Are you thinking about buying another property, either for your own stay or for rental income? What are some things you should think about? And what do you need to consider before you sign on the dotted line?
We asked three top agents from OrangeTee & Tie, Raymond Khoo (specialist in HDB resale segment), Brenda Zee (specialist in super luxury segment) and Jeffrey Sim (specialist in GCB and landed segment) about what buyers need to know, depending on what you are looking for. Here’s what we learned.
Buying a new property
If you are looking to purchase a new property, there is a big difference between buying one off plan, compared to buying one that is already built. The former presents a few more challenges, according to the agents.
Raymond explains that it is critical to look at the site and floor plans. This will help buyers to better understand the layout of the house, and visualize the view they will get when they are living in it.
Brenda tells buyers to walk around the actual land site, particularly when the developers’ show galleries are located on another land plot. She also encourages them to check the URA masterplan for any future planned developments on empty land plots nearby, to avoid disappointment over possible blocked views in future.
Buying a resale property
When looking for a resale flat, Raymond advises buyers to observe the condition of the house, which helps them ascertain how much they will need to spend on repairs and renovation after the purchase.
It is also important to know who their immediate neighbours are, to build good relationships and rapport with, and make the overall living experience more pleasant.
Brenda also advises buyers to do their due diligence checks on the owner of the property. If the owners are involved in legal suits or financial debt, these could affect new buyers who take over the property.
In terms of fixtures, she reminds buyers to check for water stains on ceilings, and paying close attention to bathroom ceilings where fresh paintwork might be used to cover leaks.
Buying a property for rental
The requirements for an investment property varies greatly from a property designated for occupation.
Jeffrey and Raymond both agree that an investment property needs to be close to transportation nodes, like a MRT station or public bus stop.
Jeffrey further advises property investors to look out for properties that might be near popular schools and office buildings, which ensures a large tenant pool. Amenities like retail shops and restaurants are also popular among tenants.
According to Brenda, a completed project or a soon to be completed project is more suitable for an investment property, as buyers can expect to earn rental income within a short period of time. Smaller units like studios or 2-bedroom units are also easier to rent.
Brenda also added that some soft features may make a property more attractive to tenants. “Units that are breezy, not noisy and offer privacy are at an advantage to competing units,” she said. “Apart from these, the apartment must be well maintained, clean and tidy, and uncluttered. All bathrooms should also be in good working condition.”
Common mistakes property buyers make
Buyers often miss out on a good property because of a preference for freehold properties over a more convenient location, according to Raymond.
Others, he said, would buy a resale flat with a lower psf pricing and forego a slightly more expensive newly launched property. Sadly, the latter often offers a better capital appreciation potential.
Jeffrey has also seen buyers who made an impulse purchase without doing their own homework, and regretted it later on. Many of them were unduly influenced by family members or friends, or misled by property agents.
Buyers should find a trustworthy and professional property agent who takes time to understand their requirements, and helps them to avoid costly mistakes, he adds.
Brenda advises buyers not to be too focused on flaws in a home that can be easily replaced. “Focus on the buying location,” she said. “Sometimes, buyers forget that they might sell their home further down the road. When that day comes, you will be glad that your home is in a great location.”
She also thinks it is unwise to put up a “low ball” offer if the right property comes along. “Look at the asking price versus the transacted price, if owner has priced it right, a low ball offer will kill the deal.”
Popular elements in Singapore
“In Singapore, I reckon heat is one aspect most will be reluctant to embrace as our local weather is hot and humid,” says Brenda. “Thus, a house that doesn’t face the afternoon sun directly will be preferred.”
She has also noticed a trend of younger people preferring properties closer to the city, to reduce their commuting time. “The younger generation does not want to travel 1.5 hrs from their home to their office and back, simply because the commute does not add a single cent to their bank account, and turns an 8 hour workday into an 11 hour workday.”
For Raymond, he sees buyers preferring smart home features, a close proximity to transportation nodes, and unique facilities for condominiums.
Buyers looking for landed properties and good class bungalows, often prefer larger homes, in a more prestigious location because a home is a status symbol for them, according to Jeffrey.
How to tell if a property purchase is a good deal?
Raymond explains that buyers can tell whether a property is a good deal by looking at the recent transactions and their prices, in relation to the property that they intend to purchase.
They could also take note of any future developments around the property – like a new MRT line or new commercial buildings – which could boost the future value of the property further.
With investment property, a good rental catchment area can be as valuable as a low purchase price, he adds.
On the other hand, Jeffrey and Brenda agree that it can be as simple as whether the buyer is happy with his or her purchase.