5 Most Common Questions I Get Asked as a Realtor
In my time as a realtor, I have had my fair share of clients coming to me with dozens of questions regarding property. More often than not, questions are similar among most of my clients. In a way, these questions can form a Frequently Asked Questions section in my mind!
Today, I have decided to write about the 5 most common questions that I get asked as a real estate agent. Think of this as an FAQ section that will come in handy on your property journey and you might one day want to be me yourself! Let’s go.
Question 1: “How is the market, James?”
Let me walk you through my thought processes when someone asks me this question. Firstly, I will begin to break the market down into different sub-segments: premium/high-end, middle end, and mass market.
All of these will behave in a completely distinct way because the market will never be up or down all at the same time! For example, the middle rung of the market can remain quiet while the mass market segment might underperform or overperform.
In the same way, a particular segment will perform differently at different points of the year. For example, the mass market segment can be relatively quiet in a whole year and suddenly pick up in Q1 and Q2 of the next year!
This information can easily be found on my website! Just head over to Singapore Property Price Index (PPI) and all information is available to you! Besides the PPI, you can also find the price trend of different region of Singapore, HDB vs Resale, landed property price trend and even Commercial and Industrial trends.
Question 2: “Do you think now is a good time to buy?”
If you look at the real estate market and its many sub-segments objectively, you’ll see that not all of them are down (or up) at the same moment. For example, many great properties have changed hands in the luxury end of the market during the last three quarters, and while prices in the middle-upper tiers have fallen slightly in recent quarters, the equivalent volume of sales has grown proportionally more. These are among numerous signs that, in my opinion, point to a market sense of price rationalization and sensitivity.
purelyThe truth is, it is extremely difficult to plan the perfect time to buy a property. There will be new factors and challenges to contend with at different points in time. If purchasers wait for prices to drop or for the market to adjust, they may face higher borrowing rates. So, if you need housing or want to invest in one, don’t get stuck in Analysis Paralysis—consult a real estate agent, do your due diligence, and go ahead with your decision!
Of coz what I can provide is a slightly more in-depth research. Few years back, I developed a Property P.L.U.S. System which is not only data-driven. Lot’s of my client’s have great success using my system! (Check out my track record here!) My Property P.L.U.S. System which I developed is a systematic and algorithmic way is analysing the property market after looking through hundreds of local properties.
Question 3: “When will ABSD and TDSR be done away with?”
For the uninitiated, ABSD, or Additional Buyers Stamp Duty, was introduced to make sure that people who were buying property truly saw value in the investment. On the other hand, TDSR, or Total Debt Servicing Ratio was put in place to make sure that people are buying within their limits and capabilities without having to fall into debt.
Here in Singapore, most policies are put in place for a good rhyme and reason. For that reason, even if authorities were to ease property cooling measures like ABSD and TDSR, it is most likely wishful thinking to hope that they will be totally lifted and done away with.
In fact, there has already been some easing—certain TDSR requirements were eased to allow the property to be used as equity. In other words, banks will lend you money if the property is considered equity. This made it simpler for Singaporeans to finance their homes, but it didn’t make it any easier for them to purchase three or four more properties.
In short, as a Singaporean, I truly believe that the ABSD is here to stay and it’s very good for the country. It provides a cushion if ever we do meet with the next economic crisis. Just by removing the ABSD, the government can attract more foreign monies into the local economy, thus boosting out economy. Moreover, the ABSD also helps property pricing from collapsing which we have not seen it since the introduction fo ABSD.
However, if you want to minimise the ABSD, head over to our article on “How to Legally avoid ABSD for Properties in Singapore.”
Question 4: “Should I diversify my portfolio to look at commercial and/or foreign properties?”
Before you ask any property agent this question, you should ask yourself “What is the motivation behind my property purchase?” On top of asking my clients this question, I will definitely take a comprehensive look at the client’s portfolio.
When the acquisition is part of estate planning (for their children) or a planned investment with a very defined exit horizon, motive is clear. But sometimes, a client’s motive isn’t always evident.
After laying all of this groundwork and making sure that all of these issues are taken into account as a whole, I will be better able to provide advice based on what I believe is best.
When deemed fit, I occasionally refer them to other types of real estate, such as commercial, industrial, or international properties. At other situations, when the client’s portfolio isn’t suitable to do so, I will tell them not to buy the property at all. Honesty is the best policy, right? And I take that really seriously! That’s how I have many client-turned friends who can vouch for me on that!
In addition, know the data and taxation for commercial or foreign properties. Know the risk and especially the saleability and the pros and cons.
Question 5: “I am a foreigner/PR, how can I avoid paying so much taxes?!”
Here’s the short answer 99% of the time: You can’t! But before I even go into that, I will usually examine the client’s portfolio. If his or her ONLY goal is to reduce risk by transferring money out of their home country, perhaps banking on property investment and avoiding taxes isn’t the way to go. However, there are certain complex strategies you can employ in the right situation. One example is you are holding on to certain passports like the US or Switzerland with free trade agreement with Singapore, you will not have to pay any ABSD at all!
He or she may even choose to invest their money in a REIT – an indirect real estate investment that does not need the ownership of a physical asset – on the Singapore Stock Exchange. Of course, the benefits that you will get from REIT will be different from property investment! Sometimes, paying taxes is a small sacrifice for larger returns!