"Buy properties with little cash? It's too good to be true." - Straits Times (8 Nov 2020)

[Throttle2]

13 minutes ago, Showster said:

Actually a lot of 50k per month owners can’t be bothered to do this.

They earn so much why will be bothered to nett gain 20K to 50K a year? Rental income already overtax them.

Entry level private is really a game structured for those 10-20K a month households. Below that a bit risky. That is the nice level that do not kenna too much tax.

No tenants? I have not seen that situation for 10 years. Even Covid-19 only strengthens rental demand.

Like that still cannot convince one to buy a property to be paid off in 30-35 years for 90+ years’ use, nothing will.

In that case, hold cash or choose your own investments bah. But do remember to benchmark 11.11, 2020. Come back 5 years later and see what you gained / missed.

 

Ahhhhhhh, now you know why i cant be bothered liao.....

finally....finally you understand liao.

good good

[Beregond]

54 minutes ago, Showster said:

Actually a lot of 50k per month owners can’t be bothered to do this.

 

In that case, hold cash or choose your own investments bah. But do remember to benchmark 11.11, 2020. Come back 5 years later and see what you gained / lost. 

 

actually i guess  now is a g0od time for private property , why i say so . cos of cov19 travel restriction, alot of pt/fw esp malaysian that travel to and fro  are struck in sg long term, they need a place to live in sg perm , at least until sg-my open 100% and virus fix. i suspect the demand will be there for 2 years. ( i dun know much about resident property )

but is it ok to jump in now, cos of this surge? i dun know.

 who know after 2-3 years, demand and market how.??

most important do u have a war chest  for this extra property if demand drop. or worst, your income drop due to job lost babababa.  

Edited November 11, 2020 by Beregond

[Jellandross]

5 hours ago, noobcarbuyer said:

I checked out I Quadrant facebook page and it appears that there has been a statement released regarding the Straits Times article. 

And from the facebook page, apparently I Quadrant has it's own cafe now? All rather confusing. 

I want to know what is iquadrant but why google show me half balls ah?

[Showster]

1 hour ago, Beregond said:

actually i guess  now is a g0od time for private property , why i say so . cos of cov19 travel restriction, alot of pt/fw esp malaysian that travel to and fro  are struck in sg long term, they need a place to live in sg perm , at least until sg-my open 100% and virus fix. i suspect the demand will be there for 2 years. ( i dun know much about resident property )

but is it ok to jump in now, cos of this surge? i dun know.

 who know after 2-3 years, demand and market how.??

most important do u have a war chest  for this extra property if demand drop. or worst, your income drop due to job lost babababa.  

2-3 years to get rid of Covid.

After that massive open up. What you think?

[Wt_know]

sounds good to be true? yes, it is true ... little money down = 90% loan, no money down = 120% loan ... huat ah!

a $488K unit can rent out for $3,450 per month meh? = 8.48% gross yield?

where to purchase a $488K unit in 2017, good location and good size to rent out at $3,450, is this even possible?  

 

Edited November 11, 2020 by Wt_know

[Showster]

1 hour ago, Wt_know said:

sounds good to be true? yes, it is true ... little money down = 90% loan, no money down = 120% loan ... huat ah!

a $488K unit can rent out for $3,450 per month meh? = 8.48% gross yield?

where to purchase a $488K unit in 2017, good location and good size to rent out at $3,450, is this even possible?  

 

Commercial / factory may be possible.

Another possibility is reverse rent. Current HDB (in 2017) rented out while one goes to live somewhere else. Buy, live with parents, etc etc. Live in Malaysia etc etc.

Edited November 11, 2020 by Showster

[noobcarbuyer]

2 hours ago, Wt_know said:

sounds good to be true? yes, it is true ... little money down = 90% loan, no money down = 120% loan ... huat ah!

a $488K unit can rent out for $3,450 per month meh? = 8.48% gross yield?

where to purchase a $488K unit in 2017, good location and good size to rent out at $3,450, is this even possible?  

 

 

I think it's a bit hard to get 90% loan for commercial properties now, with MAS asking banks to tighten the lending criteria for newly set up companies or shell companies. 

This will have repercussions on our business friendly reputation. 

 

Quote

 

https://www.singaporelawwatch.sg/Headlines/Scare-tactics-to-lure-property-investors-come-under-fire

Scare tactics to lure property investors come under fire

Source: Straits Times
Article Date: 08 Nov 2020
Author: Tan Ooi Boon

One such scheme entails using shell companies to apply for bigger loans to buy commercial properties.

The Singapore authorities have criticised the "irresponsible" actions of some property investment educators and real estate agents who use scare tactics to attract customers to their investment courses.

In particular, these people have been flagged for actively pushing the message that "HDB flats will become worthless after 99 years" on social media, so that worried owners will pay thousands of dollars to sign up for their investment courses or sell their Housing Board flats to invest in private or commercial properties.

