June 4, 2012
Since my post touching on freehold versus leasehold, I’ve had a couple of enquiries on investing in certain leasehold developments with what I’d term “enbloc aspirations”. I’m not going to go into a full-blown post on enbloc today, let’s just say that developers’ primary duty is to make profits for their shareholders. They will only pay to enbloc owners a price that makes economic sense to them, so make sure your buy-in price is a good margin below that, else it’s not worth the effort and uncertainty of waiting out for an enbloc.
Moving on, I’d like to do a little post on planning your exit strategy instead. As any seasoned entrepreneur will tell you, you must have an exit strategy if you intend to make any serious money. The other thing to bear in mind? Always, always have a Plan B for when things don’t immediately run in your favour.
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May 30, 2012
I like to emphasize that, much as property analysts and realtors often talk in terms of dollars per square foot, the average home-buyer is less inclined to dwell on these numbers. Affordability to them is more a factor of price quantum rather than the per square foot cost. Do I have enough cash/CPF funds to make the downpayment and can my income support a loan of this quantum? These are the more pertinent questions at the top of a typical buyer’s mind. This is precisely why developers have done such brisk business hawking pseudo-homes the size of broom closets (ie. mickey mouse/shoebox apartments of 300-500 square feet)! Buyers of such units were obviously so taken with the lower price quantum that they failed to notice/ disregarded the exhorbitant premium they were paying in terms of $ psf!
Consider this – a unit of 1055 sft at Alexis sold for $1,327 psf in April this year. Just 3 days prior to this transaction, a 388 sft Mickey Mouse unit there was sold at $1,806 psf, or a whopping 36% premium! Talk about being taken for a ride!
A typical “Mickey Mouse” apartment in Singapore is a whole lot less cheery than this rental villa courtesy of http://www.fla-villa.com.
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