All Topics / Overseas Deals / Singapore – (A Very) Brief Overview

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  • Profile photo of Ziv Nakajima-MagenZiv Nakajima-Magen
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    Part 1 (of 2 or 3, not sure yet)
     
    http://www.biggerpockets.com/renewsblog/2012/05/18/real-estate-in-singapore-explorations-of-asia-for-property-investors/

    (@Moderator – please note, this is general information for investors, NOT advertising of any sort)

    Ziv Nakajima-Magen | Nippon Tradings International (NTI)
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    Ziv Nakajima-Magen - Partner & Executive Manager, Asia-Pacific @ NTI - Japan Real-Estate Investment Property

    Profile photo of Richard DaviesRichard Davies
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    It’s a really interest article Ziv, my in-laws come from Brunei so I will pass it onto them. It makes sense that Singapore would be a good place to invest as it is well off and has a high density of people.

    Profile photo of Ziv Nakajima-MagenZiv Nakajima-Magen
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    It's certainly good as in relatively safe and stable. As for profitable – depends what you're comparing it with, I suppose. Not my personal cup o'tea, but certainly not a bad Asian port to be parked in, at least in part, in my opinion (come on, Freckle, bring it on lol)

    Ziv Nakajima-Magen | Nippon Tradings International (NTI)
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    Ziv Nakajima-Magen - Partner & Executive Manager, Asia-Pacific @ NTI - Japan Real-Estate Investment Property

    Profile photo of Richard DaviesRichard Davies
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    I will be moving to South East Asia soon Ziv, what are some other spots worth investing in?

    Profile photo of Ziv Nakajima-MagenZiv Nakajima-Magen
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    It all depends on what your goals are. What are you hoping to achieve?

    Ziv Nakajima-Magen | Nippon Tradings International (NTI)
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    Ziv Nakajima-Magen - Partner & Executive Manager, Asia-Pacific @ NTI - Japan Real-Estate Investment Property

    Profile photo of Richard DaviesRichard Davies
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    Well I will be starting a family with my wife in Brunei, which is a goal of sorts. But I guess with investment goals I will have to get back to you on that. Things will become clearer once I start getting some sort of cash flow for the US properties.

    Profile photo of Ziv Nakajima-MagenZiv Nakajima-Magen
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    Richard Davies wrote:
    Well I will be starting a family with my wife in Brunei, which is a goal of sorts. But I guess with investment goals I will have to get back to you on that. Things will become clearer once I start getting some sort of cash flow for the US properties.

    Mate, forget property, best of luck and congrats! :)) what’s Brunei like? (I know, moderator, it’s off topic, have a heart ;))

    Ziv Nakajima-Magen | Nippon Tradings International (NTI)
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    Ziv Nakajima-Magen - Partner & Executive Manager, Asia-Pacific @ NTI - Japan Real-Estate Investment Property

    Profile photo of Richard DaviesRichard Davies
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    Just saw this post Ziv. Many Thanks!

    Well Brunei’s hot like Singapore and sticking with the topic of property, the government has a tendency to give houses to their citizens. Yes it’s true. The country has the 3rd largest supply of oil in Asia, one of the largest supplies of Natural Gas in the World and their ruler; the Sultan is about the 20th richest man on earth, he used to be the 4th a few years back. The best thing is that this guy is not corrupt and quite willingly gives generously to the community.

    This might put things into perspective a bit, the country’s population is around 400,000 people, yet they have a national airline; Royal Brunei Airways which flies out of Melbourne every day. Amazing. Yes they are the fattest country in Asia per capita, but I am a bit of a health nut so there is always potential to get some kind of business going on that front.

    Back to the property stuff though, once I find out more about the property market there, I will start posting some stuff on this site. I will be living there by the end of the year at the latest, and won’t be coming back to Melbourne until the kids are ready for high school, which will be at least a decade.

    Hence my interest in the Asian property market.

    Profile photo of Ziv Nakajima-MagenZiv Nakajima-Magen
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    Been reading about Brunei a bit since you posted – sounds like they're fat in more ways than one – one of Asia's richest per head, as it turns out :) – you could have struck a goldmine there :))

    Regardless of property, once you're settled in, and if you need some health products contacts, let me know – we represent/ed a date-pits health drink manufacturer from Aus/Israel, hand-cold-pressed coconut oil manufacturer from Fiji, both of whom sell internationally – as well as some super-food-Japanese-mushroom growers from both Aus and Jpn – would be more than happy to put you in touch with any of the above so you can cook something up together if you find any local interest (@moderator, not advertising anything, third party referrals).

