The basic characteristics of real estate include the following: it takes a long time and cost of materials, land and labour continues to increase. There is also debt or leverage because you need to loan money to pay the house, which is known as leverage, you can expect high returns in the long run if it’s properly done. Promising and great yields awaits you if you have invested on a good property. Below is a guide that you can use regarding the real estate in Singapore.
- It is best to start early so that the time horizon for the investment will be longer. Having a longer loan means lower monthly instalment. Young ones usually have lesser obligations and commitments. The factors that should be considered here is the ability to buy a house, the willingness of a bank to grant the loan; and your mind-set, holding on to the long term view of the property.
- Saving enough for your dream home doesn’t really happen. Aim at getting in the real estate arena no matter what. Once you are able to buy a house, the property constantly moves along with the ups and downs of the market. Be sure that you are capable of holding out during the downs of the market and the soaring of the interest rates. It is good to invest early not having to wait for the time that you have actually saved enough money for your dream house.
- Make a plan in advance and know your priorities. Remember, your lifestyle can tell how rich you can actually be. You can choose what you want for your lifestyle, but if you can control the urge to buy unnecessary things, spend on luxury and partying, you can save a lot of money more than what you have expected. Age is only a number, there is always time to have fun and can always be done in some other time. You will definitely succeed if you have self-control.
A guide on how to get your investment right:
- A down payment of 20% -30% is what you need to pay. Also check if the rental can cover the repayments on your monthly mortgage.
- It is best to acquire a property that is enough for your family’s needs and then buy a second property that can generate income to assist you with your monthly obligations. It is better to own 2 small properties rather than owning a large one.
- You need to make sure you can meet the monthly repayments, and you can do this if you will wisely use leverage.
- See to it that the property’s rent is able to pay mortgage by observing the rental yields.
- Residential properties are mostly preferred by investors since it is less volatile compared to a commercial property that has a higher yield in its rental, but the rental and prices fluctuate a lot because of economic changes.
Keep this guide in mind, especially if you would like to get into the real estate scene anytime soon.