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Is a studio apartment worth investing?

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abbychoo
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Is a studio apartment worth investing?

Postby abbychoo » Wed, 21 Jan 2009 10:55 pm

Can anyone tell me if a studio apartment is worth purchasing at this time?
What is the potential rental market for studio apartments and is it difficult to sell studio apartments during good times?

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durain
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Postby durain » Wed, 21 Jan 2009 11:12 pm

best investment since slice bread. go for it. but as with any investments, the risk is with you.

(i said the same 6 months ago about lehman brothers investment that they are the best investment since slice bread)

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AngryAngMo
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Postby AngryAngMo » Thu, 22 Jan 2009 9:47 am

Ah, actually a good question, I am living in a studio apartment myself and i was thinking about buying the place a couple of time s already.

I personally believe that Studio apartments are a perfect place to stay for the single expat (although i even have a three headed local family staying next to me, I am still wondering how they manage to do that)

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sundaymorningstaple
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Postby sundaymorningstaple » Wed, 28 Jan 2009 12:59 pm

To me, that make more sense. The studio is limited in it's appeal and who can use it. Whereas as 2BR makes sense as it gives the single person some spare space or a 2nd bedroom when mom & dad arrives or a flop house for all your Uni Kaki's when they find out your are here they can come to Singapore on the cheap! And, when times get a little harder, you can always rent out the other BR to offset some of the mortgage payments.

recessionangel
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Postby recessionangel » Sat, 31 Jan 2009 5:02 pm

avoid invest in property now as we are expecting price to drop further... good luck

LaBellaVita78
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Postby LaBellaVita78 » Sat, 31 Jan 2009 10:02 pm

Hi

i am very interested in buying a unit too, especially in the East side, is 'angry AngMoh' still living in the East? Is it possible to share some info on your apartment please?

Thanks!

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Wind In My Hair
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Postby Wind In My Hair » Sat, 31 Jan 2009 11:40 pm

sundaymorningstaple wrote:The studio is limited in it's appeal and who can use it.

The studio's appeal:

- limited supply making it a scarce good

- high rental yield (around 5% compared to 3-4% for bigger units)

- potential market includes locals as well (used to living in just one room but don't want to live under parents' roof anymore)

- relatively recession proof because of lower price (the only recent launch since the downturn to be snapped up were the new studios at Newton.)

- the chance to be in a central location on a limited budget


The downsides:

- price per square foot is ridiculously high

- capital gains are limited because of the high psf price and small area

- unattractive option (if you have a family) for you to move in yourself in future if you need to


As with any other decision, whether to buy a studio depends on what you want from an investment. Studios make sense from the perspective of location and yield, and are poor choices for capital gains. Really depends on what you want.

awesomearpit
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Postby awesomearpit » Sun, 01 Feb 2009 4:22 am

well, whether a studio is appaling or not depends upon your target market and the competition. These are determined by te price and location.
If you can offer a studio , reasonably close to the city at below $1500, it then becomes very attractive because it's competing against master bedrooms in condos and hdbs.
further everyone from single expats to students (two students sharing) to locals moving out are covered in your potential market.

OTOH is the rent is closer to $2000 or above, then your market shrinks rapidly to only well paid expats and you're competing against larger HDBs and cheap apartments (farther form the city).

there are just my $0.02 as someone looking to rent a studio...


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