Suggestions on buying property in Singapore

[mks]

We are in the process of relocating to Singapore for 3 years. Arriving in a few weeks. My wife wants to buy instead of rent, thinking that we may hold on to it and rent it out, even after we move back to New York (or where ever life takes us).

However, the property prices are highest in 10 years and I am afraid that I would be buying at the crest of the cycle. Any thoughts/observations would be appreciated.

[newtoisland]

Hi, we just moved from NY as well and were in the same thought process as you and your wife. We finally decided to rent mainly because we didn't know the areas in Singapore well enough and as you said the prices are very high now especially with the new developments. So we are waiting to see what happens in 2008.

Good Luck with your move and pls keep us updated whether you decided to buy or rent.

[phil30k]

My advice would be to wait.

There are many new developements in central areas in the pipeline that should enter the market in late 2008-2009. These typically would be smaller units.

Depending on market sentiment, early completion condo prices may be set low to sell quickly to avoid the coming glut. Or prices will fall subsequently due to the glut.

Developers may refrain from releasing units but you'd still be able to find bargains as the fall in prices will impact the prices of older developments (20yrs or more and typically larger sized units) greatly. This would probably be a better way to go.

[durain]

dont forget if you are renting, check what is your break away clause in the rental contract. if you sign for a 2 years rental contract, you might be stuck until the 2 years is up.

[tattattoo]

My advice would be to wait.

There are many new developements in central areas in the pipeline that should enter the market in late 2008-2009. These typically would be smaller units.

Depending on market sentiment, early completion condo prices may be set low to sell quickly to avoid the coming glut. Or prices will fall subsequently due to the glut.

Developers may refrain from releasing units but you'd still be able to find bargains as the fall in prices will impact the prices of older developments (20yrs or more and typically larger sized units) greatly. This would probably be a better way to go.

my advice is not to wait.

the way i'm looking in Singapore transforming into a new ERA.

With F1 and the 2 IR coming in, it will help Singapore tourist to be boost by at 1.5 times. If Singapore is not confident at the projects? why do they build Terminal 3 for? T1 and T2 are able to handle 12 millions visitors per year. T3 is for the opening for the major events which going to take places soon.

For the past weeks, new HDB flats are selling at $520psf (that the prices for condos @ last year).

If putting yourself in the shoes of the developers, will you come up with a condos with facilities and selling the apartment at the prices of last year.

Basically, buying property is just like buying shares. of course returns may not be as fast as shares.

Well if the prices come down, just hold on to the units. rent it out to someone. You still have someone paying partial for your loans. You still get returns.

My advice to ppl who thinking of purchasing a unit must have the holding power. if not better rent it.

there's my 2 cents worth.

tattattoo

[phil30k]

I value your take on the subject and I agree with a lot of what you say. I'd like to develop some points further if I may.

My concern is that the International Resorts may not have as great an impact as anticipated. I'm sure we've read in the papers about other similar developments in the region and complaints that they are "stealing" business from each other. This suggests to me that we may have reached a saturation point where the introduction of the IR here may not significantly impact property values in Singapore.

I'm also wary that a part of the current increase may already be due to an anticipation of future increases in value resulting from the IRs. Singapore is especially prone to the mindset of selling today at tomorrow's prices. That was what created the previous property bubble, due in part to the anticipation that large number of HongKongers would be moving out and into Singapore and pouring their money here.

So, buying now may mean losing money when the market re-adjusts later.

That being said, buying now may mean that you can take advantage of this speculative fever and make some profit in the meanwhile. Getting your timing right, being able to read the market and getting out before the market readjusts would be key.

I also agree with tattattoo on being sure you have holding power. Nothing messes with your investment more then having to liquidate it at a time when the market is poor, especially if that's the time you leave and have to liquidate.

So do you want to be a player or are you just looking at where to park your money?

[mks]

With rental yields not very favorable, I am not sure how much sense it makes right now for me. I will be in Singapore for the next 3 years. I am fairly positive that the market will go through an adjustment during that time. Depending on the situation, I may be able to hold the property for medium term but for that, the rental yield has to be right. That is the hesitation on my end.

[Starman]

Property prices are way high now. For prime locations, it's more than double the previous peak 10 years ago.

Usually, the axiom in buying a property is location, location, location. But with record high prices, would you dare to jump in now?

Just my 2 cts worth

[nessa]

Prices are going up in Singapore, but according to a research I found on the net, Singapore Rental Yields is quite low.
Well according to Global property Guide, rental yield in Singapore is about 2 to 3 percent. So if you think it is worth an investment, go for it.

[ProvenPracticalFlexible]

Prices are going up in Singapore, but according to a research I found on the net, Singapore Rental Yields is quite low.
Well according to Global property Guide, rental yield in Singapore is about 2 to 3 percent. So if you think it is worth an investment, go for it.

I would leave that 'quite' out, if you look on the same site a bit more: http://www.globalpropertyguide.com/investment-rating
You'll notice that out of 109 locations ranked, Singapore is 108th in rental yields. Property prices are high, rental returns low. Hmm doesn't sound like a good investment if one is planning to stay short term. On top of that F1's and IR's are already included in speculative prices. One shouldn't take the real estate agent comments on local newspapers as realistic forecasts, those are more marketing; buy now next year prices will double.

[Superglide]

It's not exactly buying a bag of popcorn, is it?

I would not invest my money in Singapore property unless I would know all the nitty gritty, the ins and outs and all more needed to make the right decisions.

Better pay a high rent for 3 years than losing hundreds of thousands of dollars, if not more.

I am afraid you have no idea what you be starting.

[ksl]

Rental yields are low in Singapore, that's probably why, many Landlords try to hang on to the deposits.

The mind set here is kind of, eat the hand, that feeds you! Rather than planting seeds to reap an harvest.

Although I am starting to believe it's a sign of the lack of ability of individuals, to look futher than their noses,
.
My question is, is there any hope, that the mindset can be changed?

Is Singapore in the progress of improving quality services?

When will we see a change in positive consumer attitudes?

The law leans towards the Landlords, with no tenant protection, can it be influenced to change for better consumer protection?

Many properties are rented out, with garbage furniture, have these landlords no sense of pride or respect?

I mean, if one is paying 4 & 5000 a month, what would you expect in a furnished property.

Personally I don't believe the prices will drop, significantly that it matters, that much, although one should not buy to sell in 3 years and hope to make money, that is a risk not worth taking, although it is easy to rent out, to find a good reliable management service is another matter.

There are certainly many wiz kids around in these agency setups, which is giving the whole property industry a bad name!

Although there are also many good ones, so what's needed is some form of creditation other than being a member of the property Association, because agents do not need a licence, they operate under the licence holder, and with freelance agents in the thousands, something is going to give, and that appears to be quality of services.

There is certainly a conflict of interest, even though independant agents can be used.

The mentality is like look out expat from the west coming, price shoots up, or is it just my imagination? It doesn't happen in the local area so much, I think it's more prone to be, in the property and tourist areas, becuase visitors, don't often start discussing, the price so much, becuase they have little to relate to.

Are the complaints so small in comparison to the amount of expat rentals, that it doesn't matter, if deposits are not returned?

Do Landlords forward deposits on to expats, if the expats have left the Country, just how big is the problem, anyone know?