Property versus Investment

[koxinga]

Between property and investment, what should be a good balance? I am looking to retire around 55 with around 50k+ PA passive income from investments (for me and wife, no kids). I should be able to reach this target at my current rate of investment / income . Currently staying in a HDB but am considering a property (1.2 mil). Wanted a change in environment.

I did some back of the envelope calculation and retirement at 55 does not seem to be attainable if I finance this property since I would have liquidated a part of my portfolio just to pay for this property. Furthermore, if I retire at 55, i would not have enough to pay off the loan if I stop working. Would that just about right?

 

[hwmook]

Since you already know the answers to your question then why do you still ask?

Property is for staying, its an expense. If you can afford then go ahead. If you can't afford it then don't do it.

 

[wutawa]

Buying an sg property (be it private or public) now is extremely expensive. Unless u strike toto or big sweep, it is impossible to have a decent place and retire early.

 

[koxinga]

Since you already know the answers to your question then why do you still ask?

Property is for staying, its an expense. If you can afford then go ahead. If you can't afford it then don't do it.

Wanted to be sure and double check/sound board it. Still interested to move but there isn't much reasonable choices. The thing is prices isn't likely to get cheaper in the future and with older age, the loan period will be reduced. So my options narrows as I grow older.

 

[celtosaxon]

Between property and investment, what should be a good balance? I am looking to retire around 55 with around 50k+ PA passive income from investments (for me and wife, no kids). I should be able to reach this target at my current rate of investment / income . Currently staying in a HDB but am considering a property (1.2 mil). Wanted a change in environment.

I did some back of the envelope calculation and retirement at 55 does not seem to be attainable if I finance this property since I would have liquidated a part of my portfolio just to pay for this property. Furthermore, if I retire at 55, i would not have enough to pay off the loan if I stop working. Would that just about right?

Just do a quick comparison between historical changes in the equity index versus the property index… you will quickly realize, the juice is not worth the squeeze.

 

[ftpofmpo]

Just do a quick comparison between historical changes in the equity index versus the property index… you will quickly realize, the juice is not worth the squeeze.

can explain more?

sti like stagnant leh;

if leverage and buy ppty last time, like can earn more than invest in sti leh

 

[chrisloh65]

can explain more?

sti like stagnant leh;

if leverage and buy ppty last time, like can earn more than invest in sti leh

You are right indeed, because I made more money from investing in properties (using less capital) than from investing in stocks, because investing in properties is always about leverage, and this leverage comes with much lower interest rate and much lower risk then leverage using stocks (which those people claim they can do but can never execute it because they will get margin call very quickly and very soon if they leverage using their stocks as collateral!), LOL! They always claim that you must compare "apple to apple" but yet they like to compare apple to orange,

 

[hwmook]

You are right indeed, because I made more money from investing in properties (using less capital) than from investing in stocks, because investing in properties is always about leverage, and this leverage comes with much lower interest rate and much lower risk then leverage using stocks (which those people claim they can do but can never execute it because they will get margin call very quickly and very soon if they leverage using their stocks as collateral!), LOL! They always claim that you must compare "apple to apple" but yet they like to compare apple to orange,

You can say whatever you want but you can't prove it anyway, just talk and make yourself feel song lor.

 

[chrisloh65]

You can say whatever you want but you can't prove it anyway, just talk and make yourself feel song lor.

I am just stating facts and my experience, and I know very well that is why I feel song. People who have not made so much money from properties will never understand our feelings, and if people want to be sour grapes why should I be bothered? There is no need for me to prove anything here since you also don't know me even if I prove it, so I don't see any point in doing that. If people feels better by being a sour grapes, he/she is always entitled to stick their head into the sand and be like ostriches, or whatever they want/like, who cares about them, LOL!

 

[ftpofmpo]

I am just stating facts and my experience, and I know very well that is why I feel song. People who have not made so much money from properties will never understand our feelings, and if people want to be sour grapes why should I be bothered? There is no need for me to prove anything here since you also don't know me even if I prove it, so I don't see any point in doing that. If people feels better by being a sour grapes, he/she is always entitled to stick their head into the sand and be like ostriches, or whatever they want/like, who cares about them, LOL!

i thot u say u made money from stocks instead? china stocks in particular

 

[chrisloh65]

i thot u say u made money from stocks instead? china stocks in particular

I have always been talking about properties and stocks because I invest in anything that can make money, so why restrict yourself to any single thing? In fact, I made a bundle from US stocks previously, but I sold all in late 2019, then shifted to European stocks and also China stocks, and also into oil stocks in mid 2020.

 

[skpuppy]

I have always been talking about properties and stocks because I invest in anything that can make money, so why restrict yourself to any single thing? In fact, I made a bundle from US stocks previously, but I sold all in late 2019, then shifted to European stocks and also China stocks, and also into oil stocks in mid 2020.

Someone posted this in another thread. I think property will lose to stocks despite the leverage. Unless you find a super attractive priced property

 

[chrisloh65]

Someone posted this in another thread. I think property will lose to stocks despite the leverage. Unless you find a super attractive priced property

Obviously when it comes to properties, it is always about market timing, but then it is also about market timing for stocks isn't it? Unless you are talking about DCA blindly which will give mediocre returns compared to those who know how to market time. But it is also not wrong to say that DCA blindly will give better returns vs those stupid/lazy investors who refused to learn how to invest to achieve higher returns, so to each his/her own, LOL!

