Studio units

[abbby]

If a resale studio unit size about 390 sq ft and rent is about $1,800-$2,000 in the suburb.
Is it worth the buy at about $550,000?
My concern is the small size (sq ft) which means small potential for capital appreciation is quite little.

[Lisafuller]

Which area?

[Rocketboy]

Quite often I contemplate about the same question as above. No-one I know invests in this kind of condos, there is zero appreciation, same units in Geylang are for sale at a same price for the past 5 - 6 years. ETF would give you x3 on annual returns. But people do buy those anyway, I wonder why

[abbby]

Rocketboy: So true...
I think have to avoid Geylang location as there's a lot of uncertainty and banks may not give out loans on houses located on certain Lorongs.

I saw some in Sengkang area...rents are about $1.7-2k...sale prices about $500k...because the sq ft is so tiny, I am not sure how much one can profit from it...example if it goes up by $100 psf and house is 400 sq ft the profit is only $40,000..

[Lisafuller]

Rocketboy: So true...
I think have to avoid Geylang location as there's a lot of uncertainty and banks may not give out loans on houses located on certain Lorongs.

I saw some in Sengkang area...rents are about $1.7-2k...sale prices about $500k...because the sq ft is so tiny, I am not sure how much one can profit from it...example if it goes up by $100 psf and house is 400 sq ft the profit is only $40,000..

For such a small profit I’m not sure it would be worth all the time and trouble…

[smoulder]

I'd just buy ETFs or REITS

[Rocketboy]

Rocketboy: So true...
I think have to avoid Geylang location as there's a lot of uncertainty and banks may not give out loans on houses located on certain Lorongs.

I saw some in Sengkang area...rents are about $1.7-2k...sale prices about $500k...because the sq ft is so tiny, I am not sure how much one can profit from it...example if it goes up by $100 psf and house is 400 sq ft the profit is only $40,000..

I think Geylang at least has hopium around its potential in the next ten years, its all freehold and lowrise, may get enbloc may get gentrified, Sengkang not sure, but in my calculations the stamp duty for residential (unless you are buying as local as your first property) makes it far less attractive than a non GST registered commercial space ( In case you feel you don't want to touch other forms of investments). I do have a friend who bought a studio to rent out but his is very central location with a cost above 750k, he is betting to get higher rental due to location and better appreciation because its super central.

[Lisafuller]

I'd just buy ETFs or REITS

Same here. The real estate market is just not worth the trouble for me right now, stocks and ETFs are where its at for me.