    Yes, please do post about local property market as you find out – would be very interested to learn more.

    Ziv Nakajima-Magen | Nippon Tradings International (NTI)
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    Ziv Nakajima-Magen - Partner & Executive Manager, Asia-Pacific @ NTI - Japan Real-Estate Investment Property

    Profile photo of Richard DaviesRichard Davies
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    Yeah will do Ziv, the health products also sound great.

    Regarding housing what I do know about Brunei's is that people there have a tendency to renovate them and it is getting tougher regardinig getting premits to do that. 

    What's unique about the housing there is that a lot of the older homes are built on stilts in the water.  They look quite shabby from the front, until you see a satelite dish coming out of them so they can't be too bad.

    Despite the really hot conditions, it rains a lot so water shortage is never an issue either. 

    Most health services are virtually free; my wife who comes a Brunei, pays a dollar to go to the dentist.  Hence yes, the living conditions are very good. That said, the quality of health services in Brunei don't have the best reputation, and citizens who need really serious stuff done (and have the money to spend) will often go to Singapore. 

    I had an aunt who busted a collarbone and flew to Singapore to get a plate put in it recently! Lol
     

    Profile photo of Ziv Nakajima-MagenZiv Nakajima-Magen
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    Self-renovation syndrome (SRS?) – lol I'm originally middle-eastern, so know these well. In Israel you have entire neighbourhoods, particularly some of the arab villages, where there are far less judicial enforcement, that have eternal planks and scaffolding, iron bars sticking out of bare concrete walls, unplastered etc – a street full of those, stacked side by side, is one of the ugliest things imaginable in my opinion, particularly from a property professional point of view. It darn right hurts the eye. :)))

    Seen the stilts in Thailand too and actually been to a few, these guys are master builders, particularly considering the materials they work with – unfortunately, the increase in seismic activity around these parts in recent years spells disaster for these type of settlements :(

    Yup, Singapore is definitely the place to go for healthcare (and shopping!) in Asia. Japanese dental care, which for some reason is attrocious compared to the state of modern medicine there, also sees flocks of Japs getting their teeth done in Singapore. Remarkable, how they've positioned themselves as such in such a relatively short time, isn't it?

    Ziv Nakajima-Magen | Nippon Tradings International (NTI)
    http://www.nippontradings.com
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    Ziv Nakajima-Magen - Partner & Executive Manager, Asia-Pacific @ NTI - Japan Real-Estate Investment Property

    Profile photo of Richard DaviesRichard Davies
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    That’s one thing I found remarkable about the Japanese when I lived over there 10 years ago.. how bad their teeth were! Lol.

    It is interesting to note Ziv, that despite promises from the previous Labour government here in Melbourne, Victoria, that the city would be expanding upwards rather than outwards, the NEW Liberal government this week announced that another six suburbs would be added to the outer areas of Melbourne with the possibility of them housing over 100,000 people!

    This leads me to the question regarding Singapore; are there areas there which the government are looking to expanding, or are they simply looking to add more high rises to provide shelter for their folk and the many internationals?

    Profile photo of javidanjavidan
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    Richard Davies wrote:
    This leads me to the question regarding Singapore; are there areas there which the government are looking to expanding, or are they simply looking to add more high rises to provide shelter for their folk and the many internationals?

    Hi Richard,

    To give yourself a better idea. Singapore is an EXTREMELY tiny island only over 40 km east west and 36 km north to south.

    If you took up the entire island and threw it into Victoria, you would lose it.

    And this tiny island is already currently housing over 5.5 million people.
    In other words, Singapore actually does not physically have land to expand. A lot of the developments are older buildings which are less than 40 years old which have been torn down to pave way for newer and higher buildings.
    There is only some land left in the country but the government hasn’t revealed what they intend to do with it yet.

    They do release new land parcels but this is in the domain of big time developers who have a cozy relationship with the ruling party. And the money we are talking about is in hundreds of millions.

