Is it even worth living in SG anymore as a foreigner?

[Lisafuller]

Property is still a poor investment, Wd40. Your first property will be your home, not an investment. If you are able to make some money from it, it's just a nice bonus, but certainly not a good investment.

The only property investment I would consider are REITS.

I don't think this is necessarily true, if you buy your first home and allow the value to appreciate, when you eventually sell it you can make quite a bit. I think buying a second property would be an unwise investment though.

[Lisafuller]

Property is still a poor investment, Wd40. Your first property will be your home, not an investment. If you are able to make some money from it, it's just a nice bonus, but certainly not a good investment.

The only property investment I would consider are REITS.

I totally agree with this. I for sure think, if we had purchased a house instead of invest 5 yrs back, our financial situation would be drastically different. Home ownership is definitely a dream and we will do it but when we feel more confident and ready.

Agreed, owning your home is really empowering, but everybody's timeline is different.

[smoulder]

Property is still a poor investment, Wd40. Your first property will be your home, not an investment. If you are able to make some money from it, it's just a nice bonus, but certainly not a good investment.

The only property investment I would consider are REITS.

I don't think this is necessarily true, if you buy your first home and allow the value to appreciate, when you eventually sell it you can make quite a bit. I think buying a second property would be an unwise investment though.

Not really. Your first property is your home. Sure, you can sell it and maybe make some money. However, the CAGR on most property, especially in a place like Singapore is quite low. Factor in how much overhead costs you incur plus interest on your bank loan, the profits are not very impressive compared to the stock market which is where you really should be putting your investment money into.

That said, in my opinion, you shouldn't even be talking about your home as an investment - it's purpose is for you to stay in. It's about convenience as opposed to having to worry about additional uncertainties that come with renting (you can guess what they are - X9200 pretty much already covered them). Your home's primary purpose is not to make money off. If you happen to make some money off it, then that's a bonus, but that probably shouldn't be your goal - there are many other things that are probably more important when you are picking your home.

Now, in the Singapore context, the ABSD on the second property makes additional properties unprofitable which is why "investing" directly in real estate for the average middle class person is a terrible idea.

If you really want to invest in property, then you should be looking into REITS and not trying to buy apartments.

[Wd40]

Singapore is a little different, because you have an asymmetric market here. Only certain people can buy HDB, while a large segment is forced to rent. So the rental yield is crazy. It makes a lot of sense to buy your 1st HDB as soon as possible.

[Lisafuller]

Property is still a poor investment, Wd40. Your first property will be your home, not an investment. If you are able to make some money from it, it's just a nice bonus, but certainly not a good investment.

The only property investment I would consider are REITS.

I don't think this is necessarily true, if you buy your first home and allow the value to appreciate, when you eventually sell it you can make quite a bit. I think buying a second property would be an unwise investment though.

Not really. Your first property is your home. Sure, you can sell it and maybe make some money. However, the CAGR on most property, especially in a place like Singapore is quite low. Factor in how much overhead costs you incur plus interest on your bank loan, the profits are not very impressive compared to the stock market which is where you really should be putting your investment money into.

That said, in my opinion, you shouldn't even be talking about your home as an investment - it's purpose is for you to stay in. It's about convenience as opposed to having to worry about additional uncertainties that come with renting (you can guess what they are - X9200 pretty much already covered them). Your home's primary purpose is not to make money off. If you happen to make some money off it, then that's a bonus, but that probably shouldn't be your goal - there are many other things that are probably more important when you are picking your home.

Now, in the Singapore context, the ABSD on the second property makes additional properties unprofitable which is why "investing" directly in real estate for the average middle class person is a terrible idea.

If you really want to invest in property, then you should be looking into REITS and not trying to buy apartments.

I'm by no means saying that buying a home should be the way to invest in SG, but it is still an investment. We bought our condo for around $800,000 22 years ago. The unit is now worth a little north of $2 million, based on transaction prices within the estate. When we eventually sell to move to the states, we would've made a significant profit.

[Lisafuller]

Singapore is a little different, because you have an asymmetric market here. Only certain people can buy HDB, while a large segment is forced to rent. So the rental yield is crazy. It makes a lot of sense to buy your 1st HDB as soon as possible.

Yup, and they sell for a ton now! Hearing about million dollar HDBs is no longer a surprise, though it should be if HDBs are supposed to be affordable public housing.

[the observer]

I don't think this is necessarily true, if you buy your first home and allow the value to appreciate, when you eventually sell it you can make quite a bit. I think buying a second property would be an unwise investment though.

Not really. Your first property is your home. Sure, you can sell it and maybe make some money. However, the CAGR on most property, especially in a place like Singapore is quite low. Factor in how much overhead costs you incur plus interest on your bank loan, the profits are not very impressive compared to the stock market which is where you really should be putting your investment money into.