 

[proton_cannon]

with ever lower-interest rates and stable environment over the decades, property have made a lot of people rich indeed - just look at the number of tycoons that made it from it.

However property as a pure investment still have risk - the investor is committing a lot toward this 1 single investment that may be difficult to offload when a crisis happens.

With stock market, one can start smaller and diversify across the world easily.

 

[qhong61]

Between property and investment, what should be a good balance? I am looking to retire around 55 with around 50k+ PA passive income from investments (for me and wife, no kids). I should be able to reach this target at my current rate of investment / income . Currently staying in a HDB but am considering a property (1.2 mil). Wanted a change in environment.

I did some back of the envelope calculation and retirement at 55 does not seem to be attainable if I finance this property since I would have liquidated a part of my portfolio just to pay for this property. Furthermore, if I retire at 55, i would not have enough to pay off the loan if I stop working. Would that just about right?

$50k per mth? That's a lot. How to u manage to?

 

[0218crawford]

actually property also investment, so title a bit wrong.
props and stocks and bonds etc all can make money. again question is "Do you know how?"
in fact the underlying financial calculation all same same.
in absolute terms, prop cap gains higher due to large sum invested.
for stocks, to invest as much as prop quantum, example 1million with leverage, one need to have steel balls. not many people have that.
for prop as it is a physical asset that will not 'disappear' overnight, most people will not lose sleep leveraging max to invest.
last time easier to make money from prop. personal experience is IRR 32% p.a. over 4 years. yep. no typo
nowadays harder but not impossible. luck plays a part too.
stocks rules have not changed much over the years. techniques for picking and risk managing established.
if you can make money in the stock market 20 years ago, chances are the same techniques and tools will help you make money today.
remember a sunset industry today was also once a 'growth' stock many years ago.

 

[Meemoosaa]

Someone here once shared this video on the difference between property vs stock/bond/index investment.

Hope it helps.

TLDR - there is nothing wrong with buying a property but it's basically a "lifestyle" decision rather than a path to financial independence. If living in a condo is important for you and you can afford it, there isn't really a hard right or wrong answer to this. It depends on the objective of your life.

From 13:30 onwards.

 

[koxinga]

$50k per mth? That's a lot. How to u manage to?

Read carefully. I said +50K PA (per annum)

actually property also investment, so title a bit wrong.
props and stocks and bonds etc all can make money. again question is "Do you know how?"
in fact the underlying financial calculation all same same.
in absolute terms, prop cap gains higher due to large sum invested.
for stocks, to invest as much as prop quantum, example 1million with leverage, one need to have steel balls. not many people have that.
for prop as it is a physical asset that will not 'disappear' overnight, most people will not lose sleep leveraging max to invest.
last time easier to make money from prop. personal experience is IRR 32% p.a. over 4 years. yep. no typo
nowadays harder but not impossible. luck plays a part too.
stocks rules have not changed much over the years. techniques for picking and risk managing established.
if you can make money in the stock market 20 years ago, chances are the same techniques and tools will help you make money today.
remember a sunset industry today was also once a 'growth' stock many years ago.

Like equities, need to be forward looking and ask whether future growth will be as stellar as it was for the past 30/40 years, even if I am not using the asset as a form of investment simply because it is a large, long term financial commitment.

At age 55, I will be around halfway into the mortgage. Can I safely downgrade without being hit by losses? What are my options then even if I sell off? By then, I won't really care HDB or private as long as it is near a MRT station as well as public conveniences. It is also likely I won't be staying full time in Singapore.

 

[skpuppy]

Read carefully. I said +50K PA (per annum)

Like equities, need to be forward looking and ask whether future growth will be as stellar as it was for the past 30/40 years, even if I am not using the asset as a form of investment simply because it is a large, long term financial commitment.

At age 55, I will be around halfway into the mortgage. Can I safely downgrade without being hit by losses? What are my options then even if I sell off? By then, I won't really care HDB or private as long as it is near a MRT station as well as public conveniences. It is also likely I won't be staying full time in Singapore.

Bro, u r like god mode. Buy low, sell high even Warren Buffett and Cathie Wood cannot. Yes, I think the private property move is ok. Let’s say u r 40 years old. You can commit to a loan of 25 years. After which, u can downgrade if you reach 55. By then if u buy those older HDB flats, u can also bargain with the owners. HDB price depreciates as it hits 30 years. Near mrt is important or not? Yes it is but if u have spare cash, can buy old car also.
My plan is to downgrade then maybe stay few months in Malaysia, Thailand, Europe then rotate back to SG again. By then 2 elderly no need super big la. 90sqm HDB can already.
So sell private then buy old 4 room HDB. Got surplus of $1+ mil exceeding investments, SRS and EHS for cpf. Perfect la. 1 month go around $5k per pax. Not bad liao

 

[wira]

lol you already know the answer that upgrading your house now will certainly derail your early retirement plans.

so its up to you to make the decision if the lifestyle upgrade is worth delaying your retirement by a good 10 years ? cannot assume that property is always on the uptrend and you can still cash out and 'downgrade' at age 55.