CNY Property Tip #5
Mid last week, my laptop just died on me while some of you are still celebrating CNY. I couldn't reboot it. I tried many recommended methods in Google to restore it but to no avail. Of course, I did minister healing and resurrection to my laptop...
Finally, I went to a PC repair shop and they wanted to charge me at a relatively high price, saying that my hard drive was in a bad condition and thus, they needed to do data recovery. Thank God my friend came to my rescue (from Jurong) and tested my hard drive. All data could be copied out because my hard drive was still working. Another friend helped me to prepare and download re-installation media for OS. In a nutshell, my laptop is functioning again and it is faster than before as I bought a cheap SSD drive!
Through this process, I have grown a little smarter in IT hardware and software. I realised that if I have been equipped with the know-hows earlier, I would not have spent a few days encountering 'hard-knocks' with no result. And this is just a laptop...
Can you imagine if you are not being equipped with the know-hows about property? Now we are talking about 6-7 figures in terms of money involved!!!
Buying a property in a hot area does not necessary mean that it is profit-making.
For example, Scotts Square (in Orchard) was launched at an average of $3900 PSF in 2007. Today, it is selling at an average of $3062 PSF! Many owners have lost a hefty sum of money (see attached)!
Without proper knowledge and understanding, you will be working hard to pay for your house instead of letting your house work hard to pay you. The latter is the reason why I have been sharing on property tips.
Here is another property tip as promised over the CNY festive period. I hope the past few tips have been helpful.
Number 6: The Power of Under Supply
Note: You may wonder why it is Number 6 when the title is CNY Property Tip #5. The reason is that in my first post, I have already included Number 1.
You may think that this is a no brainer, but apparently, many people including property agents overlook this good, old principle ----- Demand VS Supply. In my CNY Property Tip #1, I shared that a development having high demand does not always mean that it will make profit. Just because alot of people are buying does not mean it's good. I added that a development with an overflowing supply may in fact, yield a better capital growth.
However, this new tip is NOT focusing on a project development itself. It is pointed at the total supply of residential properties in a particular location. The lower the supply, the better you stand a chance to make a sizeable profit.
This means that buying a new launch condo may NOT always be the best choice.
This means that buying a HOT location may NOT always be the best choice.
The whole world (at least many new and young families) is now trying to move to Punggol... Take a look at the median HDB BTO prices VS resale prices for Punggol (see attached). In the past, Punggol HDB owners made a good sum of profit. But it is no longer the case nowadays. WHY? Oversupply of residential units in Punggol.
Compare it with Bishan (undersupply of residential units) and you will see a whole world of difference. If you do not know, there is still high cash over valuation in Bishan resale HDB units. WHY? Undersupply!
Apply this principle to private residential properties and you will get the SAME result ----- the Power of Undersupply = Good Resale Value!
Bonus Tip: If the size of a new launch condo is small and there are many developments of similar size around the location at similar prices, think twice and research more before you buy! Find an undervalued property that is larger and unique (coupled with other important factors) and you stand a better chance in terms of the resale value.
REMEMBER: Let your house work to pay you instead of you paying your house.
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