That said, in my opinion, you shouldn't even be talking about your home as an investment - it's purpose is for you to stay in. It's about convenience as opposed to having to worry about additional uncertainties that come with renting (you can guess what they are - X9200 pretty much already covered them). Your home's primary purpose is not to make money off. If you happen to make some money off it, then that's a bonus, but that probably shouldn't be your goal - there are many other things that are probably more important when you are picking your home.

Now, in the Singapore context, the ABSD on the second property makes additional properties unprofitable which is why "investing" directly in real estate for the average middle class person is a terrible idea.

If you really want to invest in property, then you should be looking into REITS and not trying to buy apartments.

I'm by no means saying that buying a home should be the way to invest in SG, but it is still an investment. We bought our condo for around $800,000 22 years ago. The unit is now worth a little north of $2 million, based on transaction prices within the estate. When we eventually sell to move to the states, we would've made a significant profit.

It's a bit difficult to make a comparison on asset returns between unleveraged stock returns vs leveraged real estate. Afterall, most buyers of real estate take a mortgage, and assuming you downpay 25% on your property, a gain of 12.5% on your property is actually a 50% gain on your downpay, ie cash you have.
And most stock buyers are unleveraged, ie your stock investment would actually not exceed the cash you have.

The assumption is a pure stock purchaser with no home would pay rental, whilst a home buyer pays no rental, only the mortgage interest. You could argue its about the same, but empirically mortgage interest/month is less than rental. Mortgage itself minus interest can be recouped when you sell off the hse.

[NYY1]

I'm by no means saying that buying a home should be the way to invest in SG, but it is still an investment. We bought our condo for around $800,000 22 years ago. The unit is now worth a little north of $2 million, based on transaction prices within the estate. When we eventually sell to move to the states, we would've made a significant profit.

It's a bit difficult to make a comparison on asset returns between unleveraged stock returns vs leveraged real estate. Afterall, most buyers of real estate take a mortgage, and assuming you downpay 25% on your property, a gain of 12.5% on your property is actually a 50% gain on your downpay, ie cash you have.
And most stock buyers are unleveraged, ie your stock investment would actually not exceed the cash you have.

The assumption is a pure stock purchaser with no home would pay rental, whilst a home buyer pays no rental, only the mortgage interest. You could argue its about the same, but empirically mortgage interest/month is less than rental. Mortgage itself minus interest can be recouped when you sell off the hse.

The home buyer also pays maintenance fees and property taxes (in addition to mortgage interest), this will push the total closer to the amount of rent a renter pays (costs that are 100% gone). The difference is the mortgage payment is roughly fixed while the rent floats based on supply and demand (and is likely to go up over extended periods of time). The downside to owning is that you are locked in to one place that depreciates over time. Renting is paying more but often you are consuming something "new" (or more convenient if your needs change).

So the home buyer gets the leveraged return on the property equity while the renter gets the return on the investment. In the end, there's no 100% apples to apples way to compare both the strict cost/return and the utility from one or the other.

I think most people accept that over extended periods of time, property in Singapore will make some return, not a great return (the above example made about 4.5%. Note, I think some property indices will show higher returns but these figures are likely biased by the inclusion of "newer," i.e. more expensive, properties over time). There is also a wide range of returns in property here; some are decent, some are terrible.

[Wd40]

Also not everyone can make money in stocks. Just look at how horrible Singapore REITs are doing and don't even talk about China stocks. Most Singaporeans are stuffed to the gills in these 2 areas and are hurting big time. I can bet most are underperforming CPF 2.5% returns. Your 1st home should be bought in Singapore and not rented, if you plan to stay here and you are not paying ABSD of above 5%.

[Lisafuller]

I'm by no means saying that buying a home should be the way to invest in SG, but it is still an investment. We bought our condo for around $800,000 22 years ago. The unit is now worth a little north of $2 million, based on transaction prices within the estate. When we eventually sell to move to the states, we would've made a significant profit.

It's a bit difficult to make a comparison on asset returns between unleveraged stock returns vs leveraged real estate. Afterall, most buyers of real estate take a mortgage, and assuming you downpay 25% on your property, a gain of 12.5% on your property is actually a 50% gain on your downpay, ie cash you have.
And most stock buyers are unleveraged, ie your stock investment would actually not exceed the cash you have.

The assumption is a pure stock purchaser with no home would pay rental, whilst a home buyer pays no rental, only the mortgage interest. You could argue its about the same, but empirically mortgage interest/month is less than rental. Mortgage itself minus interest can be recouped when you sell off the hse.

