5 things to look out for in an investment property

By Aaron De Silva / The Edge Property | June 9, 2017 1:00 PM SGT
So you’re on the market for an investment property. Like any investment, it pays to do your homework before plunging headlong into its depths. But unlike stocks and shares, property purchases run into the hundreds of thousands – if not millions – rather than ones, tens or hundreds of dollars. So before you embark on your journey towards becoming a real estate mogul, here are five things to consider if you want a property that will provide a steady stream of rental income, and, in the future, significant capital gains.
1. Hello, Neighbour
Real estate is all about location, location, location. A property’s immediate surroundings have a direct impact on rental value. It goes without saying that developments with convenient access to public transport and amenities such as schools, healthcare facilities, and supermarkets will be in greater demand than those without. But also take notice of whether there are institutions like universities or hospitals in the vicinity. These would guarantee a steady pool of potential tenants – students, academic staff, and healthcare professionals.
2. Crystal Ball Gazing
Source: URA
Once you’ve narrowed down a few choice locations, find out what’s being planned for the area(s). Get an overview of future development by surveying the URA’s Master Plan. If the area has many new malls, business parks, and condos coming up, there’s probably good growth opportunities. The malls and offices need to be staffed, which means a potentially bigger pool of tenants. Take note, however, that if many new condos are being built, that means competition. Your tenants would be spoilt for choice. It might be a good idea to walk around the neighbourhood and chat with locals – residents, shopkeepers – to find out more about the area’s upcoming developments.
3. Condition Report