difference when it comes to the usage of your CPF for different age groups. There are factors you will need to consider when making your property move as many still have the misconception that you cannot use your CPF to pay for private properties! Have you ever wondered if there is a strategy behind the utilisation of our CPF funds?
Also, another article from The Straits Times reflecting on those who are in their 60s and have regretted not having a head start or any proper planning when it comes to retirement. From the article, one netizen even quoted saying that she wished she had purchased two properties had she known she would be in this predicament of working late into her golden years to make ends meet. We can safely assume that no one wants to look back and regret not taking action when one can actually have the chance to, right?
From our inception we have always aimed to educate the public with property knowledge, helping them make good calls that will help them with financial stability, we have empowered thousands of individuals to reach their ideal retirement goals. Below is an example of one such individual, Mr Wilson Teh, who within a short span of 6 years upgraded from ONE property in Yishun to THREE condominiums & ONE brand-new landed home. How is that possible, you might ask.
People always misunderstand that property investment is for the rich and for those who have the massive capital to get in. But they fail to see that even first-time buyers who would generally buy a home for own-stay if bought and entered at a good time can result in big reaps, and create a snowballing effect in their future property journey if carefully planned. Time is of the essence here so it is critical to act fast. Do take the opportunity to assess your current property portfolio so that you can accurately map out your path ahead to safeguard the future of you and your family.
April 6, 2022