For instance, in a recent marketing video that has been uploaded on YouTube, one such "education company" interviewed Singaporeans, asking whether they knew that the value of their HDB flats would depreciate over the years .

In another video, after interviewing several workers who said they had to work long hours, the presenter asked whether Singaporeans really "had to work till they drop" just to make ends meet.

These advertisers then exhort viewers to sign up for their "free webinars", which promote their property investment strategies as the solution to viewers' woes.

One such scheme entails using shell companies to apply for bigger loans to buy commercial properties - a scheme that is prescribed to those who may not be able to invest otherwise.

In a joint statement to The Sunday Times, spokesmen for the Ministry of National Development and the Monetary Authority of Singapore (MAS) said: "It is inappropriate for any company to play up fears and uncertainties to attract people to sign up for its property investment courses.

"This is an irresponsible marketing tactic. Buying of properties should not be seen as a quick or easy way to get rich."

While no regulatory action is being taken now, the MAS has reminded banks to step up their due diligence on commercial property loan applications.

Separately, the Council for Estate Agencies (CEA) has issued a warning to real estate agents that they must not use "inaccurate, false and misleading claims" to pressure owners to sell their HDB flats, just so they can earn more commission.

This caution came after a recent spike in HDB resale transactions, which rose by 127.3 per cent in the third quarter of this year.

The CEA urged the public to report such rogue agents so that it can take action against those who do not act professionally.

The authorities' response came about a month after The Sunday Times' Invest flagged the worrying trend of some companies holding paid courses that purportedly teach people how to invest in properties to enjoy good rental incomes while they wait for "massive capital appreciation".

These companies also claim to have investment strategies for those who have little or even no cash. To prove such claims, some past participants were shown to be able to buy properties within days of attending such "property mastery" courses.

Other success stories touted included people who were able to own multiple properties jointly in a short time.

The participants are apparently taught how to set up private limited companies to buy commercial properties, so that they can get large loans from banks.

On co-ownership of properties, the MAS spokesman said investors need to be aware of the financial risks.

"Although they may only be part-owners, if a property loan is taken out, they can be liable for the full property loan amount in the event that other investors default or if there is insufficient rental income generated to repay the property loan," the spokesman noted.

The MAS added that while investors can set up companies to buy commercial properties, it reminded banks to perform due diligence to determine if a company is engaging in substantive commercial activities or is merely a shell entity set up for the purchase of properties.

In the latter case, MAS rules require banks to apply the total debt servicing ratio rules, which will usually result in lower loan amounts.

The MAS also reminded banks to calibrate the loan-to-value limits for commercial property loans based on property usage.

Loan amounts should be lower if the commercial property is to be leased out for rental income, compared with the case where a company buys it for its own use.

Companies with genuine operations normally can get loans of up to 90 per cent of a commercial property's purchase price.

A veteran financial adviser, who routinely handles such deals and declined to be named, said most experienced property investors know that banks are usually reluctant to lend more to those who intend to buy commercial properties with the sole purpose of collecting rents.

"As a rule, I always advise them to have cash to pay 30 per cent of the property price.

"But after this reminder from MAS, I would not be surprised if banks now ask for more down payment, especially if the purchase is made through newly set-up companies," he added.

IRRESPONSIBLE TACTIC

It is inappropriate for any company to play up fears and uncertainties to attract people to sign up for its property investment courses. This is an irresponsible marketing tactic. Buying of properties should not be seen as a quick or easy way to get rich.

JOINT STATEMENT BY THE MINISTRY OF NATIONAL DEVELOPMENT AND THE MONETARY AUTHORITY OF SINGAPORE

 

 

Edited November 11, 2020 by noobcarbuyer

[Mkl22]

2 hours ago, Wt_know said:

sounds good to be true? yes, it is true ... little money down = 90% loan, no money down = 120% loan ... huat ah!

a $488K unit can rent out for $3,450 per month meh? = 8.48% gross yield?

where to purchase a $488K unit in 2017, good location and good size to rent out at $3,450, is this even possible?  

 

my layman simplistic understand is that if it is so easy, why does the bank bother to lend you to money to make this puny interest. Banks ownself hoot many properties is better profits.🤪

Edited November 11, 2020 by Mkl22

[Wt_know]

anyway, as said before ... the sun, moon and star must all align for the formula to work

all that for $1.5K positive cashflow per month with all the associated risks  ... and legwork

 

copy&paste from hwz

Edited November 11, 2020 by Wt_know

[Showster]

7 hours ago, Mkl22 said:

my layman simplistic understand is that if it is so easy, why does the bank bother to lend you to money to make this puny interest. Banks ownself hoot many properties is better profits.🤪

Property rental needs individual attention for every property. They will have to pay a team to handle it, plus all the nitty gritty.

Its cheaper to pass you the money in a mortgage. In some ways, the banks co share the profits. They take the interest. You do the running and tying of loose ends. You get the property as a fully passive income after completion of mortgage servicing.

