Investing in real estate is regarded as one of the most “straightforward” and “lucrative” ways of investment. On paper it certainly seems that way: Unlike investors who put their money in stocks and bonds, real estate owners can choose to use leverage (also known as borrowed capital) to buy a property and in turn, make money from it to finance their purchase. It sounds great on paper, but if it were truly as easy as it seemed, there would many, many more wealthy people out there!
Property investment in Singapore can take on many forms such as flipping properties, earning rental income and REIT investment; and they each have their pros and cons. Before taking the dive, would-be property investors should consider which option is most appropriate for your unique financial and home-owning situation.
If you intend to flip properties, you need to ensure you have enough financial resources to do so. Buying a piece of real estate will not only require a hefty upfront deposit, but also possibly a lengthy mortgage loan and Additional Buyer’s Stamp Duty payments.
For those who dream of becoming landlords, you should make sure that your rental income adequately covers your mortgage payments and other costs.
Investing in REITS may seem relatively simpler and hassle-free, but as with all investments, it carries risk and the need to have a good understanding and knowledge of the market.
Ready to get started on your real estate investing journey? I would be happy to share some insights with you!
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