Landed vs. High-Rise
If you’re weighing between landed and high-rise properties, consider the following:
1. Rental Income
Generally, condominiums tend to provide a higher return on investment (ROI) compared to landed properties. Despite the potentially higher cost of landed properties, they don’t always guarantee better rental revenue.
2. Property Appreciation
When it comes to selling your property for a profit, ensuring its value appreciates is essential. Freehold landed properties usually have more stable values because they include land, making them more resilient to depreciation.
Leasehold properties, however, may experience value stagnation or depreciation as the lease term nears its end. If you're eyeing short-term gains, holding onto a property for about five years is advisable. For long-term investments, avoid holding onto leasehold properties for more than 10 years if the lease is under 70 years.
3. Maintenance Considerations
Maintenance responsibilities differ between property types. For landed properties, the investor is responsible for upkeep. In contrast, condominium maintenance falls under the management's purview. Poor management can lead to rapid depreciation, so if you notice declining conditions, it might be wise to sell sooner rather than later.
4. Studio Apartments Above Shops
The value of studio apartments above shops can vary widely. A well-maintained and quiet retail shop below can enhance the apartment’s value. However, if the shop is poorly managed or causes security concerns, it can quickly decrease in value.
5. Developer Phases
When purchasing a property from a developer, buying in an earlier phase can be more cost-effective. Later phases are often priced higher, reflecting the developer’s anticipated value rather than the current market value. Consider purchasing from early owners to avoid paying a premium.
Choose the one for you
In summary, always align your investment choice with your goals—whether short-term or long-term. Invest wisely in real estate that fits your strategy and meets the criteria that will make it a valuable asset.
Before finalizing your investment, use a Home Loan Calculator to ensure you’re getting the best deal for your financing needs.
*The above article is intended for informational purposes only. Loanstreet accepts no responsibility for loss that may arise from reliance on information contained in the articles.
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