Edited November 11, 2020 by Showster

[Wt_know]

5 minutes ago, Showster said:

Property rental needs individual attention for every property. They will have to pay a team to handle it, plus all the nitty gritty.

Its cheaper to pass you the money in a mortgage. In some ways, the banks co share the profits. They take the interest. You do the running and tying of loose ends. You get the property as a fully passive income after completion of mortgage servicing.

yes, bank only interest in money make money ... let other do the hard and long work and risk

else bank simply bid land and develop property ... why lend money to developer to make money ... lol

Edited November 11, 2020 by Wt_know

[Showster]

15 hours ago, Throttle2 said:

 

Ahhhhhhh, now you know why i cant be bothered liao.....

finally....finally you understand liao.

good good

Yup thanks for verifying. 

Landlording is a kind of work. Passive but not totally passive.

It's too much work for too little reward for the really rich.

But for those who are serious about preparing for long term retirement with an average income in SG, it is one great way. It only gets better because those who have weak financials or spending habits, or not serious, will not come and compete with you. I explained probably a hundred times and those who were acidic ten years ago are still acidic today.

Those who get it will have acted. Those who read it today, it is a starting point.

[Spidey10]

16 hours ago, Wt_know said:

oops ... that's your POOR dad saying ... go look for RICH dad advice ... hahaha

no wonder ler, poor me...

[Spidey10]

2 hours ago, Wt_know said:

anyway, as said before ... the sun, moon and star must all align for the formula to work

all that for $1.5K positive cashflow per month with all the associated risks  ... and legwork

 

 

 

not forgetting to align with your time and date of birth...

[noobcarbuyer]

13 hours ago, Wt_know said:

sounds good to be true? yes, it is true ... little money down = 90% loan, no money down = 120% loan ... huat ah!

a $488K unit can rent out for $3,450 per month meh? = 8.48% gross yield?

where to purchase a $488K unit in 2017, good location and good size to rent out at $3,450, is this even possible?  

 

After reading further, it appears that this I Quadrant modus operandi is to set up a new company to buy an industrial property with 90% loan and subdivide it and rent out to seperate tenants. Somewhat like a serviced office setup. 

Is this even allowed under URA industrial space usage guidelines?

With 100% tenancy and 0% capital appreciation, there is a monthly cash flow of $1464 to be split between 2 people. 

Correct me if I am not wrong but even medical suites at private medical centres would never get 100% tenancy! 

And where's the costings for corporate tax, property tax, agent comission, legal fees, early loan redemption fees, maintainence, renovation, wear and tear etc?

Somemore those industrial property have only 30 year lease if I am not wrong. So even a 0% capital appreciation is quite optimistic. Don't even know if it can hold it's value within those 4 years.

So this is with 50% tenancy. Which is more realistic. 

Sometimes, I have to visit those medical labs at industrial areas and it's surprising how many units are left empty and not tenanted out.

Anyway, with 50% tenancy, it gives a return of $665 a month.

All this before deducting of corporate tax, property tax, agent comission, legal fees, early loan redemption fees, maintainence, renovation, wear and tear. Add in the uncertainty of how much you can sell it for after the 4 years and I think it would be a negative return.

[Wt_know]

6 minutes ago, noobcarbuyer said:

After reading further, it appears that this I Quadrant modus operandi is to set up a new company to buy an industrial property with 90% loan and subdivide it and rent out to seperate tenants. Somewhat like a serviced office setup. 

Is this even allowed under URA industrial space usage guidelines?

So this is with 50% tenancy. Which is more realistic. 

Sometimes, I have to visit those medical labs at industrial areas and it's surprising how many units are left empty and not tenanted out.

Anyway, with 50% tenancy, it gives a return of $665 a month.

All this before deducting of corporate tax, property tax, agent comission, legal fees, early loan redemption fees, maintainence, renovation, wear and tear. Add in the uncertainty of how much you can sell it for after the 4 years and I think it would be a negative return.

sold liao for $580K wor ... huat until siao!

.

.

anyway, they are trying too hard to smoke everyone la ...

last time got people tell me buy myanmar jade also can make 500% ROI ... and it's "true" .... double quotation .... someone did made 500% ROI ... 

Edited November 12, 2020 by Wt_know

[Dp26]

18 hours ago, Showster said:

 

In that case, hold cash or choose your own investments bah. But do remember to benchmark 11.11, 2020. Come back 5 years later and see what you gained / lost. 

Make your own decisions, steer your own ship, and gain / loss is yours. For me, it’s just boring chit chat.
 

Sounds like a game plan. 
 

why not chose a transacted property u feel is good buy month to date? (No need u buy, other people buy also can) 

 

then easier to benchmark? 😉

[Enye]

if it were a few hundred years ago, germaine would be selling tulips in holland

😬