One of the key strategies of my early retirement plan was to invest in a District 9 Singapore property and wait 10 years for it to appreciate from 1.69M to 2.5M. Whether this plan will succeed depend on how well I can read the Singapore property market. Is 2.5M a realistic number?
I am economics trained so I always look at the basic principles of any investment i.e. demand and supply. For property prices, the biggest demand driver is from population growth. As long as the Singapore population keeps on expanding, the demand will push overall prices up. Even if the expanding population might not comprise the rich, there will be spillover effects that will eventually increase the price of my property.
Another factor pushing property prices up is rich individuals from around the region buying Singapore properties as a form of wealth management. If you look around Southeast Asia, there isn’t many countries in this region that offers the kind of safe investment environment that investors prefer. There might be HongKong and Taiwan, but Singapore does offer attractive points for rich investors to come here.
In terms of supply, where are you going to find more land in Singapore? You simply can’t especially in highly desirable areas such as District 9. With increasing demand and a finite land, property prices have no way to go but up.
There might be bumps along the road where economic recession might temporarily depress prices but they always bounce up. If you look at historical trends, prices always come back higher after a recession. Personally, as I lived through 2003 and 2008 recession, I don’t see why this will not continue, especially with a strong government that will do its best to ensure that property prices will not collapse.
Even if property prices do collapse, this is but one of my early retirement strategies. I am confident that as long as I continue to create differents kinds of early retirement plans and execute them, I will succeed eventually. The worse thing is not doing anything and realising it too late.