    As a foreigner, you would not be able to own any land there anyway so you are probably looking at private apartments littered around the country.

    Profile photo of Richard DaviesRichard Davies
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    Thanks for the update Ziv, that’s interesting to read.

    The Brunei government has had a tendency to give out land to their citizens in the past, but that country is much bigger than 40 km’s squared! lol

    Profile photo of Ziv Nakajima-MagenZiv Nakajima-Magen
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    That wasn’t actually me ;)

    Ziv Nakajima-Magen | Nippon Tradings International (NTI)
    http://www.nippontradings.com
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    Ziv Nakajima-Magen - Partner & Executive Manager, Asia-Pacific @ NTI - Japan Real-Estate Investment Property

    Profile photo of mattstamattsta
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    agree that singapore is a very tiny country.

    Since apartments are probably what foreigners like Aussies are going to buy, just wanted to know if Singapore apartments tend to have strata title on them?

    Profile photo of Ziv Nakajima-MagenZiv Nakajima-Magen
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    The short answer is “yes”.

    As to the exact nature of the Singapore strata system and it’s implications, I’d suggest contacting some local professionals, as my knowledge is extremely superficial. I don’t live there and have never bought (nor do I think I will in the foreseeable future)

    Ziv Nakajima-Magen | Nippon Tradings International (NTI)
    http://www.nippontradings.com
    Email Me | Phone Me

    Ziv Nakajima-Magen - Partner & Executive Manager, Asia-Pacific @ NTI - Japan Real-Estate Investment Property

    Profile photo of javidanjavidan
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    mattsta wrote:
    agree that singapore is a very tiny country.

    Since apartments are probably what foreigners like Aussies are going to buy, just wanted to know if Singapore apartments tend to have strata title on them?

    Hi mattsta,

    Could you go into a bit more detail as to what you are trying to find out about strata? Ownership responsibilities or fees or?

    I agree with Ziv, a short answer to your short question would definitely be "Yes"

    Profile photo of Alex SCAlex SC
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    zmagen wrote:
    The short answer is "yes". As to the exact nature of the Singapore strata system and it's implications, I'd suggest contacting some local professionals, as my knowledge is extremely superficial. I don't live there and have never bought (nor do I think I will in the foreseeable future)

    Been away from the forum 12 days over seas in Singapore then Malaysia got home and off to New york. Back in Charlotte now , what I can say about Singapore is the food is incredible . The people I dealt with very nice and look forward to my next trip back their.

    Talk soon

    Alex

    Profile photo of realestateprorealestatepro
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    Singapore is an attractive investment arena for property investors from around the world. At the macro level, it has a stable political environment and a transparent legal system. This allows investors to focus on doing their research to anticipate property cycle phases and identify attractive investment opportunities.

    Property investors seek to make a return via both capital appreciation and rental income. Indicatively, they might target an annual after-tax return of inflation plus one percentage point (say, 4 per cent in total) from capital appreciation and 6 per cent from rental income. On a property costing S$1.0 million, these targets translate to an unrealised capital gain of S$40,000 and a rental cash income of S$60,000. Of course, investment is risky and there is no guarantee that these targets will be achieved. Also, capital appreciation typically remains unrealised for many years until a property is sold.

    Investing in a REIT involves placing your capital, along with other investors, in a fund that invests in a portfolio of properties. Some REITs invest broadly across all segments of the property market while others focus on specific segments such as retail, commercial, hotels, industrial and student accommodation.

    Most REITs are listed on the stock exchange and managed by investment professionals. They provide investors with a return via income distributions and stock price appreciation.

    Experienced investors believe that the secret to good property investment is buying property at a low price – a price below market value. The wisdom of this advice can be demonstrated by a simple example.

    Take a property that has a market value of S$1.0 million and an expected annual after-tax rental yield of 6 per cent with capital appreciation of 4 per cent. Buying that property for S$0.9 million – a modest discount of 10 per cent – provides a saving of S$100,000. To match that benefit, you would need to charge a rental yield at 10 per cent (S$6,000 per year) above market price for more than 20 years for it to be equivalent on a discounted present value basis – a task so unlikely that it can practically be described as impossible.

    Buying at a good entry price at good location is key. Liv mb will launch in Q2 2022 at the prime district of Mountbatten, Singapore is one condominium that is worth considering.

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