Can my D9 property sell for 2.5 million dollars?

Last Updated on

One of my early retirement plan was to invest in a District 9 property that costed 1.7 million dollars and will hopefully appreciate to 2.5 million dollars within the next 10 years. If that happens, I will sell it and retire in Malaysia with more than a million dollar cash + a few hundred thousands in CPF which I can only withdraw when I am over 50 years old.

The 2.5 million is the magic number. My real estate friends warns me that this might not be possible. I knew that it is a not a 100% guarantee but I need to take that risk in order to have at least an additional way to achieve early retirement.  No pain no gain right?

This property has just been TOP so I am starting to see some price movement in the right direction. Below is the most recent transacted prices of my condo. I own the smallest unit of around 1076 sqft. According to the chart, these units are selling between 1.85 million to almost 2 million. So already a paper gain of between 150k to 300k within 9 months. A good sign!

I expect the price to continue its upward movements for the following reasons:

  • Downtown MRT line: Due to the downtown line, there will be a MRT station (Fort Canning Station) within 3 mins walking distance to my condo. When that is completed in 2016, I expect a price increase between 100k to 150k as people value properties that are within walking distance to the MRT.
  • Singapore One Project: There is a group called the Singapore River One (SRO) that wants to promote Singapore River as a must see tourism destination. This group comprise 20 businesses operating along Singapore River so there is a natural incentive for them to do that. In fact, there is already a website and app being available to kickstart the 5 year plan. Since my property is beside the Singapore River, I am sure it will experience price inflation from the increased vibrancy in this area.

  • Population Increase: The biggest driver of property prices is population growth. Since the Prime Minister has already committed to increasing Singapore population from 5 million to 6 million within the next few years, it will sustain the price increase as there will be additional housing demand coming from these new immigrates.
  • FTE agreement: It is expected the Singapore will be signing a new FTE agreement with Europe which allows people working in the Finance sector to purchase homes in Singapore without the tax. I believe this will drive prices up especially housing in prime areas.

Despite the optimism, there are also possibilities of price drops due to the following:

  • Recession: Any sign of recession and there will be possibility of a price drop. However, since I am buying to stay, I am not fearful of such short term price decrease as long as I am confident the longer term direction is up.
  • Price bubble: This is my biggest fear as I am not sure whether the price I paid is reasonable or already carries a price inflation that is not in line with its intrinsic value. If there indeed is a bubble and it bursts, then I can kiss my early retirement goodbye.

Leave a Reply

Your email address will not be published. Required fields are marked *

Releated

Undervalued properties in singapore for sale part 2

Last Updated on August 16, 2013Finding 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 […]