Diversification in Property portfolios

Is it possible for someone in their early 30s to own a penthouse, office space and a landed house? It is not impossible. A health property investment portfolio would ideally consist of both residential and commercial properties, with rentals covering mortgages.

Building a well-rounded investment portfolio

For the average investor, aside from fixed deposits, insurance and businesses, properties are essential to building a solid portfolio. Experienced investors advice for the beginners are to always keep a lookout for good values. The other important tip: Good properties will not wait for you. To keep a good investment portfolio going, investors need to have sufficient funds to be able to pick off undervalued properties and good deals. Financial areas to look out for are loan limits, additional costs such as levies and stamp duties, Central Provident Funds and cash liquidity for down payments.

New condominiums will likely cost more in future

The recent hash of collective sales could also be indicative of the property market 5 to 10 years down the road. New condominiums built on these recently-sold land parcels would cost $250,000 to $350,000 more than existing units in the vicinity. With property prices already lower than 5 years ago, more buyers are upgrading or entering the private property market. This also means that when the new condominiums are launched or ready for occupation, sale prices could be significantly higher. Rents may follow suit, though it would depend on the competitiveness of the market then.

Buying undervalued properties at the right time could also serve investors well. Rents can be effectively channeled into mortgages to help pay off the purchase. Activity in the office-space sector has been picking up. For investors with a keen sense of the government’s master plans for Singapore, things could go very well.

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