Oct 30, 2012

Posted by in Property Investment Tips

What Made Me Decide Property Investment Is the Best Wealth Creation Tool?

What Made Me Decide Property Investment Is the Best Wealth Creation Tool?

This is a question I have often encountered during my media interviews – what made decide to build my expertise and knowledge in property investment.

You can read more below……

Even though I also invest in equities, I realize that I have resonated more with property investment.  I have bought into stocks that have gone down the drain but properties will always have base value.

From my prior investment experience, I came across those who invested their money on stocks, shares, bonds, savings accounts and various other alternative investment possibilities.

Still, I encountered them to lament on their impulsive decisions because there is always a risk losing a large part of the capital investment.

Property investment value, on the other hand, will never turn to zero value as opposed to investing in stocks per se.

While there are many ways of investing & growing personal wealth, I personally found that property investment is one of the best wealth creation tools.

It was reported by Boston Consulting Group (BCG) in its Global Wealth Report 2012 that 1 in 6 households in Singapore are millionaires.  It is believed that most of these households have accumulated their networth through property gains.

I owned a landed property that has increased more than S$1 million within 2 and half years of owning it.

All other properties that I have also invested in have also recorded good gains.  So you can say I’m one of those whom have benefited tremendously. I have also seen many other average people grow their net worth through property investment.

My cousin became a millionaire even though he is an employee. He got into one investment property that has given him more than S$1 million in gains within 4 years. He was sharing that this wealth is almost impossible to come by from working strictly as an employee.

An investment is the ability to achieve returns independent of market conditions and provides you the best financial security in virtually any economic environment.

In simpler terms, investing in properties in the form of rent enable you to reap steady income, reduction in taxes, and high chances of property value to escalate without any depreciation value due to Singapore’s scarce land and limited prime residential areas.

Though the prices of properties are becoming exorbitant, there is always a constant demand for properties.

However, one has to be aware of Singapore’s cooling measures as the government is trying to curb the housing bubble. Even though housing prices are at all time high, there are still pockets of opportunities for investors to make money.

Keep an open mind to overseas market too since there are vast opportunities in some countries that are not doing too well at this point.

Bargains are always available every day in the property sector. Getting familiar of the current property market and understanding all other asset classes like the commercial and industrial property sectors can aid you in generating vast profits.

As a multicultural and vibrant nation, Singapore houses over five million ethnic people. This can enable better promotion of foreign relations.

As a global hub of pharmaceuticals, shipping and tourism, Singapore is equipped with diverse economic sectors to weather any long-term, adverse economic downfalls.

Strong bilateral ties with China aid in boosting anticipated growth of national income thus it brings propagating impact on Singapore real estate values.

Singapore’s reputation of being one of the least corrupted nations in the world, good governance and liberal free trade establishments makes it attractive for a flourishing real estate industry.

Singapore’s property investment returns continue to rise despite global economic uncertainties.

Investment sales surpassed from S$28.8bn in 2010 to S$30.8bn in 2011 and these figures are set to surge in the years 2012 and 2013.

The up-side of investing in real estates are that investors can earn both passive income and capital gains.

Also, prices over long term tends to increase due to natural inflation such as the rising cost of land, building materials, energy, manpower cost and commodities etc.

Furthermore, properties are evergreen investments. The main point is there is limited downside risk once you know what you are buying into and the potential of up-side risks are just a matter of time.

Currently, Singapore’s demand for housing in non-prime locations is still strong and  together resale home prices continue to climb according to a private sector property report.

More investors are also putting their funds into commercial and industrial properties thereby driving the prices higher and higher as well.

In conclusion, baring some downturn in the property cycle, property investment in Singapore continue to be viable if investors have a longer term outlook.

As long as one is not over leverage, I believe it is possible for investors to continue to see gains in longer term.

Singapore as a rare AAA rated country will continue to attract huge flushes of private and institutional funds that are looking for safe haven to invest it.

We should feel very grateful that our government has done a great job to make Singapore an investment haven!

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  1. thanks for this helpful article, interesting and rich for the investors

  2. Everyone has their niche, for you it might be property investment, mine could be writing and zakaria might be a famous poet but to say property investing is “the best wealth creation tool” I think is very a narrow statement. The writing is excellent and the information is helpful, thank you for producing creative helpful content.

  3. It is well known that Singapore is a place of real estate investment. Many researching companies around the world prove this truth, as you have said one of six households is a millionaire. Although the world has been passing the worst financial condition, but Singapore is still strong with the business of real estate where this sector of the USA has already been collapsed by the financial turmoil.

  4. If property investment in Singapore now is performing well, then that must be the trend concerning property market now. If that is so, then it is also a good decision to invest in the property sector at present which means one can try allocating a higher percentage on this in one’s portfolio at this time relatively depending on its performance since after all one’s portfolio can be diversified and rebalanced from time to time.

  5. Adnan S. Jatt says:

    Property investment is indeed a wealth creating tool, but only with the right circumstances. Like, enough customers and the demand of that property in the market, proper timing, proper location, stock exchange conditions. Well, it the economy falls down, it returns us our base value when we sell it because land always bears the brunt of the economic downfalls. Regarding the statement, that it is the best wealth creation tool, similar we can say about the gold and other investment sectors.

  6. What an article. It describes a lot; I do not think I need to discuss anything at all after reading the whole article. The writer Wendy Kwek Is extremely a good writer who of course deserves thanks and appreciation. This article is very very well written and very much informative as well. I think and believe that the investor should read this article before investing on the property. I hope such kinds of more articles would be seen very soon.

  7. That’s interesting that you made most of your wealth through property investment over equities. It’s a good lesson for people looking to accumulate wealth. Property investment can be intimidating, finding the right developers and all of the legal hoops you have to jump through. But it looks like it pays well in the end.

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