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  • Writer's pictureAaron Lin

Singapore Property Investment is BAD?

Summary

Property investment involves a higher quantum than other asset classes.


Property investing is more tangible than other asset classes. This means that the factors affecting property prices are more transparent and you can exercise more control over the asset.


The greatest challenge in property investing is finding the need and want for it.

Article

Property investment is not a need. Even though some have the money to make property investments, they feel that there is simply no need to make the investment and they are not willing to take the risk.


You have to first ask yourself if you are ready to make money out of property investment. While the outlay of other investments is limited to a couple of thousands or hundreds, property investments require a huge sum of money in excess of S$300,000. If it is a resale property, they will have to pay the full instalment immediately and find a tenant. Ultimately, the quantum for property investment is larger. The greatest challenge in property investing is convincing yourself that you have the need and want for property investing. This means a fundamental change in mindset that shifts from work income to passive income.


Many will make comparisons with other asset classes like REITS, Forex and equities. But property is different because it is tangible since you have control over the property and can freely make rental decisions. In fact, you are protected against risks like climate change since natural disasters will not strike the building. In some sense, property investing is much safer in Singapore than in other countries.


If you believe in facts and figures, you will realise that predicting the prices of shares is challenging since the stock’s performance does not necessarily correlate with the country’s economic performance. On the other hand, property prices are definitely linked to inflation and economic growth. Factors influencing property prices are much more transparent than those affecting share prices.


Every person will have different investing preferences, given their financial background and risk appetite. There are pros and cons associated with each investment class. Personally, I feel that property investing in Singapore is safer and more secure.





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