The home buyer also pays maintenance fees and property taxes (in addition to mortgage interest), this will push the total closer to the amount of rent a renter pays (costs that are 100% gone). The difference is the mortgage payment is roughly fixed while the rent floats based on supply and demand (and is likely to go up over extended periods of time). The downside to owning is that you are locked in to one place that depreciates over time. Renting is paying more but often you are consuming something "new" (or more convenient if your needs change).

So the home buyer gets the leveraged return on the property equity while the renter gets the return on the investment. In the end, there's no 100% apples to apples way to compare both the strict cost/return and the utility from one or the other.

I think most people accept that over extended periods of time, property in Singapore will make some return, not a great return (the above example made about 4.5%. Note, I think some property indices will show higher returns but these figures are likely biased by the inclusion of "newer," i.e. more expensive, properties over time). There is also a wide range of returns in property here; some are decent, some are terrible.

Definitely, and a lot of it has to do with luck as well. Securing good interest rates, picking a house in a good location, the list goes on.

[Lisafuller]

Not really. Your first property is your home. Sure, you can sell it and maybe make some money. However, the CAGR on most property, especially in a place like Singapore is quite low. Factor in how much overhead costs you incur plus interest on your bank loan, the profits are not very impressive compared to the stock market which is where you really should be putting your investment money into.

That said, in my opinion, you shouldn't even be talking about your home as an investment - it's purpose is for you to stay in. It's about convenience as opposed to having to worry about additional uncertainties that come with renting (you can guess what they are - X9200 pretty much already covered them). Your home's primary purpose is not to make money off. If you happen to make some money off it, then that's a bonus, but that probably shouldn't be your goal - there are many other things that are probably more important when you are picking your home.

Now, in the Singapore context, the ABSD on the second property makes additional properties unprofitable which is why "investing" directly in real estate for the average middle class person is a terrible idea.

If you really want to invest in property, then you should be looking into REITS and not trying to buy apartments.

I'm by no means saying that buying a home should be the way to invest in SG, but it is still an investment. We bought our condo for around $800,000 22 years ago. The unit is now worth a little north of $2 million, based on transaction prices within the estate. When we eventually sell to move to the states, we would've made a significant profit.

It's a bit difficult to make a comparison on asset returns between unleveraged stock returns vs leveraged real estate. Afterall, most buyers of real estate take a mortgage, and assuming you downpay 25% on your property, a gain of 12.5% on your property is actually a 50% gain on your downpay, ie cash you have.
And most stock buyers are unleveraged, ie your stock investment would actually not exceed the cash you have.

The assumption is a pure stock purchaser with no home would pay rental, whilst a home buyer pays no rental, only the mortgage interest. You could argue its about the same, but empirically mortgage interest/month is less than rental. Mortgage itself minus interest can be recouped when you sell off the hse.

Mortgage interest is absolutely lower than the cost of rental, plus at the very end of the day you're left with full equity if you're home, while renters are left with nothing.

[Lisafuller]

Also not everyone can make money in stocks. Just look at how horrible Singapore REITs are doing and don't even talk about China stocks. Most Singaporeans are stuffed to the gills in these 2 areas and are hurting big time. I can bet most are underperforming CPF 2.5% returns. Your 1st home should be bought in Singapore and not rented, if you plan to stay here and you are not paying ABSD of above 5%.

Completely agree, if it is within your means, it's always smarter to buy than to rent in SG.

[Wd40]

Malaysia has really screwed up with the MM2H minimum salary requirements. The people governing the country are so pathetic, which is one of the reason why Singapore thrives.

Malaysia should ideally take advantage of the WFH crowd in Singapore and allow anyone who has a work visa in Singapore or PR/SC to live and WFH from Malaysia, in return pay some sort of tax. I think this could be a win win for both Singapore, Malaysia and also the expats who live here. This would do wonders for the Malaysian economy and kind of reduce the arbitrage that currently exists b/w Singapore and Malaysia.

[Lisafuller]

Malaysia has really screwed up with the MM2H minimum salary requirements. The people governing the country are so pathetic, which is one of the reason why Singapore thrives.

Malaysia should ideally take advantage of the WFH crowd in Singapore and allow anyone who has a work visa in Singapore or PR/SC to live and WFH from Malaysia, in return pay some sort of tax. I think this could be a win win for both Singapore, Malaysia and also the expats who live here. This would do wonders for the Malaysian economy and kind of reduce the arbitrage that currently exists b/w Singapore and Malaysia.

That's genius, WD40. I can think of so many locals who would jump at the chance.

[the observer]

Singapore rental gains partly driven by Hong Kong residents

https://www.bloomberg.com/news/articles ... g-bargains