Real Estate in Singapore
The Republic of Singapore is located off the Malaysian coast, is among the world’s’ busiest commercial centres in the Asian region. Talking of the real estate market of Singapore, one notices several advantages that it provides to its investors and these are as follows:
• Investor Friendly Scenario: As per the Index of Economic Freedom of 2013, Singapore ranks second among the world’s freest economies. As per the Corruption Perception Index, the Asian island nation is among the least corrupted countries of the world. Furthermore, Singapore is the 14th largest exporter as well as 15th largest importer of the world. All the aforementioned statistics are a proof that Singapore is an investor friendly country. Apart from this, the island nation is backed by a robust government coupled with a mature political system, which directly translates into the country being prone to low political risks of any kind.
• Financing for Foreigners: When it comes to foreign investors, Singapore provides easy access to finance to the foreigners for buying properties. The financial institutes offer approximately 80% when it comes to mortgage financing to foreign investors. But, it is vital to note that the terms and conditions of the aforementioned mortgage financing vary depending upon lender to lender. Repayment term of such loans generally range between 25 and 35 years. Additionally, the interest rates in Singapore are also very low apart from the fact that foreign investors need not worry about any sort of capital gain taxes.
• Minimum Transaction Costs and Lucrative Rental Yields: It is a widely known fact that the rental yields in Singapore are attractive. As per the statistics published by singaporepropertycycle.com, between the period from 2008 and 2013, the rental yields ranged from 4.08 to 7.38. But the return on investment depends on varied factors which includes the location of the newly launched property. Furthermore, the real estate investor need to take into account the costs of maintenance, solicitor’s fees, taxes and stamp fees as and when charged. Thus, it is advisable to get in touch with a real estate agent to know the costs that are o be included in the property valuation. Generally, an investor is expected to pay three percent of the property’s price as stamp duty and legal fees along with two percent to the agent as commission. When compared to other countries in Asia, the transaction costs in Singapore are bare minimum. For example, the transaction costs in Indonesia are somewhere around 26.37 percent of the cost of the property, as per reports.
• Secure Retirement: As we all know, properties increase in value over the years and one can easily use this to one’s advantage by acquiring loans to buy additional properties. An alternative option can also be the sale of property and investing the money in some effective retirement plan. The key is to kick starting the investing procedure early which would reward in the building of a comfortable retirement nest which would take care of everything post one’s retirement.