Finding undervalued properties for sale in Singapore requires you to look in directions where most folks are not. In my previous post on finding undervalued properties, I mention MRT construction locations as places where most folks will avoid due to the inconvenience. However, that also means a lot of investors will missed out on what can be a potentially good buy when the construction is completed.
In this second article of the series, I am looking at landed properties where their outlook is not pleasant. Specifically, this is what I look for:
- Neglected house in very good neighborhood: What I am looking for here is poorly maintained houses in good locations. We all know that the location is one of the strongest factor in determining the prices of houses. If a house in a good location is neglected, it is highly that the owner might be willing to sell for a lower price. To execute this strategy, you will need to visit these locations often and try to spot houses that have badly maintained exteriors.
- Landed properties with redevelopment opportunities: Some landed properties have the chance to be resold at much higher prices if they are redeveloped. To spot these undervalued properties, you need to look out for 1 storey landed property in places where many of the properties are 2-3 stories high. Check the prices of what these 2-3 stories houses are selling and make a offer that is lower than the price + redevelopment cost.
These 2 tactics go back to my view that it is essential to have ‘pain before the gain’. Most buyers will not want to invest in poorly maintained houses that needs redevelopment. They want to avoid the inconvenience and the hassle of doing the work that can potentially generate higher returns. This leaves opportunities open for folks like us that are willing to do a bit more and get a much higher return.